1ac
The United States should legalize nearly all online gambling in the United States
Adv 1
Scenario 1 – Credibility
Continued enforcement of gambling regulations kills the General Agreement on
Trade in Services – that causes trade wars
Codd, 07 – Kathryn B., received her JD from William and Mary in 2008 with the highest
possible honors (“Betting on the Wrong Horse: The Detrimental Effect of Noncompliance in the
Internet Gambling Dispute on the General Agreement on Trade in Services (GATS),” William &
Mary Law Review, vol 49, is 3, Online //Red)
Introduction
Over the past decade, Internet gambling has become a global force. In 2003, the projected industry revenues summed five billion
dollars worldwide.1 With the click of a button, bettors could link up with counterparts in other parts of the globe for a poker
tournament or a game of blackjack. As other countries embraced the operators of this new recreational activity, recognizing it as an
opportunity to spur economic growth and bring in valuable tax revenue, the United States began to crack down on the industry.2
the U.S. federal government and the states started to pass and enforce
regulations prohibiting Internet gambling, resulting in the arrest and conviction of executives of foreign gambling
operations who dared to set foot on U.S. soil.3 This onslaught against the foreign gaming industry did not go
unnoticed, however, and eventually, one small country, Antigua and Barbuda, attempted to fight back against what
it perceived as unfair discrimination against one of its primary sources of income. Antigua brought a complaint against the
United States to the World Trade Organization (WTO), alleging violations of U.S. obligations under the General
Agreement on Trade in Services (GATS).4 The WTO found the United States to be in violation of a specific provision
of GATS and ordered the United States to bring federal law into conformity with its GATS obligations.5 Though
many scholars consider the violation to be minor and the fix relatively uncomplicated,6 thus far the
United States has failed to comply with the WTO’s recommendations.7
As part of this crackdown,
The Dispute Settlement Understanding (DSU) governs disputes, such as this one, that arise under GATS, as well as disputes under
other WTO agreements.8 The DSU vests adjudicatory power in the WTO for all disputes that arise under WTO agreements.9
Although WTO member nations have failed to comply on occasion with WTO decisions involving
violations under other agreements—such as the General Agreement on Trade in Tariffs (GATT) or Trade-Related Aspects
of Intellectual Property Rights (TRIPS)—this lack of compliance has not proved fatal to these agreements .10
GATS, however, is a fairly young multinational trade agreement, and some scholars argue that
GATS has struggled to shape its identity amidst problems with overly flexible
provisions and lack of attention from WTO ministers.11 Although most countries are
likely to acknowledge that the agreement has been a relative success thus far ,12 it has yet to
weather any serious tests to its legitimacy. Because it was instrumental in the formation of GATS,13
other countries will likely look to the United States as an example when deciding
whether to comply with WTO decisions under GATS.
The outcome of the gambling dispute may prove to be a bellwether for the success or failure of the
agreement as a mechanism for regulating trade in services. This Note argues that if the United States fails to
respond appropriately to the recommendations made by the WTO, the legitimacy of GATS as a mechanism for
regulating trade in services disputes will be undermined. Without legitimacy, GATS becomes nothing more than symbolic
lip service to the importance of liberalization in the service trade. Member nations will perceive the agreement as a
weak guarantor of rights and, as a result, will be less likely to resort to the GATS dispute
mechanism should a service trade dispute arise. This in turn may compel WTO members
to take unilateral action to enforce their rights, leading to elevated hostilities and
possible trade wars. To avoid these devastating results and to preserve GATS, the United States should adopt the WTO
recommendations proffered in the gambling dispute.
Part I provides background on the Internet gambling industry, both in Antigua and worldwide. Part II discusses Antigua’s complaint
against the United States and the WTO decision in the gambling dispute and sets forth the basic GATS and DSU provisions governing
such a dispute. Part III considers the benefits of maintaining a strong mechanism for resolving service trade disputes under GATS and
addresses specific compliance issues under the DSU generally. Part IV analyzes previous compliance issues under other WTO
noncompliance in the gambling dispute, in particular, is more likely to
damage the pertinent multilateral trade agreement, GATS. Finally, this Note argues for the United States’s quick
agreements and explains why
adoption of the WTO recommendations in the gambling dispute to preserve the legitimacy of GATS.
** can take out**Continued violation uniquely jacks trade cred
New 14 William New, visiting fellow at the Yale Information Society Project, IP-Watch Director and Editor-in-Chief, and
Catherine Saez, staff writer, Intellectual Property Watch, April 26, 2014, “Antigua Questions Efficacy Of WTO Dispute System Over
IP-Related Case”, http://www.ip-watch.org/2014/04/26/antigua-questions-efficacy-of-wto-dispute-system-over-ip-related-case/
Can the W orld T rade O rganization’s smallest members use the dispute settlement system effectively?
That is a question that seemed to be suggested by the tiny Caribbean nation of Antigua and Barbuda at a WTO Dispute Settlement
Body meeting yesterday, in an intellectual property-related case involving a United States gambling ban. “So just what
does this
dispute resolution process do for a country such as Antigua and Barbuda?” a delegate asked in a prepared
statement for the 25 April DSB meeting. “It seems,” the statement continued, “perhaps the harsh light of this prolonged
action by one of the weakest against the strongest is on the verge of condemning the multilateral
trading system established here some two decades ago as what its critics then feared – a vehicle by
which the strong economies could extract concessions from the weak while at the
same time effectively stone-walling – no, in fairness, denying – the ability of small economies
to obtain any meaningful recourse when wronged by others.” Antigua and Barbuda’s statement,
delivered by Dominica on its behalf, was on its case against the United States involving measures affecting the cross-border supply of
gambling and betting services. The
source of its frustration is what it says is the US failure to comply with the
WTO ruling the Caribbean nation won, and its inability to employ the allowed penalties against
the US out of fear of recrimination. Jamaica made a statement supporting Antigua and Barbuda, noting in particular its
belief that, “For all countries who rely on the rules-based Multilateral Trading System – Small Vulnerable
Economies in particular – it is extremely important that the credibility of the Dispute
Settlement Mechanism be preserved and strengthened through faithful
implementation of decisions not undermined through non-compliance.” In exchange for US blocking of Antiguan
gambling services in the US, Antigua has the right to not protect US$21 million worth of US intellectual property rights every year
unless they mutually resolve the issue. The
U nited S tates has done nothing to resolve the issue, has cast Antigua
has set the small
nation up for harsh criticism for trying to use the remedy provided it by the WTO dispute panel,
and Barbuda as an impediment in US efforts to alter commitments under the WTO services agreement, and
Antigua said. “Over 10 years of following the rules and prevailing, millions of dollars of cost and expense, hours upon hours of fruitless
and frustrating attempts at negotiation – and what has the tiny, developing economy of Antigua and Barbuda gained from the
process?” it said, noting that it is working on a programme extract the value of its lost business as approved by the DSB. “However,
even recourse to this remedy of last resort has led to public statements and pronouncements, accusations that if the Antiguan
government were to actually impose the suspension of concessions, somehow Antigua and Barbuda would be the outliers here, …
would be moving beyond the pale, while at the same time the United States continues to ignore a decade-old ruling against it by this
body.” “Further,” it said, “there is no doubt that the major economies of the world do not have to face the
same fears and uncertainties when they – as they have indeed done – make their own recourse to such
remedies.” The dispute dates back to 2003 when Antigua and Barbuda requested consultations with the US regarding measures
applied by central, regional and local authorities in the US affecting the cross-border supply of gambling and betting services from
Antigua and Barbuda. The small country considered that the cumulative impact of the US measures was aimed at preventing the
supply of gambling and betting services from another WTO members to the US, according to the WTO. In December 2007, the DSB’s
arbitrator ruled that the annual level of nullification or impairment of benefits accruing to Antigua and Barbuda was US$21 million
and that Antigua could request the authorisation from the DSB to suspend the country’s obligations under the WTO Agreement on
Trade-Related Aspects of Intellectual Property Rights (TRIPS) for the same amount annually. At the DSB session of January 2013,
Antigua and Barbuda requested that the DSB authorise the suspension of
concessions and obligations to the US in respect of IP rights. The DSB agreed to grant such authorisation.
However, the authorisation had not been used so far by Antigua and Barbuda.
according to the WTO,
It’s the key test for credibility of the Dispute Settlement Body
Danish 13 Danish, Fourth Year, B.A. LL.B.(H) National University of Advanced Legal Studies, India, Westminster Law Review,
October 2013, vol. 3, iss. 1, “WTO Dispute Resolution and Cross Retaliation under Trips: Is it Sanctioned Piracy of Intellectual
Property? A Case Study of the US - Gambling (Antigua) Case”, http://www.westminsterlawreview.org/wlr16.php
trade-related aspects of intellectual property rights
the WTO was envisioned as having two major functions: legislative and
judicial. The legislative function refers to the role of the WTO as a common platform for encouraging trade between its members
via legal instruments such as trade agreements, as well as to maintain the body of rules followed by its members. The judicial
function is performed by the dispute settlement system that is governed by the Understanding on Rules and
At the time of its creation,
Procedures Governing the Settlement of Disputes (DSU). According to Keisuke Iida, the areas in which the WTO dispute settlement
system has been the most active can be divided between the following five areas: adjudicatory resolution of disputes, fending off
unilateralism, creation of a level playing field in international commerce, reconciliation of trade and nontrade concerns, and balancing
This judicial function of the WTO is instrumental in resolving
various trade related disputes between its members and its procedural aspects as well
as practical efficacy have been thoroughly analysed. This article examines the actions of Antigua and Barbuda (hereinafter Antigua),
a small island nation in the Caribbean and one of the smallest WTO members; which recently gained international attention
following it being granted approval to suspend obligations under TRIPs to the U nited S tates of
America as a result of a Dispute Settlement Body (DSB) authorization. The case of US – Gambling has
assumed great importance for the allegations of piracy of intellectual property that were levelled against
Antigua when it attempted to follow up on its authorised suspension of obligations under TRIPs .
Equating a WTO approved remedy with the piracy of i ntellectual p roperty by the US cast
its various other functions.7
aspersions of illegality upon the entire proceedings and created a fallacious image
for other nations as to the intellectual property regime in Antigua. It is thought that the
final outcome of this case will set the standard for the efficacy of the WTO DSU and
its usefulness to developing countries. This article also focuses on the non conventional remedy of cross
retaliation under the TRIPs Agreement that can be given against errant states in cases of non compliance with the WTO rulings. This
remedy is usually pursued after conventional methods for ensuring compliance fail due to a multitude of factors. For example, the
complainant would be unable to impose trade sanctions upon the defaulting member, due to a wide disparity in economic strength or
due to the harm it would suffer by imposition of such trade tariffs. In this situation, the complainant may choose to retaliate under
Article 22 of the DSU, which allows retaliation under a different trade agreement. This unique remedy was first requested, and
obtained, by Ecuador in EC – Bananas III (Ecuador)8 (hereinafter EC – Bananas III) and has been similarly requested by Antigua in
US – Gambling and Brazil in US – Upland Cotton9 , with the former being authorised to proceed under it.10 Such an extreme option
may only be requested by a nation approaching the WTO for dispute settlement when the biggest problem faced by it is that of making
an errant state comply with the rulings or take effective measures for retaliation without jeopardizing its own economic interests. This
was summed up concisely by Robert Hudec, when he noted that "enforcement is a more complex process than mere retaliation".11 2.
The WTO DSU is the mechanism
provided in the WTO Agreement for Members to resolve disputes with respect to international
trade. It is invoked when a WTO signatory nation has a complaint against the trade practices of a
fellow WTO member and feels that it is not compliant with the rules set by any regional trade agreements
Brief Exposition of the Stages of Dispute Resolution Mechanism followed by the WTO
or with the WTO guidelines. The system followed for settlement of disputes can be classified into 2 distinct categories: the pre-litigation
and the adjudication phase. In the pre-litigation phase, also known as Consultation12 , the parties are given an opportunity to work
out their differences in a mutually acceptable manner via good offices, conciliation and mediation, which are non-judicial or diplomatic
forms of voluntary alternative dispute settlement as provided under Article 5.13 A large majority of disputes brought to the WTO do
not proceed beyond this stage. This is mostly attributed to the parties reaching a satisfactory settlement, or because the complainant
withdrew the complaint or did not to pursue the matter further.14 Consultations provide the parties an opportunity to resolve any
misunderstandings as to the facts and nature of the issue in contention and thereby lay the foundation for a settlement or for further
proceedings under the DSU.15 In the Uruguay Round Agreement, it was decided that in the absence of a mutually agreed solution, the
first objective of the dispute settlement mechanism is to secure the withdrawal of the measures concerned if these are found to be
inconsistent with the provisions of any of the covered agreements. Secondly, the provision of compensation should be resorted to only
if the immediate withdrawal of the measure is impracticable and as a temporary measure pending the withdrawal of the measure
which is inconsistent with a covered agreement. An option provided by the DSU to its Members invoking the dispute settlement
procedures is the possibility of suspending the application of concessions or other obligations under the covered agreements on a
discriminatory basis vis-à-vis the other Member, subject to authorization by the DSB of such measures.16 Getting approval for use of
such actions is preceded by lengthy legal procedures that the complaining nation may not palatable, given that it entails high costs and
is subject to inevitable delays. While the legal burden is mitigated to some extent by the presence of the ‘Advisory Centre on WTO Law’
which provides legal aid to developing and least developed nations, the economic costs in the form of delays is a major deterrent to
any nation opting to proceed under this mechanism. A WTO Member may request the establishment of a Panel for dispute resolution
under Article 6 of the DSU, the findings of which are compiled into a final report that is issued to the disputing parties and later
circulated to all WTO Members. This report by the Panel must be adopted at a meeting of the DSB within 60 days of the distribution
of the report to WTO members. The scope of appeal against the ruling is limited by Article 17.6 of the DSU to “issues of law covered in
the panel report and legal interpretations developed by the panel.” During appeal, the report is considered by a 7 member ‘Appellate
Body’ of the WTO, which issues its recommendations within 60 days of the notification of appeal by the disputing party, which then
The effectiveness of
any judicial process can only be seen by the results of its implementation. Under Article
21 of the DSU, if the report adopted by the DSB finds the defending Member in violation of an
obligation under a WTO agreement, then that Member has to modify its policies and bring it in
line with the guidelines, as well as inform the DSB of its implementation plans within 30 days of the panel report or any
has to be adopted by the DSB by consensus and unconditionally accepted by the disputing parties.17
Appellate Body report being adopted. While the DSB is tasked with monitoring the implementation of adopted recommendations or
rulings,18 the task of ensuring compliance usually falls upon the member that gained the favourable ruling from the DSB. However,
ensuring compliance from countries in breach of international trade rules can be difficult, especially if the victorious country is a
developing or least developed nation. It has been seen in many instances that such nations are ill equipped to effectively enforce
compliance with the DSB ruling since their own domestic markets do not possess sufficient economic clout for imposing trade
sanctions that might significantly affect the commercial interests of the defaulting nation. In these circumstances, it is unlikely that
any restrictions imposed by such countries will have a substantial impact on the economy of a developed nation. Further, a large
number of nations have resisted from proceeding against defaulting developed nations fearing international political pressure and a
degeneration of diplomatic relations which usually accompanies any attempts at forcing compliance with adverse rulings. Article 22
of the DSU deals with the Compensation and the Suspension of Concessions in case of members in violation of international trade
rules. It states that compensation and suspension of concessions or other obligations are temporary measures available in the event
that the recommendations and rulings are not implemented within a reasonable period of time. It further adds that neither
compensation nor the suspension of concessions or other obligations is preferred to full implementation of a recommendation to bring
a measure into conformity with the covered agreements. This shows that the option of compensation and suspension of concession is
a secondary measure for enforcing compliance instead of standard practice in dispute settlement. Article 22.3 of the DSU lists the
procedures that must be followed before suspension of obligations or concessions by the complaining party. According to it, the general
principle is that the complaining party should first seek to suspend concessions or other obligations with respect to the same sector(s)
as that in which the panel or Appellate Body has found a violation or other nullification or impairment. If the general principle is
impracticable or ineffective, then the complaining party can suspend concessions or other obligations with respect to other sectors
under the same agreement, or if the circumstances are serious enough, it may seek to suspend concessions or other obligations under
another covered agreement.19 The latter remedy provided in the WTO DSU is commonly known as “cross-retaliation”. Abbott defines
it as the suspension of concessions in a sector of trade different than the sector in which the trade injury is suffered, including under
a different WTO covered agreement. He further adds that the rationale behind suspending concessions under GATT, GATS or TRIPs
is that, affected entities in the country against which trade barriers are imposed will exercise their influence on the government to
bring trade measures into conformity in order to avoid bringing harm to themselves.20 3. Cross – Retaliation under TRIPs Agreement
The rise of global trade in recent years has culminated in a greater transfer of goods, services and intellectual property between nations.
While there has been almost equal bilateral trade in goods and services, the transfer of intellectual property has usually been from the
developed nations to the developing and least developed countries. Protection of intellectual property (or the lack thereof) at the
international level has therefore been a source of frustration in inter-country economic relations. Before the TRIPs Agreement came
into effect, there was no effective mechanism for enforcement or provisions for the imposition of sanctions if the obligations were not
met. The then prevailing system of treaties maintained by the World Intellectual Property Organisation (WIPO) which regulated
protection of international intellectual property did not provide, in the view of proponents of TRIPs negotiations, sufficient regulations
or adequate mechanisms to enforce intellectual property rights internationally. At the end of negotiations in the Uruguay Round in
1993, the TRIPs Agreement was included as a basic component of the Agreement that established the WTO, and brought into effect in
1995.21 All TRIPs signatories are required to implement basic standards and minimum enforcement obligations in their respective
intellectual property regimes, which accord sufficient protection to private holders of intellectual property. A particularly important
element of the TRIPs Agreement is the system of dispute settlement established under the WTO Agreement. The TRIPs Agreement
itself invokes the provisions of Article XXII and XXIII of the WTO Agreement as elaborated by the WTO DSU, which applies to
consultations and settlement of disputes under the TRIPs Agreement.22 However, in certain circumstances, the WTO may allow
retaliation under Part V of the TRIPs Agreement itself. This remedy is given to the complaining party when imposition of trade tariffs
or sanctions will have an adverse impact on its own economy. Such an action permits a country to suspend certain intellectual property
rights of the country that has violated the rules related to any Agreement under WTO. Since the retaliation is not under the same
agreement which is the subject matter of the dispute, such an action is known as “Cross Retaliation”.23 The provision for Cross
Retaliation under the WTO DSU was included at the behest of several developed nations that believed that such a mechanism would
be an effective tool to curb violation of the TRIPs agreement by developing countries, since cross retaliation against goods or services
from such nations would be more effective than retaliating against the intellectual property of developing countries.24 Cross
Retaliation under the TRIPs Agreement is a remedy rarely sought and even more rarely authorized. Some of the factors that come into
question are whether the circumstances are sufficiently serious to justify cross-retaliation among covered agreements; According to
Abbott, in the case of US – Gambling, the arbitrators did not have any difficulty accepting Antigua’s position based on factors such as
(i) serious disparity in national economic circumstances; (ii) dependency on services trade leading to vulnerability to external factors;
and (iii) the need for Antigua to diversify its economy.25 The procedure for authorisation to suspend obligations under TRIPs was
clearly laid out by the ruling in EC – Bananas III, and that was the precedent followed by the DSB in US – Gambling as well. In the
former case, the US, as a complaining party, retaliated by raising tariffs on EC goods. However, Ecuador sought to retaliate under the
TRIPs Agreement citing that retaliation against EC exports of goods or services was not “practicable or effective” under Article 22.3.
The argument put forward by Ecuador was that retaliation in the form of trade tariffs would harm its economy and was, in any case
too small to inflict any meaningful pain on the defendant nations.26 Even after being authorized to impose sanctions and suspend
obligations, Ecuador never made use of the opportunity against the European Communities on the basis that the harm to the
Ecuadorian economy would outweigh the possible benefit of persuading the European Communities27 to comply with its
commitments.28 A most interesting aspect about this case, apart from it being the first decision concerning cross retaliation under
the TRIPs Agreement, is the complete lack of allegations of piracy of intellectual property which have been levelled against Antigua,
which have been discussed below. While it is difficult to pinpoint an exact reason for this, possible explanations include the settlement
of the dispute and the omission of any action towards active suspension of intellectual property. One of the major impediments to
practically utilizing cross – retaliation is the problem of equivalence. The quantum of revenue that can be collected by the country by
the suspension of obligations under the TRIPs Agreement is determined by the Panel based on their findings. For example, in the case
of US – Gambling, Antigua claimed that it had suffered losses of approximately $3.4 billion. This was based on an assessment of the
annual trade that it considered it had lost, as a result of the maintenance of the WTO inconsistent measures by the US, beyond the end
of the reasonable period of time for implementation.29 The US challenged this position and claimed that the losses amounted only to
$500,000. The panel disagreed with both parties and found that the losses amounted only to $ 21 million and therefore Antigua could
retaliate only up-to this amount.30 ,31 This difference in valuation of damages also stretches to the valuation of intellectual property
which is sought to be suspended. For example, in US – Gambling, if Antigua does suspend American copyrights or patents, then the
price at which it sells the intellectual property is entirely dependent on what it determines to be the appropriate level. So, instead of
selling it at its marked price, it may choose to sell it just above cost. This would create an immediate incentive for consumers to move
away from American sellers who are forced to sell the same product at the marked price that is inclusive of royalties and taxes. This
creates an imbalance in the trading structure, since one seller can massively undercut every other competitor and still eke out a profit.
So, apart from the “illegal” gains being made by Antigua32 , there are substantial losses being suffered by the American holders of
intellectual property on account of loss of royalties in addition to production costs. This is exacerbated by the fact that there is no
equivalence between the gains made and losses suffered. These losses and the general American view of intellectual property
infringement are the main reasons why allegations of ‘theft’ and ‘piracy’ have come into being in this case. 4. Case Study of US –
The case of US – Gambling has become the acid test for those
member states of the WTO seeking to determine whether the DSU can deliver
practical and timely benefits for small and vulnerable economies. Antigua and Barbuda, a
small, twin-island nation in the Caribbean Sea, is one of the smallest WTO members. The roots of the case can be traced
Gambling (Antigua) DS285
back to the actions of the Antiguan government in the early 1990s, when, in an attempt to diversify the country’s economy, it poured
significant resources to create a closely regulated and supervised cross-border gaming industry. Aided by a number of foreign
investors, the sophisticated gambling infrastructure that was created helped supplement a significant decline in tourist revenues,
which was the largest source of income for the island. In the following decade, online gambling became the second most revenue
generating activity on the island and had become its second largest employer, with close to 5% of the country’s population working in
that sector.33 According to Antigua, the effect of measures imposed by the United States was to prevent the cross-border supply of
gambling and betting services and therefore threatened the livelihood of its thriving online betting services industry.
Antigua
alleged that the policies of the U nited S tates were inconsistent with its obligations under the General
Agreement on Trade in Services (GATS). However, in its defence, the US claimed its right to determine its own domestic policies
and cited the need to protect “public morals and public order,” which is an allowable exception to the WTO rules.34 The WTO found
that the measures imposed by the US regarding horseracing were applied in a discriminatory manner to foreign services suppliers as
compared to domestic ones.35 The effect of this US policy on the Antiguan economy was enunciated by Antigua’s Finance Minister
Harold Lovell, when he said that “[T]he economy of Antigua and Barbuda has been devastated by the United States’ government’s
long campaign to prevent American consumers from gambling on-line with offshore gaming operations…result[ing] in the loss of
thousands of good paying jobs and seizure by the Americans of billions of dollars belonging to gaming operators and their customers
in financial institutions across the world.”36 It was with such sentiments that Antigua approached the WTO DSB. On 21 July 2003,
the WTO DSB established a panel at the request of Antigua to resolve the dispute. Both the panel and the Appellate Body found certain
measures of the United States to be inconsistent with some obligations of the United States under the GATS. On 20 April 2005, the
The resulting DSB
recommendations include, inter alia, that the U nited S tates bring the measures found to be inconsistent
with the GATS into conformity with its obligations under that agreement. In April 2006, the
DSB adopted the report of the panel, as modified by the report of the Appellate Body.
United States informed the DSB that it had implemented the recommendations, while Antigua disputed the claim. After the
consultations between the two nations failed, Antigua took recourse to Article 21.5 of the DSU and requested for the establishment of
a Panel,37 which concluded in its report that the United States had failed to comply with the recommendations and rulings of the DSB.
This report was subsequently adopted by the DSB in May 2007. In June 2007, Antigua requested authorization from the DSB to
suspend the application to the United States of concessions and related obligations of Antigua under the GATS and the TRIPs
Agreement. This was opposed by the US stating that it (i) objected to the level of suspension of concessions and obligations proposed
by Antigua and Barbuda and (ii) claimed that Antigua and Barbuda’s proposal did not follow the principles and procedures set forth
in Article 22.3 of the DSU.38 In December 2007, it was determined that the annual level of nullification or impairments of benefits
accruing to Antigua should be US$ 21 million per annum and that Antigua may request authorization from the DSB to suspend
obligations under the TRIPs Agreement at a level not exceeding US$ 21 million annually.39 The grant of the Award to Antigua was
seen as a great victory for the people of the island nation. This was evident from the statement of Dr. John W. Ashe, Antigua’s
Ambassador to the WTO, when he said that, “This is a smashing success for Antigua in every possible way. The report will sweep away
any lingering doubt that Antigua has obtained a clear and convincing win over the United States in this matter. It is now time for the
United States to meet its international trade obligations to Antigua and work with us in a constructive manner to resolve this
even after the release of the Award, the U nited S tates failed to comply with the
rulings and denied all Antiguan efforts for a fair negotiated settlement. On the basis of conclusions and
dispute.”40 However,
determinations of the Arbitrators in the Award and in accordance with Article 22.7 of the DSU, at the DSB meeting on 28 January
2013, Antigua requested authorization from the DSB to suspend concessions and other obligations to the United States in respect of
intellectual property rights under Sections 1, 2, 4, 5 and 7 of Part II of the TRIPs Agreement.41 The most recent development in the
Antigua, in its communication to the DSB said that it has so far not any seen
substantial progress on compliance by the U nited S tates with the DSB’s decision or in achieving a settlement with
case took place on 25 April 2013, when
Antigua and Barbuda.42 Justifying its complaints, Antigua bemoaned to the DSB that “[T]his matter is now ten years old, and the lack
of progress in the case is a very disappointing reality for Antigua and Barbuda. The long campaign conducted by the United States
authorities to shut down the online gaming industry in Antigua and Barbuda has borne bitter fruit. An industry that was once the
second largest employer in Antigua and Barbuda, employing over 5% of the population, now lies in ruin. Thousands have been made
jobless, and many thriving companies have collapsed, due to actions that this body has ruled to be contrary to world trade rules.” It
further went on to add that “After more than five years of patient negotiation, Antigua and Barbuda has come reluctantly to the view
that only utilization of the authorization for cross-retaliation received from the DSB on 28th January will move this matter forward.
As a party to all the major international conventions that protect the rights of IP stakeholders, Antigua and Barbuda sees this trade
remedy as having far-reaching effects that may not necessarily be able to be contained.” After making such an obvious threat, Antigua
concluded by stating, very allegorically that “In fact, we suspect that once that Rubicon has been crossed, all the King’s horses and all
the King’s men may not be able to put Humpty-Dumpty back together again. So, before we set our foot to that path, we appeal to the
United States to make one last effort at bringing its complex bureaucratic structure to a decision that will avoid unpredictable
consequences.”43 As of June 2013, Antigua had not initiated any proceedings aimed at profiting from suspension of the intellectual
property obligations owed to the US. However, many reports seem to suggest that it
may soon set up a website
for the sale of American i ntellectual p roperty, if the negotiations deadlock is not broken.44
In the decade that has passed since the initiation of this case, there has not been any significant
shift in the American position regarding its obligations under the GATS. Antigua is still engaged in the use
of pressure tactics in the hope of getting the US to comply with the rulings. However, whenever Antigua has shown signs
of putting its ruling into action, the Americans have responded with threats, claiming intellectual property
piracy and violation of international trade laws. The Antiguan action has been authorised by the DSB after all
the procedures laid down in the DSU were followed to the letter without any breach in its legality.
Further, the way in which Antigua has proceeded against the US has conformed to all the standards expected of a country using an
international trade dispute redressal forum. Yet there have been aspersions on Antiguan conduct by American authorities.
Notwithstanding extant jurisprudence, the levelling of such allegations constitutes a
severe breach
of trust in WTO procedures. Irrespective of its non compliance with the WTO rulings and
disregard of the threat of cross retaliation, the despicable way in which the US has
besmirched Antiguan reputation to cast it as a promulgator of i ntellectual p roperty piracy has
also raised questions on the legality of cross retaliation under TRIPs.
Strong WTO leadership is key to prevent hostile protectionist blocs and global
warfare.
Panitchpakdi 2004 (Supachai, Secretary-General Conference on Trade & Development, 2/26/04, Speech Before National
Press Club, “American Leadership and the World Trade Organization: What is the Alternative?”,
http://www.wto.org/english/news_e/spsp_e/spsp22_e.htm)
I can sum up my message today in three sentences: The
United States, more than any single country, created the
world trading system. The US has never had more riding on the strength of that system. And US leadership — especially
in the current Doha trade talks — is indispensable to the system's success. It is true that as the WTO's importance to
the world economy increases, so too does the challenge of making it work: there are more countries, more issues, trade is in the spot
light as never before. But the
fiction that there is an alternative to the WTO — or to US leadership — is both
naïve and dangerous. Naïve because it fails to recognize that multilateralism has become more — not less — important to
advancing US interests. Dangerous because it risks undermining the very objectives the US seeks — freer trade, stronger rules, a
more open and secure world economy. The Doha Round is a crucial test. The core issues — services, agriculture, and industrial
tariffs — are obviously directly relevant to the US. America is highly competitive in services — the fastest growing sector of the world
economy, and where the scope for liberalization is greatest. In agriculture too the US is competitive across many commodities — but
sky-high global barriers and subsidies impede and distort agricultural trade. Industrial tariffs also offer scope for further
liberalization — especially in certain markets and sectors. But what is at stake in these talks is more than the economic benefits that
would flow from a successful deal. The
real issue is the relevance of the multilateral trading system. Its
new WTO — created less than ten years
ago — is pivotal to international economic relations. But this means that the costs of failure are also higher — with
expanded rules, broader membership, and binding dispute mechanism means that the
ramifications that can be felt more widely. Advancing the Doha agenda would confirm the WTO as the focal point for global trade
negotiations, and as the key forum for international economic cooperation. The credibility of the institution would be greatly
enhanced. But if the Doha negotiations stumble, doubts may grow, not just about the WTO's effectiveness, but about the future of
multilateralism in trade. This should be a major concern to the US for two reasons: First, the US
is now integrated with
the world economy as never before. A quarter of US GDP is tied to international trade, up from 10 per cent in 1970 —
the largest such increase of any developed economy over this period. A third of US growth since 1990 has been generated by trade.
And America's trade is increasingly global in scope — 37 per cent with Canada and Mexico, 23 per cent with Europe, 27 per cent with
Asia. Last year alone, exports to China rose by almost 30 per cent. The US has also grown more reliant on the rules of the
multilateral system to keep world markets open. Not only has it initiated more WTO dispute proceedings than any other country —
some 75 since 1995 — according to USTR it has also won or successfully settled most of the cases it has brought. The point is this:
even the US cannot achieve prosperity on its own; it is increasingly dependent on international
trade, and the rules-based economic order that underpins it. As the biggest economy, largest trader and one of
the most open markets in the world, it is axiomatic that the US has the greatest interest in widening and deepening the multilateral
system. Furthermore, expanding international trade through the WTO generates increased global prosperity, in turn creating yet
more opportunities for the US economy. The second point is that strengthening the world trading system is essential to America's
wider global objectives. Fighting
terrorism, reducing poverty, improving health, integrating China and
other countries in the global economy — all of these issues are linked, in one way or another, to world
trade. This is not to say that trade is the answer to all America's economic concerns; only that meaningful solutions are
inconceivable without it. The world trading system is the linchpin of today's global order — underpinning its
security as well as its prosperity. A successful WTO is an example of how multilateralism can work. Conversely, if it weakens or fails,
much else could fail with it. This is something which the US — at the epicentre of a more interdependent world — cannot afford to
ignore. These priorities must continue to guide US policy — as they have done since the Second World War. America has been the
main driving force behind eight rounds of multilateral trade negotiations, including the successful conclusion of the Uruguay Round
and the creation of the WTO. The US — together with the EU — was instrumental in launching the latest Doha Round two years ago.
Likewise, the recent initiative, spearheaded by Ambassador Zoellick, to re-energize the negotiations and move them towards a
successful conclusion is yet another example of how essential the US is to the multilateral process — signalling that the US remains
committed to further liberalization, that the Round is moving, and that other countries have a tangible reason to get on board. The
reality is this: when the US leads the system can move forward; when it withdraws, the system drifts. The fact that US leadership is
essential, does not mean it is easy. As WTO rules have expanded, so too has as the complexity of the issues the WTO deals with —
everything from agriculture and accounting, to tariffs and telecommunication. The WTO is also exerting huge gravitational pull on
countries to join — and participate actively — in the system. The WTO now has 146 Members — up from just 23 in 1947 — and this
could easily rise to 170 or more within a decade. Emerging powers like China, Brazil, and India rightly demand a greater say in an
institution in which they have a growing stake. So too do a rising number of voices outside the system as well. More and more people
recognize that the WTO matters. More non-state actors — businesses, unions, environmentalists, development NGOs — want the
multilateral system to reflect their causes and concerns. A decade ago, few people had even heard of the GATT. Today the WTO is
front page news. A more visible WTO has inevitably become a more politicized WTO. The sound and fury surrounding the WTO's
recent Ministerial Meeting in Cancun — let alone Seattle — underline how challenging managing the WTO can be. But these
challenges can be exaggerated. They exist precisely because so many countries have embraced a common vision. Countries the world
over have turned to open trade — and a rules-based system — as the key to their growth and development. They agreed to the Doha
Round because they believed their interests lay in freer trade, stronger rules, a more effective WTO. Even in Cancun the great debate
was whether the multilateral trading system was moving fast and far enough — not whether it should be rolled back. Indeed, it is
critically important that we draw the right conclusions from Cancun — which are only now becoming clearer. The disappointment
was that ministers were unable to reach agreement. The achievement was that they exposed the risks of failure, highlighted the need
for North-South collaboration, and — after a period of introspection — acknowledged the inescapable logic of negotiation. Cancun
showed that, if the challenges have increased, it is because the stakes are higher. The
bigger challenge to American
leadership comes from inside — not outside — the United States. In America's current debate about trade,
jobs and globalization we have heard a lot about the costs of liberalization. We need to hear more about the
opportunities. We need to be reminded of the advantages of America's openness and its trade with the world — about the economic
growth tied to exports; the inflation-fighting role of imports, the innovative stimulus of global competition. We need to explain that
freer trade works precisely because it involves positive change — better products, better job opportunities,
better ways of doing things, better standards of living. While it is true that change can be threatening for people and societies, it is
equally true that the vulnerable are not helped by resisting change — by putting up barriers and shutting out competition. They are
helped by training, education, new and better opportunities that — with the right support policies — can flow from a globalized
economy. The fact is that for every job in the US threatened by imports there is a growing number of high-paid, high skill jobs
created by exports. Exports supported 7 million workers a decade ago; that number is approaching around 12 million today. And
these new jobs — in aerospace, finance, information technology — pay 10 per cent more than the average American wage. We
especially need to inject some clarity — and facts — into the current debate over the outsourcing of services jobs. Over the next
decade, the US is projected to create an average of more than 2 million new services jobs a year — compared to roughly 200,000
services jobs that will be outsourced. I am well aware that this issue is the source of much anxiety in America today. Many Americans
worry about the potential job losses that might arise from foreign competition in services sectors. But it’s worth remembering that
concerns about the impact of foreign competition are not new. Many of the reservations people are expressing today are echoes of
what we heard in the 1970s and 1980s. But people at that time didn’t fully appreciate the power of American ingenuity. Remarkable
advances in technology and productivity laid the foundation for unprecedented job creation in the 1990s and there is no reason to
doubt that this country, which has shown time and again such remarkable potential for competing in the global economy, will not
soon embark again on such a burst of job-creation. America's openness to service-sector trade — combined with the high skills of its
workforce — will lead to more growth, stronger industries, and a shift towards higher value-added, higher-paying employment.
Conversely, closing the door to service trade is a strategy for killing jobs, not saving them. Americans have never run from a
challenge and have never been defeatist in the face of strong competition. Part of this challenge is to create the conditions for global
growth and job creation here and around the world. I believe Americans realize what is at stake. The process
of opening to
global trade can be disruptive, but they recognize that the US economy cannot grow and prosper
any other way. They recognize the importance of finding global solutions to shared global problems. Besides, what is the
alternative to the WTO? Some argue that the world's only superpower need not be tied down by
the constraints of the multilateral system. They claim that US sovereignty is compromised by international rules, and
that multilateral institutions limit rather than expand US influence. Americans should be deeply sceptical about these claims.
Almost none of the trade issues facing the US today are any easier to solve unilaterally, bilaterally or
regionally. The reality is probably just the opposite. What sense does it make — for example — to negotiate e-commerce rules
bilaterally? Who would be interested in disciplining agricultural subsidies in a regional agreement but not globally? How can
bilateral deals — even dozens of them — come close to matching the economic impact of agreeing to global free trade among 146
countries? Bilateral
and regional deals can sometimes be a complement to the multilateral system, but
never be a substitute. There is a bigger danger. By treating some countries preferentially, bilateral
and regional deals exclude others — fragmenting global trade and distorting the world economy.
Instead of liberalizing trade — and widening
they can
growth — they
carve it up. Worse, they have a domino effect: bilateral deals inevitably beget more bilateral
deals, as countries left outside are forced to seek their own preferential arrangements, or risk further marginalization. This is
precisely what we see happening today. There are already over two hundred bilateral and regional agreements in existence, and each
month we hear of a new or expanded deal. There is a basic contradiction in the assumption that bilateral approaches serve to
strengthen the multilateral, rules-based system. Even when intended to spur free trade, they can ultimately risk undermining it. This
is in no one's interest, least of all the United States. America
led in the creation of the multilateral system after
1945 precisely to avoid a return to hostile blocs — blocs that had done so much to fuel interwar
instability and conflict. America's vision, in the words of Cordell Hull, was that “enduring peace and the welfare of nations
was indissolubly connected with the friendliness, fairness and freedom of world trade”. Trade would bind nations
together, making another war unthinkable. Non-discriminatory rules would prevent a return to
preferential deals and closed alliances. A network of multilateral initiatives and organizations — the Marshal Plan, the
IMF, the World Bank, and the GATT, now the WTO — would provide the institutional bedrock for the international rule of law, not
power. Underpinning all this was the idea that freedom — free trade, free democracies, the free exchange of ideas — was essential to
peace and prosperity, a more just world. It is a vision that has emerged pre-eminent a half century later. Trade has expanded
twenty-fold since 1950. Millions in Asia, Latin America, and Africa are being lifted out of poverty, and millions more have new hope
for the future. All the great powers — the US, Europe, Japan, India, China and soon Russia — are part of a rules-based multilateral
trading system, greatly increasing the chances for world prosperity and peace. There is a growing realization that — in our
interdependent world — sovereignty is constrained, not by multilateral rules, but by the absence of rules. All of these were America’s
objectives. The US needs to be both clearer about the magnitude of what it has achieved, and more realistic about what it is trying to
— and can — accomplish. Multilateralism can be slow, messy, and tortuous. But it is also indispensable to managing an increasingly
integrated global economy. Multilateralism is based on the belief that all countries — even powerful countries like the United States
— are made stronger and more secure through international co-operation and rules, and by working to strengthen one another from
within a system, not outside of it. Multilateralism's greatest ideal is the ideal of negotiation, compromise, consensus, not coercion.
As Churchill said of democracy, it is the worst possible system except for all the others. I do not believe America's long-term
economic interests have changed. Nor do I believe that America's vision for a just international order has become blurred. If
anything, the American vision has been sharpened since the terrorist attacks on New York and Washington; sharpened by the
realization that there is now a new struggle globally between the forces of openness and modernity, and the forces of separatism and
reaction. More than ever, America's interests lie in an open world economy resting on the foundation of a strong, rules-based
multilateral system. More and more, America's growth and security are tied to the growth and security of the world economy as a
whole. American leadership today is more — not less — important to our increasingly interconnected planet. A recent successful, and
much needed, example is the multilateral agreement on intellectual property rights and access to medicines for poor countries, in
which the US played a pivotal role. It would be a tragic mistake if the Doha Round, which offers the world a once-in-a-generation
opportunity to eliminate trade distortions, to strengthen trade rules, and open markets across the world, were allowed to founder.
We need courage and the collective political will to ensure a balanced and equitable outcome. What is the alternative? It is a
fragmented world, with greater conflict and uncertainty. A world of the past, not the future — one that America turned away from
after 1945, and that we should reject just as decisively today. America must lead. The multilateral
trading system is too
important to fail. The world depends on it. So does America.
Protectionism will cause global wars – risks extinction
Panzner 8 – faculty at the New York Institute of Finance, 25-year veteran of the global stock, bond, and currency markets who
has worked in New York and London for HSBC, Soros Funds, ABN Amro, Dresdner Bank, and JPMorgan Chase (Michael, “Financial
Armageddon: Protect Your Future from Economic Collapse,” p. 136-138)
Continuing calls for curbs on the flow of finance and trade will inspire the United States and other
nations to spew forth protectionist legislation like the notorious Smoot-Hawley bill. Introduced at the start of the Great
Depression, it triggered a series of tit-for-tat economic responses, which many commentators believe helped turn a serious economic
downturn into a prolonged and devastating global disaster. But if history is any guide, those lessons will have been long forgotten
during the next collapse. Eventually, fed by a mood of desperation and growing public anger, restrictions on trade, finance, investment,
and immigration will almost certainly intensify. Authorities and ordinary citizens will likely scrutinize the cross-border movement of
Americans and outsiders alike, and lawmakers may even call for a general crackdown on nonessential travel. Meanwhile, many nations
will make transporting or sending funds to other countries exceedingly difficult. As desperate officials try to limit the fallout from
decades of ill-conceived, corrupt, and reckless policies, they will introduce controls on foreign exchange. Foreign individuals and
companies seeking to acquire certain American infrastructure assets, or trying to buy property and other assets on the cheap thanks
to a rapidly depreciating dollar, will be stymied by limits on investment by noncitizens. Those efforts will cause spasms to ripple across
economies and markets, disrupting global payment, settlement, and clearing mechanisms. All of this will, of course, continue to
undermine business confidence and consumer spending. In a world of lockouts and lockdowns, any link that transmits systemic
financial pressures across markets through arbitrage or portfolio-based risk management, or that allows diseases to be easily spread
from one country to the next by tourists and wildlife, or that otherwise facilitates unwelcome exchanges of any kind will be viewed
protectionism will bring about ever more heated
arguments and dangerous confrontations over shared sources of oil, gas, and other key commodities as well as
with suspicion and dealt with accordingly. The rise in isolationism and
factors of production that must, out of necessity, be acquired from less-than-friendly nations. Whether involving raw materials used
in strategic industries or basic necessities such as food, water, and energy, efforts to secure adequate supplies will take increasing
precedence in a world where demand seems constantly out of kilter with supply. Disputes over the misuse, overuse, and pollution of
Around the world, such tensions will give
rise to full-scale military encounters, often with minimal provocation. In some instances, economic
the environment and natural resources will become more commonplace.
conditions will serve as a convenient pretext for conflicts that stem from cultural and religious differences. Alternatively, nations may
look to divert attention away from domestic problems by channeling frustration and populist sentiment toward other countries and
cultures. Enabled by cheap technology and the waning threat of American retribution, terrorist groups will likely boost the frequency
and scale of their horrifying attacks, bringing the threat of random violence to a whole new level.
Turbulent conditions will
encourage aggressive saber rattling and interdictions by rogue nations running amok. Age-old clashes will also
take on a new, more heated sense of urgency. China will likely assume an increasingly belligerent
posture toward Taiwan, while Iran may embark on overt colonization of its neighbors in the Mideast. Israel, for
its part, may look to draw a dwindling list of allies from around the world into a growing number of conflicts.
Some observers, like John Mearsheimer, a political scientist at the University of Chicago, have even speculated that an “intense
confrontation” between the United States and China is “inevitable” at some point. More than a few disputes will turn out to be almost
wholly ideological. Growing cultural and religious differences will be transformed from wars of words to battles
soaked in blood. Long-simmering resentments could also degenerate quickly, spurring the basest of human instincts and
triggering genocidal acts. Terrorists employing biological or nuclear weapons will vie with conventional forces using jets, cruise
missiles, and bunker-busting bombs to cause widespread destruction. Many will interpret stepped-up conflicts between Muslims and
Western societies as the beginnings of a new world war.
Scenario 2
First US noncompliance with Antigua undermines the WTO
credibility for resolving China Disputes
Levick, Esq., President and CEO of LEVICK, 12 (Richard, LEVICK represents
countries and companies in the highest-stakes global communications matters, was honored for
the past three years on NACD Directorship’s list of The 100 Most Influential People in the
Boardroom, 9-18-12, “Obama's Case against China: The U.S. Has a WTO Credibility Gap,”
http://www.forbes.com/sites/richardlevick/2012/09/18/obamas-case-against-china-the-u-shas-a-wto-credibility-gap/, accessed 8-6-14, CMM)
The Chinese have two good reasons to scoff dismissively at the Obama administration’s
trade case, filed yesterday at the World Trade Organization, which accuses them of unfairly subsidizing auto and
auto parts exports. The case specifically targets $1 billion in subsidies during 2009-2011, mainly of exports to developing countries
where the automobiles are assembled and purportedly compete with cars manufactured stateside. The U.S. is also about to take
further legal action in an ongoing WTO case against China that involves anti-dumping duties levied last year against American car
exports to China. China has filed its own counter-complaint with the WTO over anti-dumping duties that Washington had levied on
$7 billion-plus in various Chinese goods.) The first reason for the Chinese to balk is fairly obvious. President Obama is announcing
the initiative amid the heat of the election and he’s doing so in battleground Ohio. It’s a fair guess the Chinese will try to derail his
initiatives by highlighting the blatantly ulterior motives at play. The
second reason is even more important
because it potentially compromises any case the U.S. might bring before the WTO. It
involves an ongoing dispute, dating back to the early part of this century, between the government of Antigua and
Barbuda (“Antigua”) and the government of the United States. At issue is the total prohibition by the U.S. of crossborder gambling services provided via the Internet. Antigua has challenged that prohibition. It seems a
relatively narrow issue but there’s a catch: the WTO ruled on the matter and came heavily
down on the side of Antigua, which is the smallest WTO member to have ever opposed, much
less prevailed against, the organization’s largest member in such a proceeding. So far, however,
the U.S. has simply not complied with the ruling. We have neither lifted the restrictions nor
satisfied a damages penalty that continues to mount annually. It is levied each year the U.S. fails to pay up in
full. Typically, the United States takes a pretty high-minded approach to compliance
with global regimens of all sorts, from WTO rulings to anti-corruption initiatives. We have
aggressively sought a leadership role and more or less achieved it. Caesar’s wife must now be beyond
reproach. The consequences of hypocrisy are unacceptable, while only one instance of
non-compliance is needed to expose such hypocrisy. Never mind a blatantly political instance like the
current Obama case over auto and supply subsidies. Imagine you’re the People’s Bank of China, which has taken a number of steps
since 2001 that discriminate against foreign suppliers of electronic payment systems. On September 1, a WTO Panel Report found in
favor of a case brought by the U.S. “This decision makes it clear that China should honor its WTO commitments to play by the rules
and stop discriminating against American financial services providers,” said U.S. Trade Representative Ron Kirk. But why
should it play by the rules? We don’t, at least not in this case. A compromised WTO is
only one consequence of our non-compliance. Equally portentous, the WTO could itself approve violations of U.S.
intellectual property as fair retaliation for unfair trade practices. In 2010, for example, the U.S. settled a dispute with Brazil over
American subsidies to cotton growers, one day before Brazil was to begin sanctions – with WTO authorization – totaling $830
million. The sanctions included tariffs on such items as autos, pharmaceuticals, medical equipment, electronics, textiles, and wheat.
Brazil would also have been the first country to infringe American intellectual property rights with the WTO’s blessings. Brazilian
farmers would have no longer been charged fees for seeds developed by American biotech companies. American pharmaceutical
patents would have been directly violated prior to expiration. The prospective costs to U.S. businesses were estimated at $239
million. The
United States blinked then – and it better blink now in its dispute with Antigua, or risk
providing its global competitors with a powerful excuse for why they too can ignore the rules or
simply stonewall when called to task for doing so. The Antigua matter is especially intriguing
because it also raises a number of related questions about how global business is
trending in the Internet Age. In March 2003, Antigua took its case to the WTO after several months trying to
engage the U.S. in meaningful negotiations. A year later, the Dispute Panel Report found that the restrictions against online
gambling violated the General Agreement on Trade in Services (GATS) treaty. The ruling caused quite a stir in the gaming industry
as it presaged a new era of unambiguously legalized online gambling. The American position was that our federal law simply
prohibits all betting and gambling services provided by non-U.S. interests. So in 2005, the WTO heard and ruled on an appeal,
finding that: (1) free trade in gambling was indeed one of the commitments we made to GATS; (2) that we had adopted “measures” –
including the 1961 Interstate Wire Act prohibiting the use of wire communication facilities to convey bets – that interfere with that
commitment; and that (3) we could not rely on a “moral defense,” i.e., that gambling is immoral and the public needs to be protected
from it. The WTO explained that any moral defense in this case was obviated by, for one, the interstate online horse race betting that
is today altogether legal. The WTO gave the U.S. eleven months to either allow Antigua to provide online gambling or prohibit
domestic online horse betting. So much for morality! For the U.S., the WTO decision requires a re-haul of the Wire Act so that it is
compatible with our GATS commitment and, in a broader sense, adjusted to the realities of the digital age in a global economy. But
the initial response from the U.S. Trade Office was that it would not ask Congress to weaken restrictions. Then came the penalties. In
2007, the WTO awarded Antigua $21 million in annual damages. The tab has now accumulated to over $120 million. Throughout,
the Antiguans have seemed most reasonable. This August, their government approached the WTO, seeking a compromise on the
damages issue even as it assembled a team to come up with further solutions for consideration by both the U.S. and WTO.
Meanwhile, the
interminable American foot-dragging only encourages others in the
world to disregard any pressure we might try to impose on how they should “play
by the rules.” There are numerous lessons in this saga for American lawmakers. First, they need to realize what their
constituents think. A 2006 Zogby poll commissioned by Antigua found that over 70% of Americans do not want the government to
stop online betting. Lawmakers and enforcers should also view the Wire Act in context. In light of all the complex legal issues that
Internet commerce has raised in the past two decades, isn’t it reasonable that a 1961 law governing wire communications ought to be
revisited under any circumstances? Bear in mind too the intent of the Wire Act, which then-Attorney General Robert Kennedy saw
mainly as a weapon against organized crime. The good news is that the DOJ has already showed some flexibility; notably, it reversed
its position last year by exempting lotteries from Wire Act enforcement. Perhaps the tide is slowly turning in favor of Antigua. Yet
this story is not just about gaming, nor is it just about Antigua. It is also about our own legal and competitive preparedness for the
digital age, and how that preparedness affects our credibility in the global marketplace. After all, it would be a shame to see
American companies lose millions in intellectual property because of our insistence that a 1961 law must govern technologies that
were unimagined when the law was written. Innovation
and leadership are inseparable. If our policies, legal
and otherwise, do not evolve in tandem with marketplace realities, we will inevitably fail our
own standards at every level. There are people throughout the world who are just salivating to see that happen.
Recent WTO ruling has told China to amend REE export policies, but
compliance isn’t certain
AFP 8/8 (Chim Sau-wai- South China Morning Post contributor, and
Agence France-Presse in Geneva, 2014, “China loses appeal against
WTO ruling on curbs on trade in rare earths Trade body upholds its
ruling that export restrictions on the minerals violate rules”,
http://www.scmp.com/business/commodities/article/1568966/china
-loses-appeal-against-wto-ruling-curbs-trade-rare-earths)
China says it "strongly regrets" a decision by the World Trade Organisation to uphold its
ruling that the country violated global trade rules by restricting exports of rare earth elements,
used in hi-tech goods like mobile phones and televisions. The WTO's appeal body upheld its
ruling of March this year, which found China's export restrictions - including duties, quotas and
restrictions of trade rights on rare earth elements and the metals tungsten and molybdenum were not justifiable and breached trade rules. The decision is final and, in principle, WTO
member states are obliged to follow the ruling. "China will carefully assess the ruling [and] continue to
improve its management of resource-consuming products in a WTO-consistent manner," the Ministry of Commerce said. The ministry added that it would "take future steps consistent with the WTO dispute
settlement system requirements". China has argued that the export restrictions are related to the conservation of its natural resources, and are necessary for reducing the pollution caused by mining. "Due to the
need to protect exhaustible natural resources and the environment, the Chinese government has been enhancing its management of products that [pollute and consume resources on a large scale]," the ministry
said. But the complainants, including the United States, the European Union and Japan, said the restrictions were designed to provide Chinese industries with protected access to the materials. They lodged the
China accounts for 95 per cent of global production of rare earths, a term
covering 18 metals vital for the production of smartphones, hybrid car batteries, wind turbines,
steel and low-energy light bulbs. The country is home to 23 per cent of global reserves of such
metals. The WTO's appeal body said in a report on Thursday that China had "not demonstrated that the export
quotas [it] applies to various forms of rare earths, tungsten and molybdenum are justified" and
called on Beijing to fall in line with international trade rules. EU Trade Commissioner Karel De
Gucht said the ruling was "another milestone in the EU's efforts to ensure fair access to muchneeded raw materials for its industries".
complaint with the WTO in 2012.
Failure of China to change export restrictions makes US lash out
inevitable- results in war and relations collapse
Parthemore 11 (Christine Parthemore, Fellow at the Center for a New American Security
(CNAS), where she directs the Natural Security Program and the Natural Security Blog, prolific
author, former journalist writing for The Washington Post, Roll Call, and the Atlanta JournalConstitution, MA from Georgetown University's Security Studies Program, June 2011,
“ELEMENTS OF SEUCURITY: MITIGATING THE RISKS OF U.S. DEPENDENCE ON
CRITICAL MINERALS,” Center for a New American Security,
http://www.cnas.org/files/documents/publications/CNAS_Minerals_Parthemore_1.pdf)
Minerals are a subject of much contention. On one hand, the United States remains less prepared for supply disruptions, price spikes and
trade disagreements related to the global minerals trade than most experts realize. On the other hand, public concern over reliable access
to the minerals required in key sectors of the U.S. economy, in particular those needed to produce military equipment, is growing. Too
frequently, however, such concerns are based on inaccurate assumptions. A sober and informed analysis suggests there are real
vulnerabilities, which place critical national security and foreign policy interests at risk. In worst-case scenarios, supplies of minerals that
the United States does not produce domestically may be disrupted, creating price spikes and lags in delivery. Even short of major supply
The
United States may also lose ground strategically if it continues to lag in managing mineral issues, as
disruptions, supplier countries can exert leverage over the United States by threatening to cut off certain key mineral supplies.
countries that consider assured access to minerals as far more strategically important are increasingly setting the rules for trade in this
area. China’s rising dominance is at the heart of this growing public debate. Its
2010 cutoff of rare earth elements2 – a
unique set of minerals that are difficult to process yet critical to many hightech applications – attracted particular attention. After
Japan detained a Chinese trawler captain over a skirmish in the East China Sea, Japanese companies reported weeks of stalled shipments of rare earths from China amid rumors of an
official embargo. This may sound like a minor trade dispute, but China currently controls production of about 95 percent of the world’s rare earths, which are critical to building laserguidance systems for weapons, refining petroleum and building wind turbines. Coinciding with possessing this incredible leverage over the rest of the world, China has also reduced its
export quotas for these minerals. For its part, the Chinese government contended that it did not put any formal export embargo in place, and that its plans to reduce exports simply reflect
the need to meet growing domestic demand for rare earths. Japan-China relations experienced further strain in their already tense relationship. In the United States, many reporters,
policy analysts and decision makers did not foresee this challenge. Feeling blindsided, some in the United States
characterized the situation in a manner that demonized China rather than using the opportunity to
better understand the true nature of U.S. supply chain vulnerabilities. The 2010 rare earths case and others are increasing interest in
critical minerals among U.S. policymakers. Congress held hearings on the strategic importance of minerals between 2007 and 2010, and the 2010 National Defense Authorization Act
required DOD to study and report on its dependence on rare earth elements for weapons, communications and other systems.3 During a 2009 hearing on minerals and milit ary readiness,
Republican Representative Randy Forbes of Virginia called minerals, “one of those things that no one really talks about or worries about until something goes wrong. It’s at that point –
the point where we don’t have the steel we need to build MRAPs [Mine Resistant Ambush Protected vehicles] or the rhenium we need to build a JSF [Joint Strike Fighter] engine that the
stockpile becomes critically important.”4 In October 2010, Secretary of State Hillary Rodham Clinton stated that it would be “in our interests commercially and strategically” to find
additional sources of supply for rare earth minerals, and stated that China’s recent cuts to rare earth exports “served as a wakeup call that being so dependent on only one source, disruption
could occur for natural disaster reasons or other kinds of events could intervene.”5 In January 2011, Sen. Mark Begich, D-Alaska, Sen. Lisa Murkowski, R-Alaska, and Rep. Mike Coffman,
R-Colo., wrote a letter to Defense Secretary Robert Gates expressing concern for minerals required for producing defense equipment such as Joint Direct Attack Munitions (JDAMs),
which stated, “Clearly, rare earth supply limitations present a serious vulnerability to our national security. Yet early indications are that DOD has dismissed the severity of the situation
to date.”6 Additionally, the Department of Energy (DOE) launched a multiyear effort to explore potential vulnerabilities in supply chains for minerals that will be critical to four distinct
policymakers often focus too narrowly on what may seem the most
compelling indicators – usually import dependence or scarcity – in prescribing solutions to reduce U.S. vulnerabilities, in
particular to supply disruptions in critical minerals such as rare earths. This focus is sparking protectionist attitudes,
areas of energy technology innovation. While concern is growing, the media and
with some worrying that import dependence poses an inherent risk to the U.S. economy. Discussion of minerals also frequently focuses
on supply scarcity and resource depletion in absolute terms. However, both the rhenium and rare earth minerals disruptions of the past
five years were triggered by deliberate decisions made by political leaders to leverage their positions of strength, not by market forces,
Countries often revert to hoarding, pressuring suppliers and otherwise
behaving as if scarcities are present even when they are not, based solely on concerns that shortages are likely in
disorder or scarcities of these minerals.
the near term. In fact, neither scarcity nor import dependence alone is sufficient to signal vulnerability, and a combination of factors
including concentration of suppliers is most often required for mineral issues to become security or foreign policy problems.
This report,
based on two years of research, site visits and discussions with stakeholders, explores how the supply, demand and use of minerals can
impair U.S. foreign relations, economic interests and defense readiness. It examines cases of five individual
minerals – lithium, gallium, rhenium, tantalum and niobium – and rare earth elements, such as neodymium, samarium and dysprosium, as
a sixth group in order to show the complexity of addressing these concerns. Each of these minerals is critical for defense technologies and
U.S. economic growth plans. They share characteristics with minerals that have caused important political or economic concerns for the
United States in the past. Additionally, lithium is frequently cited in the media and in discussions of how clean energy supply chains are
critical to meeting America’s future economic, energy and environmental goals. Within
the past five years, two of these cases –
rhenium and rare earth minerals – have involved supply disruptions or important threats of disruptions for the
United States and its allies. Each of these minerals will require federal government attention in the coming years. Pg. 6-10
War over minerals is likely- any alt to Chinese markets are
guaranteed to fail
Hinten-Nooijen 10 (Dr. Annemarie Hinten-Nooijen, Professor of Economics at Tilburg
University in the Netherlands, 3/25/10, “Rare minerals – The treasures of a sustainable
economy”, http://www.tilburguniversity.edu/nl/over-tilburg-university/cultuur-ensport/cwl/publicaties/beschouwingen/minerals/)
Driving a hybrid car, using energy from wind turbines or solar panels. That are choices to contribute to the transition to a sustainable
economy. Sustainability is the spearhead of many western policy plans. It is regarded as the solution to get out of the crisis. But ironically,
the raw materials that are needed for hybrid cars and wind turbines, for our technological industry as a whole,
are not that sustainable. Necessarily required minerals like neodymium and indium are rare. And they are not available in the
west, China has almost all of them. And having this position of power, China wants to use it. That is about strategy. The high-tech raw
materials play a central part in the highly industrialised high-wage countries to survive the global competition by technological excellence.
Will future wars be about minerals instead of oil, territories or water? THE BONE MARROW OF MODERN
ECONOMY Minerals are an indispensable material pillar of our current economies and societies. They are
the natural product of geological processes and occur in the crust of the planet. Only a fraction of the known minerals exists in greater
quantities. Some of these are mined, refined and processed; are broken up into their elemental components, which are recombined into
different types of materials. These
materials are used to manufacture products that form the backbone of
our modern economies: from LCD displays to fighter jets, from smart phones to electric cars. Without minerals,
industrial society and modern technology would be inconceivable. That seems unbelievable, because we hardly
hear or read about them in the media - whereas several research reports have been published recently. But imagine that by reading this
article on printed paper or at your computer screen, minerals like nickel, chromium, molybdenum, gallium, selenium, aluminium, silicon
and manganese were needed! And all these elements have to be first extracted from minerals, which in turn need to be mined from the
earth's crust. CHINA'S GREEN DEAL In recent years, the world economy has grown enormously, and many new high-tech applications
have been made. Moreover, the demand for minerals has exploded. Mining tried to meet the demand. A global
Prices have shot up, countries have
created strategic stockpiles or imposed export restrictions in order to secure supplies of these
valuable resources. Mineral scarcity concerning the industry seems to be more of an economic issue than an issue set by limited
competition between countries and companies over rare mineral resources started.
resources. Minerals are getting evermore difficult to find and costly to extract - while they are the key to advanced sustainable
technologies. Talking about sustainability seems not talking about China, because China is still building many polluting coal-fired power
plants, and the social circumstances there are poor. However, recent developments also show progress concerning sustainability. And in
a country like China these developments go faster than in many western democracies. Where we in the west talk and dawdle, they think
and act strategically. In the United States, president Obama has to explain the Americans that forms of the New Green Deal are inevitable
- like the situation in the thirties of the last century, when President Roosevelt made the so-called New Deal to reform the economy. Many
Americans do not want the government to influence the market. They radically believe in the free market. In China, by contrast, the
ideological separation between market and government does not exist. There is no Wall Street with greedy bankers, no neoconservative
Grand Old Party that dreams of the cowboy economy. Decisions are taken quickly. And besides, they have to feed one billion people and
develop a country that lived in Mao-ist poverty before. The Chinese are successful, after all, also in creating a sustainable economy: China
does not only build old polluting power stations but uses the latest technology, with CO2- catch and -storage. And they are working on
alternatives: windmills. In the next five years, they will build 100,000 windmills in the Gobi desert. Did they hate the wind in that area
before, now they consider it the new gold. In the north-west area of China, the province of Gansu, the Qilian-mountains pass into the Gobi
desert. There China is building the biggest windmill and solar panel park in the world. Six windmill parks with a capacity of ten gigawatts
each are built, making China the biggest market of technology of wind energy, defeating the United States. "Red China becomes green
China", party officials are saying. China has to grow, and so has the contribution of wind, water and sun at the energy market. This market
would be interesting for foreign investments. According to Chinese officials they are welcome and can get subsidies. But, Beijing has
decided that 70 percent of the windmills have to be made and designed in China. So it can be questioned if European and American
companies have a fair chance in tendering for a contract. China considers itself a developing country and thinks that the western countries
should contribute money to China to reduce the CO2 discharge. While America thought that energy saving is not worthwhile, China has
taken an enormous energy-technological lead. The authoritarian and undemocratic but intelligent China exposes a variant of the New Deal.
THE OPEC OF THE RARE MINERALS The example of China shows us that sustainable economy has everything to do with strategy and power.
In a few decades China has been flooding the market of rare metals. The legend goes that president Deng Xiaoping
had already predicted this in 1992, during a tour in the south of China: "They [the Mid East] have oil, but we in China have rare minerals".
Nowadays, China indeed has 95 percent of the global supply of rare minerals. How did it do that? It was a
result of good strategy: in the nineties, China flooded the world market with the rare minerals, although there was not that much demand.
The west thought it okay because getting the minerals was a very expensive production process and the environmental legislation was
The western competitors went bankrupt and they closed their mines. China became
powerful. One of the centres of the rare mineral supply is around the city Baotou, an industrial city of two million people in Inner
very strict.
Mongolia. Here the states concern exploits almost half of the world storage of neodymium. DISRUPTION OF THE MARKET The lack of raw
materials is not particularly a result of the geological availability but of disruptions in the market, because the developments of the world
wide demand for rare minerals are not recognised in time - as part of the stormy development of the Chinese economy and the expansion
of technical developments - and because the minerals occur in only a few countries. Experts have predicted that in the next few decades
the demand of neodymium will increase by a factor 3.8. China uses 60 percent of its exploitation for its own economy. What's more, the
Chinese export quota become stricter every year. What happens? Sudden peaks in the demand can lead
to speculative price movements and a disruption of the market. "2010 will be the year of the raw materials",
according to Trevor Greetham, Asset Allocation Director of Fidelity. Indium, a silver-white metal, which is not found directly in nature, but
is a residual product of thin and zinc, is used in LCD displays for TVs, computers, mobile phones, and for led lights and the ultrathin and
flexible solar panel. The price of this mineral multiplied tenfold between 2003 and 2006 from 100 to 980 Dollars per kilogram. The price of
neodymium decreased from 11.7 dollar per kilogram in 1992 to 7.4 dollar in 1996. The market volume rose. In 2006 almost all of the world
production of 137,000 tons came from China. By scaling back the export, prices rose, up to 60 dollar per kilogram in 2007. Imagine that for
a hybrid car, like the Toyota Prius or the Mercedes S 400, you need at least 500 grams of neodymium for the magnetic power of the engine;
and for the newest generation of wind turbines, the ones that are 16 meters high, you need about 1000 kilogram. That makes 60,000
dollars - for just a little bit of metal! Big business for China. At the same time, China makes further strategic investments: it took an interest
in oil and gas fields. In August 2009, PetroChina paid 41 billion dollar to gain access to an enormous field of natural gas in front of the coast
of Australia. And in September that year, it obtained a stake of 60 percent in the exploitation of fields of tar sand in Alberta, which might
hold one of the biggest oil reserves in the world. And because China considers titanium a growing market, it took an interest of 70 percent
in a titanium mine in Kenia - not only to build the Chinese 'Jumbojet', but also to provide Boeing with 2000 tons of titanium each year. By
doing so, China might beat the competition in the battle for the market in green technologies. The 'free' market can be questioned. The
mineral policies of China and the US both mention the usage of administrative barriers. These nontariff barriers involve regulations that
seek to protect the national mineral extraction industry. As a result, it is much harder for foreign companies, if not impossible, to invest
and gain a foothold in the national mineral extraction industry in these countries. The search for rare metals has become a global race: a
mine in California has also been reopened, the mine of Mountain Pass. In 2008, it was bought by a group of investors, the partnership
'Molycorp Minerals'. The process of bringing the old mines into use costs much time and money. What does this mean for us? Do we get
more dependent of China? The 'Innovationplatform' in Rotterdam planned to build a unique windmill park in the sea, further from the
coast and in the strongest sea wind than anywhere in the world. To build these windmills, we need rare minerals, the export of which is
dominated by China. Part of the project is Darwind, which designed enormous windmills for at sea. But the umbrella company, of which
Darwind is part, Econcern, was about to go bankrupt. Then, in mid-August 2009 it was saved by the, surprisingly, Chinese XEMC. THE
The transition to a sustainable economy involves underexposed
elements like deficiency in minerals and shifting balances of power. They are the ideal receipt for
geopolitical instability. The new world order will be a balance between countries that do have
particular raw materials and ones that do not. The lack of indispensable minerals sharpens the
relations in the world. The access to critical minerals is more and more an issue of national security,
THREAT OF GEOPOLITICAL INSTABILITY
concluded the 'The Hague Centre for Strategic Studies' (HCSS) in its report about the scarcity of minerals (January 2010). The US, Japan
and China are making a policy that tries to secure the supply of these raw materials. That will disturb the free market activity. HCSS thinks
that large concerns will, with support of the government, compete more intensively with each other for access to these raw materials, e.g.
by direct investments in areas rich in raw materials. Mineral scarcity will be an issue in the next decades, though it is uncertain when and
to what extent. And we have to do something because a change in supply of rare minerals directly affects our current
modern lives.
Compliance failure guarantees war- cyber escalation overwhelms
your defense
Anthony, 11 [12/30, Lead Editor at Ziff Davis Inc. Graduated from the University of Essex,
Columnist, Editor at AOL News, “Rare earth crisis: Innovate, or be crushed by
China”http://www.extremetech.com/extreme/111029-rare-earth-crisis-innovate-or-be-crushedby-china/2]
The rare earth apocalypse¶ The doomsday event that everyone is praying will never come to pass, but which every Western nation is
currently planning for, is the eventual
cut-off of Chinese rare earth exports. Last year, 97% of the world’s
rare earth metals were produced in China — but over the last few years, the Chinese government
has been shutting down mines, ostensibly to save what resources it has, and also reducing the amount of
rare earth that can be exported. Last year, China produced some 130,000 tons of rare earths, but export restrictions
meant that only 35,000 tons were sent to other countries. As a result, demand outside China now outstrips supply
by some 40,000 tons per year, and — as expected — many countries are now stockpiling the reserves that they have.¶ Almost every
Western country is now digging around in their backyard for rare earth-rich mud and sand, but it’ll probably be too little too late —
and anyway, due to geochemistry, there’s no guarantee that explorers and assayers will find what they’re looking for. The
price
of rare earths are already going up, and so are the non-Chinese-made gadgets and gizmos that use them. Exacerbating
the issue yet further, as technology grows more advanced, our reliance on the strange and magical
properties of rare earths increases — and China, with the world’s largest workforce and a fire hose of rare earths, is
perfectly poised to become the only real producer of solar power photovoltaic cells, computer chips,
and more.¶ In short, China has the world by the short hairs, and when combined with a hotting-up
cyber front, it’s not hard to see how this situation might devolve into World War III. The
alternate, ecological point of view, is that we’re simply living beyond the planet’s means. Either way, strategic and logistic
planning to make the most of scarce metals and minerals is now one of the most important tasks
that face governments and corporations. Even if large rare earth deposits are found soon, or we start recycling our gadgets in
a big way, the only real solution is to somehow lessen our reliance on a finite resource. Just like oil and energy, this will probably
require drastic technological leaps. Instead of reducing the amount of tantalum used in capacitors, or indium in LCD displays, we
will probably have to discover completely different ways of storing energy or displaying images. My money’s on graphene.
Extinction
Wittner 11 (Lawrence- Professor of History emeritus at SUNY/Albany, huffingtonpost
writer, “Is a Nuclear War With China Possible?”, 11/30,
http://www.huffingtonpost.com/lawrence-wittner/nuclear-war-china_b_1116556.html)
Of course, the
bottom line for those Americans convinced that nuclear weapons safeguard them
from a Chinese nuclear attack might be that the U.S. nuclear arsenal is far greater than its
Chinese counterpart. Today, it is estimated that the U.S. government possesses over 5,000 nuclear
warheads, while the Chinese government has a total inventory of roughly 300. Moreover, only about 40 of these Chinese nuclear
weapons can reach the United States. Surely the United States would "win" any nuclear war with China. But
what would that "victory" entail? An attack with these Chinese nuclear weapons would
immediately slaughter at least 10 million Americans in a great storm of blast and fire, while
leaving many more dying horribly of sickness and radiation poisoning. The Chinese death toll in
a nuclear war would be far higher. Both nations would be reduced to smoldering, radioactive
wastelands. Also, radioactive debris sent aloft by the nuclear explosions would blot out the sun
and bring on a "nuclear winter" around the globe -- destroying agriculture, creating worldwide
famine, and generating chaos and destruction.
Adv 2
UIGEA regulations crowd out small banks, cause economic
stagnation, and guarantee stock market collapse
Wajda 2007 (Nicholas [B .A. Economics, Furman University, 2005; J.D. candidate,
Thomas Jefferson School of Law]; NOTE: OVER-PLAYING A WEAK HAND: WHY GIVING
INDIVIDUAL STATES A CHOICE IS A BETTER BET FOR INTERNET GAMBLING IN THE
UNITED STATES; 29 T. Jefferson L. Rev. 313; kdf)
C. A Bad Beat: Problems with Forcing Financial Institutions to Regulate the Industry
As previously discussed, the UIGEA requires the Attorney General and directors of the Federal
Reserve System to prescribe regulations forcing all United States financial [*332] institutions
to "identify and block or otherwise prevent or prohibit" financial transactions relating to
unlawful Internet gambling. n124 The problem is, once such regulations are in place, the burden
of enforcement shifts from the government to each respective financial institution.
Consequently, to ensure compliance with governmental regulations, every category of financial
institution must appropriate time and money to monitor every financial transaction occuring
under its control.
Such responsibility is sure to put an enormous burden on United States financial institutions.
n125 Although currently it is unknown what the actual regulations will be, as one commentator
notes, "trying to sort out which payments they can accept and which they must reject will be a
cumbersome - and expensive - enterprise." n126 Such burden and expense may not be a
problem for large companies such as Bank of America or American Express, but forcing
smaller startup banks, credit companies, credit unions, and fund transferring businesses to
comply with sufficient monitoring of all financial transactions may quickly force such
companies out of business. Think of local banks and credit unions in some of the smaller
cities around the United States. These institutions tend to be smaller, sometimes non-profit
entities that help the community by providing higher interest rates, yet they do not have the
funds, technological resources, or personnel to successfully monitor what their customers are
spending their money on. Hence, this heavy burden may force such helpful services to shutdown
or face severe penalties from the Federal Functional Regulators or the Federal Trade
Commission. n127
Even assuming United States financial institutions have the resources and money to comply
with the new federal regulations, a question arises about what effect such "monitoring" of every
transaction will have on the efficiency of the flow of money. This "monitoring" could
significantly delay the flow of money [*333] within the United States and needlessly
overburden those who have been accustomed to the speed and efficiency of online banking.
Additionally, delays in the flow of money could have serious effects on the growing Internet
stock market, or e-trade, industry. In the stock market, time-consuming delays can result in
major losses for investors. Thus, any delay in the flow of money between these sites and the
market could have serious consequences on individual traders and the e-trade business as a
whole.’’
UIGEA regulations undermine US dollar hegemony and crush the
economy
Leonard 2009 (Brant M [B.S., Central College; J.D. Candidate, Drake University Law
School, 2009]; Highlighting the drawback of the UIGEA: Proposed Rules Reveal Heavy
Burdens; 57 Drake L. Rev. 515; kdf)
IV. Burdens on U.S. Financial Institutions: Problems and Questions Before and After the Proposed Rules In
order to
understand the proposed rules recently published for the implementation of the UIGEA, it is
important to understand what they were meant to do. The enactment of the UIGEA put U.S. financial
institutions on notice of a coming burden, but left the particulars to the Federal Reserve Board and Treasury
Department, which would jointly publish rules and regulations for the implementation of the UIGEA. n154 Commentators agree
that due to the shift in regulatory responsibility from traditional law enforcement to U.S.
financial institutions, the economic impact on U.S. financial institutions will be extremely
burdensome. n155 However, after the enactment of the UIGEA, but before the proposed regulations were published, U.S. financial
institutions were left with many unanswered questions about the specifics of that burden - questions that the proposed rules would
ideally answer. n156 As it turned out, the proposed rules answered some questions while leaving some important ones unanswered.
n157 Through an analysis of these questions and attempted answers, one can more clearly see that the difficulty in drafting rules for
implementation reflects more fundamental problems with the UIGEA itself. The
concerns of U.S. financial
institutions were, and still are, widespread. As an initial matter, financial institutions were concerned with the problems of
enforcement already articulated in this Note. The majority [*537] of Internet gamblers do not use direct
transacting practices from their own U.S. bank accounts to online casinos, but rather take
advantage of offshore third-party payment processors like PayPal or Neteller, commonly referred to as "ewallets." n158 The existence of e-wallets left several unanswered questions following the initial enactment of the UIGEA . The
most fundamental of these questions simply inquired as to whether e-wallets were included in
the term "designated payment system" under the UIGEA, and would thus potentially subject U.S. financial
institutions to liability if they forwarded funds to these accounts, and the accounts were, in turn, used in conjunction with online
gaming. The main concern is clear - if
e-wallets are included, the burden of policing is much more
extensive. In short, if these types of third-party accounts are included as "designated payment systems," financial
institutions must concern themselves with what the money is used for once they have
transmitted it to an e-wallet account operated by a third-party entity. For the rule makers, this issue, like
many other concerns, points toward the central difficulty in drafting rules for implementation of the UIGEA. The broader the rules
are made, the greater the burden (and uncertainty) that is placed on U.S. financial institutions. On the other hand, the narrower the
rules, the less impact the UIGEA is likely to have on prohibiting online gaming. This, like
several drafting difficulties,
points toward the fundamental problem with the enforcement mechanism of the UIGEA itself.
Because the UIGEA relies on financial institutions to police Internet casinos, the decision on
each rule posits a choice between creating a larger burden on U.S. financial institutions or making
the prohibition less effective in practice. On this front, however, the proposed rules do answer the question of whether e-wallets are
included, and the answer is yes. n159 In fact, the rules make mention of PayPal as an example of a "money transmitting business."
n160 While there is an answer, it is troubling for U.S. financial institutions because of the difficulty in monitoring e-wallets. Ewallets are typically offshore businesses that nearly always make use of foreign banks. n161 As a result,
the burden on U.S.
financial institutions extends [*538] beyond policing their own transactions with e-wallets and
now forces them to deal with the uncertainty of whether they must police transactions between
other institutions and e-wallets, which may ultimately lead to online gaming transactions. On this
front, the proposed rules provide some guidance, but leave U.S. financial institutions largely uncertain about
their duties under the UIGEA. The proposed rules make clear that for two types of payment systems that have the benefit
of merchant coding - card systems and money transmitting systems - U.S. financial institutions will carry the burden of monitoring
extended transactions. n162 With
respect to check collection and wire transfer systems, some of these
types of extended transactions will be exempt from the UIGEA's imposition of duty. n163 In the case
of outgoing transactions to foreign banks, the exemption applies. However, with respect to incoming requests from foreign
institutions, the
first U.S. institution to participate in the transaction does have the burden of
investigating and putting procedures in place to discover and block any transaction related to
online gaming. n164 Again, the answer is not good news for U.S. financial institutions, as their burden of policing the
online gaming industry extends further than initially expected with respect to extended
transactions. As will be discussed later, even with respect to those exempted transactions, the difficult question of determining
which non-exempted transactions are illegal remains. Further, the answer again points toward the fundamental
problem posed by the enforcement mechanism of the UIGEA itself. With respect to outgoing transactions,
the burden is presumably too great, and therefore an exemption applies. As a result, this would seem to provide a funding avenue for
bettors to continue to gamble online. With
respect to incoming requests, policing is required to some extent.
This effectively enforces the aim of the UIGEA, but in turn places a larger burden on U.S.
financial institutions that are already charged with the task of monitoring payments related to
Internet pornography and terrorism. n165 A second problem posed by e-wallets has a lesser impact on the costs of
monitoring but a greater impact on the costs incurred by over- [*539] deterrence. E-wallets, like PayPal, are often used to mix legal
and illegal transactions. n166 Therefore, a
U.S. financial institution concerned with blocking payments
through e-wallets may intend to block an Internet bet while actually blocking a legitimate
Internet purchase. Thus, the burden of deciphering what type of transaction is being made with an
e-wallet creates a significant increase in the monitoring burden of U.S. financial institutions. n167
The proposed rules seem to establish this heightened burden with its (at least partial) inclusion of e-wallets in the definition of
designated payment systems. n168 A second concern of U.S. financial institutions, particularly banks, was whether they would be
saddled with the burden of monitoring personal checks. One source notes that this would amount to the manual inspection of
approximately forty billion checks per year. n169 Fortunately, the proposed rules give good news to U.S. financial institutions by
creating an exemption for personal paper checks. n170 While this is good news for U.S. financial institutions, it again points toward
the internal tension in the UIGEA. The inclusion of personal checks would create an overwhelming burden on U.S. banks, and
therefore, personal checks are exempted. On the other hand, the exclusion allows online gaming to continue through certain
channels. A
more central concern to the U.S. financial institutions is what is meant by "unlawful
Internet gambling." As written, the UIGEA gives no specific definition, but rather relies on state and federal law to determine
what is "unlawful." n171 Following the enactment of the UIGEA, the primary concern of U.S. financial
institutions was whether a specific definition would be given by the proposed rules, or whether
the burden [*540] would be on the institutions to determine if a given transaction is legal or
illegal under the laws of many differing jurisdictions. This seems a fair question considering that the Fifth Circuit
and the DOJ disagreed over what gaming activities are unlawful under the Wire Act. n172 Unfortunately for U.S. financial
institutions, the proposed rules fail to give a more specific definition of unlawful Internet gaming. The rules instead defer to the
language of the UIGEA itself stating, "The proposed rule does not specify which gambling activities or transactions are legal or illegal
because the Act itself defers to underlying State and Federal gambling laws in that regard ... ." n173 In addition to the problems
associated with interpreting the law of many different jurisdictions, determining what is unlawful is further intensified by the
UIGEA's express exemptions for intrastate, intratribal, and interstate horseracing transactions. n174 It
is arguable that by
burdening U.S. financial institutions with the responsibility of determining what is legal and
illegal among numerous state and federal gaming laws, as well as the responsibility to identify and block
restricted transactions, the UIGEA rules, as proposed, result in an appropriation of private resources for
government purposes. After all, the proposed rules give no clear definition, leaving financial institutions to study and
interpret the laws of numerous jurisdictions. Again, the rule makers were forced to choose between
heightening the burden on the financial institutions and negatively affecting the impact the
UIGEA will have on Internet gaming - a result that is caused by the fundamental nature of the UIGEA's enforcement
mechanism. Given the uncertainty inherent in the UIGEA's rules, it is no surprise that U.S. financial institutions
are speaking out in the wake of the proposed rules. n175 The Financial Services Roundtable, representing many
U.S. financial institutions, states that the UIGEA, under the proposed rules, forces financial services entities to perform police
functions more [*541] appropriate for law enforcement agencies. n176 Bank of America has stated that it will be forced to block
legitimate transactions in an attempt to enforce an ambiguous law. n177 Further, counsel
for the American Bankers
Association has characterized the UIGEA's provision under the proposed rules as a "compliance
trap." n178 The concern of U.S. financial institutions saddled with this additional burden in light
of the proposed rules has not gone unnoticed by Congress. In a December 2006 letter to the Treasury
Department and Federal Reserve, sixteen Representatives criticized the proposed rules as overbroad and ambiguous. n179 Because
the proposed rules provide no clearer definition of what an illegal transaction is, U.S.
financial institutions are saddled
with an incredible burden. It is up to the institutions, not law enforcement personnel, to put an end
to online gaming. The amount of resources necessary to investigate each transaction in order to
determine if it violates the laws of one or more of over fifty jurisdictions is sure to
weigh heavily on U.S. financial institutions. Aside from the resources that must be expended by financial
institutions, slowing down the payment processing function of the U.S. economy could have devastating implications. For example,
Internet
stock market trading is a time-sensitive industry that relies heavily on the speed and
ease with which transactions can be processed. Under the proposed rules, it is likely that the serious
burden of policing transactions will slow the payment processing systems of U.S. financial
institutions, thus impacting other Internet industries. Further, as one commentor suggested, slowing down
the payment processing systems of U.S. financial institutions could have disastrous
implications for the continuation of the U.S. dollar as the world's reserve currency .
n180 The final major question left to U.S. financial institutions regards the cost of implementation and maintenance of the required
policing structures. The question remained after initial enactment of the UIGEA whether any appropriations for implementing the
compelled regulatory systems would be made. Under the proposed rule, it appears that any cost [*542] of implementing and
maintaining the policing functions will rest solely with the financial institutions. n181 The proposed rule does contain a cost estimate
for the recordkeeping function of the compelled regulatory, which is set at $ 4 million annually. n182 Of course, this is only a modest
estimate of what will be needed to maintain records year-to-year, and it ignores many other costs of implementation and
maintenance. The
actual costs to U.S. financial institutions are not even considered by the proposed
rules. While many commentators have mentioned that it indeed will be a burden, an understanding of the different types of costs
is necessary to fully appreciate the impact of the UIGEA on U.S. financial institutions. n183 Articles advising U.S.
financial institutions in preparation for the proposed rules are particularly helpful in pointing
out costs that will be incurred by the institutions. An article in the Banking Law Journal by Cynthia Ricketts,
James Halpert, and Allison Harvey includes a list of steps that should be taken by U.S. financial institutions in preparation for the
UIGEA. n184 Most of the advised steps are helpful indicators of where compliance costs will be incurred. As an initial matter, the
authors suggest that financial institutions "monitor changes in the regulation of Internet payments." n185 This is a reasonable and
necessary step for U.S. financial institutions to take as they proceed with their policing burden. It also reflects a large source of the
costs associated with implementation of the UIGEA. As the world of gaming legislation continues to develop, bank executives,
employees, and particularly compliance personnel will be charged with the task of staying up-to-date on what is or is not a restricted
transaction. Costs in this area are sure to involve increased training in identifying restricted transactions, an added need for
resources in compliance departments, and constant research and analysis. Aside from this problem, the troubles already discussed
in defining what is unlawful will play a large part in increasing the costs necessary to monitor the stance of individual jurisdictions
on different transactions. [*543] The
authors also suggest developing an internal policy for accepting
customers and for identifying and blocking restricted transactions. n186 The development of such a system
represents another large cost of implementation. Again, this step raises the same concerns of expending
resources on the determination of what is currently unlawful. Moreover, for many banks and other financial
institutions, this involves an extensive system of new internal controls, which again requires resources in implementation, training,
and maintenance. Such suggested systems involve the monitoring of return rates for spikes. n187 Again, this points to an aspect that
compounds the costs of maintaining a policing function - many online gaming transactions are minimal in amount, causing every
transaction to be suspect. n188 In addition, transaction costs are bound to increase as a result of the added liability of financial
institutions. The authors suggest merchants review policies, extra assurances, and indemnification clauses in contracts. n189 Again,
these tips are reasonable, necessary, and point toward an area of increased costs to both financial institutions and their customers.
Financial institutions will demand better contract drafting to reflect their increased potential liability and require heightened
assurances and documentation of customer businesses to ensure compliance with the UIGEA. As a result, transaction costs will rise
for both the party requiring such assurances and the party responsible for providing proof of them. When you consider the costs
incurred by financial institutions when they must decline a legitimate transaction for fear of it being a restricted one, the costs
multiply even further. The costs to U.S. financial institutions imposed by the UIGEA provides perhaps the best argument against the
UIGEA and points out a fundamental flaw in the UIGEA's structure: the undue burden imposed on the financial transaction
providers. The broader the regulations, the heavier the burden will be on U.S. financial institutions; on the other hand, the narrower
the regulations, the more online casinos will continue to operate with ease. Further, given the heightened costs in several areas,
concern has been expressed for whether smaller community banks will be able to implement the UIGEA's requirements at all. n190
In a regulation and [*544] taxation scheme that could generate nearly $ 7 billion in taxes annually, the system could pay for itself
instead of burdening private entities with the costs. n191 V. Conclusion The
UIGEA was a last-minute attempt by
Congress to regulate an Internet industry that has proven difficult to harness. As a result, the UIGEA's
problems are numerous and fundamental. The UIGEA reflects a stance contrary to that of the majority of the world, creating global
relations problems for the United States. In addition, its enforcement troubles point toward problems inherent in its structure and
mechanisms. Finally, the
burden it places on U.S. financial institutions amounts to an unjust
appropriation of private resources for law enforcement purposes. The confusion for U.S.
financial institutions after its enactment was not relieved with the release of the proposed rules,
but was compounded. As it stands, the
total cost to U.S. financial institutions is beyond estimate, and the
potential results could be devastating. The difficulties involved in drafting the proposed rules point toward
the problems inherent with the mechanisms of the UIGEA. Any broadening results in further unfair burdens on the financial
institutions of the United States, while any narrowing allows Internet gamblers to continue to fund their activities. A taxation and
regulation scheme, in place of the UIGEA, is America's best bet. Not
only will a regulation and taxation scheme
pay for itself, thus relieving the burden on U.S. financial institutions, n192 but it may create [*545]
excess tax revenues, provide ease of enforcement, and will undoubtedly bring the U.S. in line
with the majority of the world's nations.
Dollar hegemony is uniquely necessary to prevent an all-out exchange
between the United States and Russia, ISIS rise, and the collapse of
American leadership
Maund 2014 (Clive P [commodity broker, stock broker, expert in precious metal trade]; Will
the US succeed in break Russia to maintain dollar hegemony; Aug 25;
www.clivemaund.com/article.php?art_id=3278; kdf)
In Why they are making an enemy of Russia? we looked at two of the key reasons why the US is making an enemy of Russia, namely the promotion of
conflict by the powerful Defense industry lobby in order to keep its order books full, and the value of conjuring up an external enemy as a hate figure for
the masses, in order to take the heat off the government. In this article we are going to look at what is arguably an even bigger reason, that was largely
omitted in the earlier article, which is that Russia, in alliance with China,
is threatening to bring an end to the dollar as
the global reserve currency, which would mean the end of the American empire. We are witness
to the greatest struggle of our age – the battle to maintain global dollar hegemony, and with it
US economic, military and political dominance of the entire planet – and this struggle is now
coming to a head. Notwithstanding its undeniably great accomplishments of the past hundred years, the relationship of the
United States to the rest of the world is parasitic. This is because it creates money and debt instruments out of nothing,
requiring virtually no effort, which it then swaps for goods and services with other countries . Because the US dollar is the global
reserve currency, it is able to rack up astronomic deficits that would be untenable for any other
country. US debts are now at such levels that if the US dollar loses its reserve currency status,
the United States economy will implode and it will quickly be reduced to the status of a banana republic – hence
the sense of urgency in the face of growing threats. Any state that moves to opt out of using the dollar as a medium of
exchange is dealt with, forcibly if deemed necessary. The tactics are threefold – economic blockade (sanctions), the
funding of an internal revolution, perhaps assisted by US special forces, and an outright military invasion, or
perhaps a combination of the three. This is what happened in Iraq and Libya, both of which planned to trade their oil in
currencies other than the dollar. Perhaps the greatest irony of all is that the world’s savings, via the Treasury market, are used to fund
the vast US military machine with its hundreds of bases spread across the world which forcibly makes sure they stay yoked to this system. Enter
Russia (and China), the biggest threat yet to dollar dominance. These large powerful neighbors have entered into
various major currency and trade agreements in the recent past that do not involve the dollar, and therefore pose a serious threat to the dollar’s reserve
currency status that left unchallenged would bring it to an end. Once
you understand that you understand the reason
for the recent propaganda blitz against Russia. In addition China has been busy mopping up the
global gold supply for several years, as early preparation for the eventual backing of its currency
by gold, which will put the final nail in the US’ coffin, as the unbacked dollar will collapse completely when this
happens. A sad irony for the American people is that even though the US has the ability to swap unlimited intrinsically worthless paper for goods and
services from the the rest of the world, the infrastructure of the country is crumbling and many Americans already live in poverty on “food stamps”, and
even the great US middle class is being squeezed. This is because the elites don’t care about the country or the masses – all they care about is power and
the amassing of personal fortunes. If you are any good at playing chess you should find it very easy to understand the power game as it now stands. The
US wants to “deal with Russia” which has made substantial moves to operate outside the confines of the dollar based trading system. If it could attack it
militarily and bomb it into submission, as it has done with various smaller states, it would, but because Russia
is a big powerful
country with a sizeable military of its own, and nukes, that is not an option. Efforts to subvert the
Russian government from within and foment revolution probably wouldn’t work, because the Russian
secret services are good at rooting out subversives, and probably as ruthless as the US black ops. That only leaves the option of an
economic blockade – sanctions, in an effort to isolate and mortally weaken the Russia economy,
and as we know, these sanctions are already in place. But what excuse do you use to impose sanctions? - after all, it doesn’t sound too good to go on
BBC World News and say “Russia
has decided to implement trade agreements that don’t involve the US
dollar, so we are going to blockade it economically” - enter the Ukraine. The US searched for a
geographic doorway through which to attack Russia – the North and east routes don’t work because they are either ocean
or China, countries like Poland in Europe wouldn’t do either, because they are firmly in the Western camp now, but the Ukraine was perfect
for the job because of its being a large country on the SW flank of Russia that is torn in two
directions, having old loyalties and blood ties to Russia, and aspirations to a closer union with Europe – the perfect place to foment a proWestern revolution and perhaps a civil war that would draw Russia in and could then be used as an excuse to implement sanctions. That is exactly what
has happened. So
now we have sanctions, but the problem for the US is this – they probably won’t
work. They will cause damage, especially to the fools in Europe who have slavishly followed their orders from Washington to implement them, but
they probably won’t destroy the Russian economy as the US is hoping. This is because the Russian economy is very big and can
if necessary operate on a self-sufficient basis, especially as it has its own oil and gas, and an important
supportive factor is that it has a big powerful neighbor in the form of China which knows it will be “in the firing line” after Russia, and is thus quite
happy to enter into a mutually supportive relationship with Russia. China
and Russia look set to form a “dollar free” axis
and tough it out with Washington. The Chinese have worked all this out in advance, as has Putin, which is why, in addition to
mopping up all the gold available on the market in recent times to later back its currency, it has been beefing up its military in readiness to counter
future threats from the US military, which is already making moves to reopen bases in the Philippines, and engaging in other expansionary measures in
the Mid-East, we have the Islamic State movement, which appears to have
arisen spontaneously to fill the power vacuum that was created when US forces quit Iraq. We should
the west Pacific. Meanwhile, in
not forget that although Iraq has existed for many decades, the country is an artificial creation of the British after the collapse of the Ottoman Empire in
order to control the region and its oil reserves. The US is trying to stop them with air power, but without “boots on the ground” they are unlikely to
succeed. Although Israel
is looking on with satisfaction as Arab kills Arab, it had better hope that the
dollar doesn’t lose its reserve currency status, or they could be in big trouble as the conveyor belt
of money and arms across the Atlantic from the US could grind to a halt. The situation between the US and
Russia (and in the future China) is potentially very dangerous – is already very dangerous. Are they (the US elites and NATO) crazy enough to start a
World War? – World War III? Sure they are and you can see the potential for it in the continual provocation and brinksmanship that is already going
on, a fine example of which being the rabid and almost hysterical reaction to the Russian aid convey that just went across the border into eastern
Ukraine. What they could have said to Russia, if they were reasonable, is “Thank you for going to the trouble and expense of organizing a big relief
convoy for the besieged people of the cities of eastern Ukraine, who have no electricity, food or water.” Instead their reaction was one of sanctimonious
outrage – “How dare you cross the border of this sovereign state without the permission of their government? – This is a grave escalation.” etc and are
using it as an excuse to crank up sanctions even more. The situation in eastern Ukraine and involving the Russian aid convey is a classic example of how
propaganda can be used to turn white into black. The way it worked is this; the humanitarian situation for countless thousands of people holed up in
big cities in eastern Ukraine, like Donetsk and Luhansk, is dire. They have been relentlessly shelled and have little or no electricity, food or water. Many
of these people are either Russian speaking or of Russian descent, so it is natural for Russia to want to go to their aid. So Russia went to the trouble and
expense of organizing a big relief convoy. The controlled Western media have downplayed this crisis which affects countless thousands, hardly
reporting on it at all, but they have had plenty of airtime – much more – for one American reporter gruesomely executed by a British Jihadist. They
have done this because they don’t want people to be aware of the attacks being carried by the Ukraine government against its own people, which they
back, and they don’t want people to understand the reason for the Russian aid convoy, so that they can then misrepresent the reasons for the aid
convoy. The allegations by the Western media that the aid convoy has military objectives is absurd – you don’t need to be a truck driver to know that it’s
very difficult to squeeze a tank or an armored troop carrier into an average sized truck. The protest that Russia is “violating Ukraine’s territorial
integrity” by driving the trucks on through without permission is hypocritical cant and humbug, especially coming from a country that invaded Iraq on
false pretenses, the mythical “weapons of mass destruction”. If Kiev wasn’t massacring its own citizens in eastern Ukraine, the aid convoy wouldn’t be
necessary, and the reason that the trucks pressed on into Ukraine is that they were being deliberately messed about for a week at the border, when
vetting the trucks should have taken 2 days maximum. So there you see a fine example of propaganda by omission, the purpose being to misrepresent
the objectives of the Russian aid convoy, in order to present it as an act of aggression by Russia and therefore as a justification for a further tightening
of sanctions. Let’s go back to first principles for a moment and ask ourselves why the US is so concerned about what happens in the Ukraine, which is a
country on the other side of the world from the US and therefore none of its business, unless that is it fancies itself as the new Roman Empire – perhaps
Barack Obama believes himself to be a latter day Julius Caesar, which conjures up the vision of him entering Congress as if it was the Coliseum, dressed
in a white robe and sandals, with a laurel wreath on his head. The
US does in fact command an empire, and uses the
dollar reserve currency system and its massive military to control its dominions, punishing severely any that try to
break out of it. However, its dominions do not include China and Russia, which cannot be subjugated due
to their big economies and their ability to physically defend themselves with nukes, if need be,
and they are destined to dethrone the dollar and collapse the empire, which is completely rotted out internally,
stricken as it is with massive debts and hopelessly corrupt government, as evidenced by the recent train of deplorable leaders. It is hard to overstate the
stupidity of Europe in toadying to the US and imposing sanctions on Russia (in other words starting a trade war). Russia is not some Third World
banana republic, it is an important world power, and the act of imposing sanctions on it by Europe and the US is a gross insult and extreme provocation
that will have disastrous consequences, particularly since it is now allied with China, with which it will now work assiduously to completely bypass the
dollar. China
knows that if the US succeeds in destroying Russia economically and subjugating it,
then it’s next, so we can expect China and Russia to forge a very powerful alliance. Europe’s
economy is already extremely fragile, and it stands to lose far more over the short to mediumterm than the US by picking a fight it can’t win with its huge neighbor. Europe now faces a plunging currency
and disintegration with the rise of far right political parties leading eventually to tribal wars – European countries have a long tradition of idiotic
destructive attritional wars. Russia will probably get along alright, with its big internal economy and new trade agreements with China. The rabid
propaganda now being bandied about in Western media, especially with respect to Russia, is so crude and primitive that it would have even made the
Nazi propaganda maestro, Dr Goebbels, blush with embarrassment, and you couldn’t accuse him of underestimating the stupidity of the masses. We
haven’t seen this sort of thing since before the 2nd World War. What does it mean? – it means that the Western elites are DESPERATE, desperate in
the face of a looming collapse of the dollar caused by its losing its reserve currency status – so desperate that you can practically see the perspiration
running down their faces. It’s true that the dollar is rallying now temporarily because of the gathering collapse of Europe, and may continue to benefit
from this for a while, and possibly soon from stockmarket liquidation too, but they are looking beyond that. Once the dollar goes their empire is
finished – it will no longer be possible to maintain careening astronomic deficits, there will be no more limitless funds for the military machine many of
whose bases could end up looking like the town of Pripyat near Chernobyl, no more imposing their will by force anywhere in the world, no more
imposing fines on foreign banks and institutions for not doing things their way, no more money and arms for Israel, no more massive bonuses on Wall
St etc. The rapid spread of destitution and poverty amongst the masses in the US means that a state of anarchy could well erupt that sees the mansions
and citadels of the elites ransacked by the mob, and they are well aware of this possibility, which is the reason for the militarization of police forces
across the country, as recently demonstrated in Ferguson, Missouri, and the stockpiling of vast quantities of ammo. The biggest danger arising out of all
this is that desperate people do desperate things, and the recent crude “gloves off” propaganda blitz is certainly a sign of desperation. It’s been a long
time since a really big war and you can see from their increasingly reckless words and actions that they are lusting for it. It is one of the supreme ironies
of this time that amidst all the maudlin sentimentality over the start of the 1st World War exactly 100 years ago, they are bringing us to the brink of
another. Could
it cross the line and go nuclear? – given the reckless aggression and brinksmanship
already being displayed, that is certainly a possibility. They can mass all the arms and missile
batteries along Russia’s western border they like, perhaps promoting the paranoid notion that
Russia wants to take back Eastern Europe, which it doesn’t, but it will never amount to anything more than a costly bluff,
because if they ever dared attack Russia, then European cities would disappear under mushroom clouds. The underlying reason for such operations
would probably be more lucrative contracts for the defense industry. Remember, it wasn’t the elites who got killed in the 1st World War, it was the
hapless young fools who thought they were doing the honorable thing going off to fight for their countries. So you’d better get good at seeing through
the thick smog of propaganda in order that you understand what’s really going on and can take the necessary steps to protect yourself – if you don’t it
could cost you and your loved ones more than just your property and investments, it could cost you your lives. Many people suffer from vague
uncertainties – they know something is wrong, but can’t put their finger on it. This is because they are not privy to “The Grand Plan” and believe the lies
and misinformation carefully and skillfully served up to them by the compliant media, whose masters view the masses as sheep and treat them like
mushrooms – “Feed them shit and keep them in the dark”. But once you become aware of the game plan, it is liberating, and spotting the lies and
misinformation in the media becomes a kind of sport. Knowledge is power, and if you figure out that the dollar is going to collapse after its current rally
– which could have quite a way to go incidentally – then you know to position yourself to escape the catastrophic effects of its eventual collapse and
even profit handsomely from it – that is when gold and silver will do their moonshot of course, and it could coincide with the Chinese backing their
currency with gold. In conclusion, the
answer to the question posed by this article “Will the US succeed in
breaking Russia to maintain dollar hegemony?” is: “No, it won’t”, which means that the dollar is
going to collapse, probably right after its swansong “death of Europe” rally, which is currently in
progress.
Solvency
Online gambling inevitable – timing of regulation is crucial to making uniform
standards
Finger, 2013, ( Richard Finger has a BS in economics from UC Berkeley and an MBA in finance from the U of Pennsylvania
Wharton School. He is a registered investment advisor based in Houston Texas, specializing in equity options. My focus is naked put
selling and spread trading. He has past experience in commercial banking, real estate, and oil and gas, as well as various types of
other derivative investments. , Online Gambling: A Pastime whose time has come, 6/30/2013,
http://www.forbes.com/sites/richardfinger/2013/06/30/online-gambling-a-pastime-whose-time-has-come/)
My opinion is that a
federal law approving internet gambling is ultimately inevitable…….if not this
year, then next or the year after. Republican Congressman Joe Barton of Texas is set to introduce his
own version legislation to legalize online poker. Harry Reid in collaboration fellow Nevada Republican
Senator Dean Heller has plans of their own to push this ball forward. As more and more states
ratify then the pressure intensifies nationally to impose uniformity on what will become an
unwieldy system of overlapping and conflicting statutes. The endgame for all the states is
revenue generation , nothing more, nothing less. No taxing authority ever wants to get left behind. The hypocrisy of
government confining gambling to just the lottery is on its way to ending. The internet is a proven powerful force for
the sheer numbers it is capable of generating. Gambling is a primordial instinct. Why not let people decide where
they spend their money. Let them gamble and buy 64 ounce sugary drinks. The outcome will be interesting.
Only regulation can solve the ills of the online gambling market.
Freeman, 2013 (Geoff, President and CEO of the American Gaming Association, Submitted to the U. S. House Committee
on Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade Hearing entitled: “The State of Online Gaming”
December 10, 2013, http://docs.house.gov/meetings/IF/IF17/20131210/101570/HHRG-113-IF17-Wstate-FreemanG-20131210.pdf)
Opponents of online gaming suggest that expanding this option will open a Pandora’s Box
threatening the young and vulnerable members of our society. I respect this point of view, even as I
respectfully disagree. I believe we can use technology to put effective protections in place for these
individuals. In fact, this is where, as an industry, we are completely aligned, whether or not we
agree on online gaming.Other countries -- including the United Kingdom, France, Italy, and
Canada – are already using technology effectively to protect online gamers, as are three U.S.
states. Contrary to what some opponents of online gaming claim, the sky has not fallen in these
regulated markets. Growth of the Internet into wider and wider areas of our lives always raises fearsof the unknown and
predictions of dire consequences. Just a decade or so ago, millions of people thought it was unsafe to purchase products online. Now,
Cyber Monday has eclipsed Black Friday as the busiest shopping day of the year.3 Responsibly
extending gaming into
the online world is a natural progression for our industry. Millions of Americans are already
gambling online illegally and will continue to do so, no matter how many times we try to
prohibit it. Millions and millions more would like to do so legally and responsibly. Americans will always gamble —
offline, online or in whatever new form will be created tomorrow. And, as countless studies show, 95% will do so
in a responsible manner. The American Gaming Association believes the best protection for
consumers of online games is through strong and effective regulation that respects states’ rights.
We look forward to working with Members of this Subcommittee and other congressional leaders to achieve this goal.
2ac
Ban CP
CP still doesn’t resolve the aff – it’s a safety net to get out of something
– sets a precedent that destroys credibility
Wohl 09
Isaac Wohl, is an International Trade Analyst in the Office of Industries, The Antigua-United States Online Gambling Dispute, June 2009
The WTO’s decision underscores the general point that trade commitments can have unpredictable consequences. International trade agreements
inherently impact national sovereignty inasmuch as signatories agree to choose only policies that do not reduce market access from negotiated levels
(Bagwell and Staiger 2001, 545). This can affect regulatory flexibility in a wide array of behind-the-border policy areas, including import licensing
procedures, customs valuation, sanitary and phytosanitary measures, and labor and environmental standards (Srinivasan 2002, 5). Trade agreements
are incomplete contracts in that they cannot anticipate all future conditions, so industry trends, technological changes, exchange rate shocks, political
realignments, or other contingencies can leave signatories with limited policy options (Mahlstein and Schropp 2007, 1).12 Governments
that make trade commitments freely accept these risks in exchange for anticipated
market access gains and other benefits. However, the tension between national regulatory efforts and international
trade agreements has surfaced repeatedly, in the EU’s ban on U.S. exports of hormone-treated beef (WTO 1997a), the United States’ ban on certain
shrimp imports stemming from its 1973 Endangered Species Act (WTO 1998), and numerous other disputes. Trade in services agreements may involve
unique uncertainties and risks, as developments in services can be especially difficult to predict .
Services are intangible, nonstorable, subject to rapid innovation, and are deliverable not only through crossborder transactions but also through the movement of consumers (consumption abroad), firms (commercial presence), and labor
(temporary movement of people). Additionally, many research agencies are only now developing a robust set of trade-in-services statistics and
analyses. The risks inherent in services trade commitments were emphasized in 1998 by former WTO Director General Renato Ruggiero, who argued
that the GATS extends “into areas never before recognized as trade policy” (Ruggiero 1998). Countries try to anticipate future developments when
making services trade commitments, but even the
United States with its expertise and resources did not predict when it
might one day be interpreted to include online
gambling (a service that did not exist in 1994 when such commitments were scheduled). There are ways to deal with
the risk of unintended consequences. Many trade agreements have provisions
allowing signatories to renegotiate or rebalance commitments, such as GATS
Article XXI, invoked by the United States in the online gambling dispute, which lets countries compensate for the modification or withdrawal
agreed to free trade in recreational services that this
of existing market access commitments by making new ones. Trade agreements can also incorporate emergency safeguard measures: escape clauses
that exempt specific products from liberalization commitments in order to provide temporary relief to domestic industries that are seriously and
unexpectedly harmed. Article XIX of the General Agreement on Tariffs and Trade (GATT) regulates emergency safeguard measures for goods, and
GATS Article X calls for discussions about similar safeguards for services. (Clogstoun, Trewin, and Bosworth 2006)13 Safeguards can provide policy
flexibility and increase domestic political support for liberalization agreements; it is plausible that the promise of eventual services safeguard measures
helped countries make more and deeper services commitments in the Uruguay Round than they would have done otherwise (Sauvé 2002, 314). But
safety valves can impede liberalization and limit the impact of trade agreements, as many of
the benefits of liberalization come from credibly locking in policies and
establishing high barriers to future backpedaling . Even trade commitments that
go no further than confirming on-the-ground levels of liberalization can encourage
investment when investors know that the rules are no longer subject to an- nual
legislative renewal or other political conditions. The Antigua-United States dispute illustrates the balancing act
demanded in international trade agreements: liberalization requires that countries be discouraged
from unilaterally
altering or
withdrawing from commitments just because unpopular
consequences arise , but countries are less likely to make commitments in the first place if it is
CP is a “zero quota” on gambling – that violates trade commitments
Grunfeld 07 (Michael Grunfeld is an associate in the Litigation Group of the New York
office of Shearman & Sterling LLP, JD from Columbia, Columbia Business Law Review, 2007,
“DON'T BET ON THE UNITED STATES'S INTERNET GAMBLING LAWS: THE TENSION
BETWEEN INTERNET GAMBLING LEGISLATION AND WORLD TRADE ORGANIZATION
COMMITMENTS”, 439)
It might be true that barring states, even at the purely intrastate level, from authorizing an
activity that has traditionally been a matter of state control goes against the United States's
federalist tradition in that area. However, allowing such authorization might also contradict
some of the United States's more recent, but not necessarily any less important, free trade
commitments in the WTO. After all, the very same statute that explains that gambling is
traditionally an area of state control goes on to explain that "the Federal Government . . . should
act to protect identifiable national interests.""'° If the United States enters into free trade
agreements by which it guarantees equal treatment with regard to certain sectors of the
economy, then it makes sense that the federal government cannot prohibit access to other WTO
members while allowing states to limit access to U.S. citizens at the intrastate level. Such an
arrangement blatantly accords unequal treatment. This is not to say that either concern-states'
rights versus free trade-is necessarily more important. The aim here is to show how these two
values come into conflict, but not to address the policy question of how to resolve that conflict.
Such a resolution depends on how one balances the two competing values relative to one
another.
It is also not surprising that federalism concerns and free trade commitments would come into
conflict here because there is an inherent tension between these values. International free trade
commitments, and treaty commitments more broadly, are made between nations as a whole.
The nature of these agreements is for the signatories to make certain commitments on behalf of
their whole country. On the other hand, the very nature of federalism is to leave certain areas of
control up to individual states to decide for themselves. Therefore, on any given issue, by signing
a treaty on behalf of the whole country, the federal government is necessarily taking that issue
out of the control of individual states. There are some areas that individual states have a
constitutional right to control and thus there would be a constitutional problem with the federal
government signing a treaty on behalf of all the states in such an area. The regulation of Internet
gambling, however, is not such an area. As explained earlier, even though gambling regulation is
traditionally a matter of state control, the federal government has the constitutional authority to
regulate most gambling activities, and will do so when it sees a need for federal legislation.'
Therefore, the issue here is a policy matter of whether the federal government would prefer to
leave the issue up to individual states to decide for themselves, or would rather make a decision
on behalf of the entire nation as part of its GATS commitments.
Understanding the United States's underlying concern as one of federalism gives a much more
satisfying explanation for the conflict than do the protectionist or paternalist arguments. This
way, in the laws that conflict with the United States's GATS commitments, the United States can
be seen as taking a default position against gambling, while at the same time-out of concern for
states' rights-states can choose to exempt themselves on a limited basis. This ultimately leads to
treating foreign suppliers under the default of illegality, but leaving room for states to make the
conduct legal on an internal basis, yielding the problematic discrimination between how the
conduct is treated within individual states and how it is treated on the international level.
The basic explanation of the WTO rule against discriminatory laws given up until this point has
been sufficient for understanding the basic issues applicable to U.S. laws in this area. However,
in order to fully understand precisely what the problem is in the current dispute and to ascertain
whether or not there might be similar problems with other laws that were not considered by the
WTO, a more detailed analysis of the WTO's standards on this matter is necessary.
IV. THE WTO DISPUTE
Since the legal status of Internet gambling is so unclear in the United States, the businesses are
often based offshore. The small island nation of Antigua-Barbuda (Antigua) has become a hub
for online casinos.'32 Many of these casinos have established reputations for honest dealing and
are accepted as running their operations in good faith. Antigua welcomes this business and it is
an important part of the small country's economy. Despite the general accessibility of these
foreign-based sites to U.S. citizens in recent years, as specific actions, threatened the free
exchange of business between its local gambling sites and U.S. citizens.133
In June of 2003, Antigua filed a complaint with the WTO, claiming that certain U.S. federal and
state laws violated the United States's free trade commitments entered into under the GATS."'
Antigua argued that "various U.S. actions against offshore online gambling amounted to 'an illegal
barrier to trade in services."'13 , In its Request for Consultation before the WTO, Antigua listed a
plethora of federal and state statutes, as well as a number of individual federal and state actions,
that it claimed infringe on the free trade of Internet gambling services guaranteed by the United
States under the GATS.136 In addition, Antigua claimed that the totality of the U.S. laws
amounted to a "total ban" on the cross-border supply of Internet gambling.3 7
The analysis in U.S. - Gambling involved several complex steps. Simply stating the conclusions
would ignore key facets of the dispute, which are important to understand if one is to fully
comprehend the standards being applied to U.S. law. Therefore, in order to glean an
understanding of the legal standards by which disputes in this area are judged, this note will
give a more detailed explanation of the WTO's reasoning.
The WTO's analysis focused on determining the nature of the United States's- free trade
commitments under Article XVI of the GATS, applying those commitments to the measures at
issue, and then considering the United States's defense under the "public morals" exception of
the free trade agreement.13 The case was first presided over by the WTO's Dispute Panel (DP).
Each side then appealed several issues from the DP's decision to the Appellate Body (AB), which
judged each of these issues on appeal, overruling significant parts of the DP's decision.
A. The United States's Commitment to Gambling Services
The AB upheld (though on different grounds) the DP's conclusion that "the United States's
Schedule under the GATS includes specific commitments on gambling and betting services."139
The AB also agreed with the DP's conclusion that the substance of the United States's
commitment in this area is "to provide full market access, within the meaning of Article XVI."'
4° The AB then affirmed the DP's ruling that limitations tantamount to a "zero quota" (in that
they totally prevent market access) are covered by Article XVI:2's provisions prohibiting
"limitations on the number of service suppliers [and] service operations or on the total quantity
of service output."''
When a country agrees to grant market access to any sector of the economy, it is agreeing for the
entire sector, and therefore is in violation of its commitments "if it does not allow market access
to the whole or part of a scheduled sector or sub-sector."142 Similarly, the types of
commitments at issue here (mode 1) "allow services suppliers in other WTO Members for a
committed sector to supply services cross-border via any means of delivery."' Based on the all
encompassing nature of these commitments, totally limiting even one means of delivery of even
part of a scheduled sector or sub-sector will constitute a "zero quota" with respect to that means
of delivery in that part of the scheduled sector or sub-sector. Therefore, even though gambling
might be just part of a scheduled sector, and some U.S. laws may only limit certain means of
delivering that service, even those laws will be problematic if the United States has made a
market access commitment of the type that guarantees all modes of delivery. Essentially, under
the GATS, the United States agreed to provide "market access" to all means of delivery of
gambling services. The WTO therefore was not looking only at restrictions on Internet gambling,
but rather at any restrictions on the free trade of gambling services with Antigua.
Because the United States's commitment is to have zero restrictions on the access to this service,
it does not matter to what extent the restrictions are limited to Internet gambling, as opposed to
all gambling services. However, later on in the analysis, the distinction between Internet and live
gambling will become relevant when determining whether or not the United States applies its
restrictions in a discriminatory manner
Add-On – Prediction Markets
Plan legalizes prediction markets – CFTC will not preempt regulatory
betting.
Econsult 2014
Econsult Solutions, economic policy consulting firm, THE CURRENT CONDITION AND
FUTURE VIABILITY OF CASINO GAMING IN PENNSYLVANIA, Report Submitted to The
Pennsylvania Legislative Budget and Finance Committee, May 2014
http://www.econsultsolutions.com/wp-content/uploads/PA-Gaming-Report-from-ESI_May6.pdf
Another potential source that is related to the gaming industry is prediction markets. These markets
allow individuals to purchase what are known as “binary options”, but are more easily understood as “a bet that pays off if some
future event comes true.” The
most well-known example of a prediction market is Intrade, whose
presidential election prediction markets were a popular part of mainstream election coverage in
past U.S. elections. On these markets, contracts are bought and sold that specify the following: a payout amount, an event
that will or will not come true, and an expiration date. One example would be a contract that paid out $10 if Barack Obama were to
win the U.S. Presidential election in 2012, and nothing had he lost. Prediction markets have for the most part existed in a grey
regulatory area for most of their existence. Their
primary regulator has been the Commodity and Futures Trading
Commission (CFTC), whose lawsuit against Intrade led to it being shut down. However, a recent CFTC
decision to not allow the company NADEX to operate a prediction market for political events
has opened the door to these markets
to operate under state laws. In particular, the statement alleges “The Commission FINDS that the
Political Event Contracts involve gaming as contemplated by CEA Section 5c(c)(5)(C)(i)(V) and Commission
Regulation 40.11(a)(1)”. Some experts interviewed for this study believe that this could potentially
open the door to states allowing prediction markets to operate as regulated by state gaming
agencies. One limitation to this is that the 2010 Dodd-Frank financial reform bill specifically outlawed presidential prediction
markets. However, there is a significant potential market for political events outside of presidential
elections. A specific example discussed by experts is the possibility of trading contracts that pay
off if a particular regulation passes. This type of contract could be of interest to both individual betters and to firms
wishing to hedge against the risk of potentially costly regulations. For example, a car company that would suffer a large decrease in
demand from national carbon tax legislation or regulation could purchase a prediction market contract that paid off if these
regulations do pass. This way the risk would be hedged by ensuring that they receive a payout in the event that costly regulation
passes.
Prediction markets key to manage accelerating technical change –
solves WMD use.
McGinnis 2012
John O., Northwestern Law Professor, Accelerating Democracy: Transforming Governance
Through Technology, pg 2-5
Yet the
central political problem of our time is how to adapt our ven- erable democracy to the
acceleration of the information age. Modern technology creates a supply of new tools for improved governance, but it
also creates an urgent demand for putting these tools to use. The need bet- ter policies to obtain the benefits of
innovation as quickly as possible and to manage the social problems that speedier innovation
will inevitably create—from pollution to weapons of mass destruction. Exponential growth in computation
is driving today's social change. The key advantage for politics is that increases in computational power dramatically improve
information technology. Thus, unlike most techno- logical innovations of the past, many
innovations today directly
supply new mechanisms for evaluating the consequences of social policies. Our task is to place politics
progressively within the domain of information technology—to use its new or enhanced tools, such as empiricism, infor- mation
markets, dispersed media, and artificial intelligence, to reinvent governance. For instance, the
Internet greatly facilitates
betting pools called infor- mation or prediction markets that permit people to bet on the
occurrence of future events. Such markets already gauge election results more accu- rately than polls do. If legalized
and modestly subsidized, they could also foretell many policy results better than politicians
or experts alone. We could then better predict the consequences of changes in educational pol- icy
short, prediction markets would provide a
visible hand to help guide policy choices. The Internet today also encourages dispersed media like blogs to in- tensify
on educational outcomes or a stimulus program on economic growth. In
confrontations about contending policy claims. Previously a less diverse mainstream media tended to settle for received wisdom.
Our more competitive media culture permits the rapid recombination of innovative policy proposals and expert analysis no less than
our more competitive scientific culture provides an incubator for new computer applications. A novel plan for reducing
unemployment is immediately analyzed, cri- tiqued, and compared to other programs. Because of this greater computational
capacity, society
can also use more effective methods of social science to evaluate empirically the
re- sults of policies. Like prediction markets and dispersed media, the turn to empiricism benefits from competitive
structures. Different jurisdictions, from states to school districts, try to gain advantages over one another by adopting better policies.
With our more sophisticated empirical tools, we can then assess the effect of their distinctive
policies, gauging the degree to which gun control helps prevent crime or whether longer school hours improve student learning.
Thus, the technological transformation of society contains within it- self the dynamo of its own
management, but only if we create laws and regulations to permit the infonnation revolution to
wash through our democratic structures. For instance. Congress must legalize online pre- diction
markets and systematically encourage policy experimentation within the framework of its
legislation. The Supreme Court must assure that the changing media can deliver information to citizens, particularly at election
time. We cannot tolerate social learning that moves at gla- cial speed when technological change gallops apace; we cannot put up
with a government that inaccurately assesses policy results with outdated methods when new smarter mechanisms are within its
reach. The techno- logical revolution is giving us progressively better hardware to gather the information in the world to improve
policy outcomes. But government structures and rules provide the essential social software to make that hardware work effectively
on behalf of society. With
the advent of new technology, the ideal structure for social gov- ernance
today starkly contrasts with previous visions of modern govern- ment, like that celebrated in the New
Deal, which relied on centralized planning. There the focus was also on improved governance
through the use of social information, but the analysis was to be handed down from the top —from
experts and bureaucrats. Today technology permits knowledge to bubble up from more dispersed sources
that are filtered through more competitive mechanisms, sustaining a more decentralized and
accurate system of social discovery. We can acquire general expertise without being beholden to
particular experts. The nation can retain and improve the best of the model of governance we
have—a politics that seeks to be informed by expertise and social-scientific knowledge—while
shedding the error-prone arrogance and insularity of a technocracy. The promise of modem
information technology for improving social governance should not be confused with an enthusiasm for using technol- ogy amply to
Increase democratic participation. Often labeled "digital de- mocracy," this perspective animates President Barack Obama's promise
to respond to Web-based petitions that collect five thousand signatures.' But more equal participation is not sufficient to assess more
accurately the con- sequences of social policy, because citizens do not possess equal knowledge. Modem information technology
instead allows us to root improved governance in a realistic assessment of human nature. It permits competi- tive mechanisms and
the scientific method to harness man's self-interest and unequally distributed knowledge for the public good. More
Utopian
visions of social reform, which rely solely either on the opinions of an elite or the unrefined
sentiment of the people to remake society, are worse than political blunders. They are
anachronisms in the information age, with its more accurate methods for sifting information
and translating it into the knowledge needed to evaluate policy. The use of market mechanisms and the
scientific method also could lower the political temperature. Such tools encourage a greater recog- nition of the
uncertain effects of all human action and thereby bring a greater dispassion to the business of
social reform. This style of politics makes it more likely that society will act on the best
evidence available to make steady improvements and avoid the worst catastrophes.
Contemporary technology not only supplies tools for better decision making but also creates a demand for their deployment to both
speed the benefits of innovation and handle its dangers. Technological inno- vations today hold the potential to provide a great boon
to humanity. Advances in biotechnology and other fields promise longer life through medical innovation, and those in computation
generate greater wealth through enhanced productivity. But the pace of these beneficial inven- tions depends in part on government
decisions about taxes, government investments in basic science, and laws on intellectual property. Govern- ment can create a
virtuous circle by using technology to sustain social processes that in turn create a faster cycle of valuable technologies. In contrast,
bad government policy on innovation is today more costly than ever, because it can squander unparalleled opportunities for technological advance. Even more important, better
government is needed to address the downsides of faster
and likely accelerating technological change. Energy- intensive machines began the process of injecting greenhouse
gases into the atmosphere at the time of industrialization. Yet almost no one rec- ognized this development until relatively recently,
in large part because we did not have the necessary predictive tools. Thus our
prior failure to foretell global warming
signals the need for earlier and more accurate assessment of the possibly dangerous by-products
of more advanced and more rapidly developing technology. Domestically, fast-moving technology can be
socially disruptive. Im- proving machine intelligence can at times complement the value of an employee, enhancing his or her
productivity. But it can also at times pro- vide a complete substitute for human labor. As computer search capa- bilities become
more effective, the human premium on simply knowing things falls, as most recently demonstrated by the victory of the computer
Watson over the best players in the history of Jeopardy!—the preeminent television quiz show. Such computer programs will
perform a greater range of clerical tasks, displacing routine white-collar jobs. The result is likely to be more unemployment in the
short tenn and perhaps greater inequality—a recipe for social instability. Economists are right to remind us that workers who are
displaced by machine intelli- gence need not be condemned to long-term idleness. Given the infinite variety of human desires, there
is always more work to be done. But society will need to facilitate social structures that help employees face a lifetime of job changes.
Abroad, technological change will create even more disruption as the wave of acceleration engulfs
societies that have not yet come to terms with the social demands of industrialization, let alone more recent technological change.
Mass disorientation can become the source of both narional aggression and non-state
terrorism—aggression and terrorism made all the more devastating by access to weapons that
are not only increasingly powerful but also [and] deployable by ever smaller groups. Even if
almost all nations in the world democratize, the one remaining rogue nation may exploit
technology to cause mass destruction. Even if most terrorist organizations subside, the few that
are left may gain even more power in asymmetric warfare through access to new destructive
devices. Because of such dangers, the dynamic of modem technology could as easily lead to a
nightfall of civilization as to the dawn of a far better world.- The quality of our politics may make
the difference between nightfall and dawn as we decide how to grapple with our fast-moving
technological advances. Those decisions include when to regulate tech- nologies that may prove dangerous and how to
unleash from obsoles- cent regulation technologies that may prove beneficial. It also includes more general policy improvements to
increase economic growth and so- cial stability so that we can provide the resources and rally the popular support to address the
disruptions that successive waves of technological change will cause. The evolutionary history of mankind highlights the challenge of
ad- justing social governance to faster and faster change. Slowly animals evolved to leam from their environment. Through writing.
Homo sapiens then became the first species to preserve learning, enabling knowledge to grow, ultimately at an exponential pace.
Collective learning over time then became the source of technological improvement, a process that could move much faster than
evolution.
Unpredictable tech innovations are an existential risk.
Bostrom 2013
Nick, Professor, Faculty of Philosophy & Oxford Martin School Director, Future of Humanity
Institute Director, Programme on the Impacts of Future Technology, Existential Risk Prevention
as Global
Priority, Global Policy Volume 4 . Issue 1 . February 2013 http://www.existentialrisk.org/concept.pdf
An existential risk is one that threatens the premature extinction of Earth-originating intelligent life or the
perma- nent and drastic destruction of its potential for desirable future development (Bostrom, 2002). Although it is often
difficult to assess the probability of existential risks, there are many reasons to suppose that the
total such risk confronting humanity over the next few centuries is significant. Estimates of 10-20
per cent total existential risk in this century are fairly typical among those who have examined
the issue, though inevitably such estimates rely heavily on subjective judgment.1 The most reasonable estimate might be
substantially higher or lower. But perhaps the strongest reason for judging the total existential risk within the next few centuries to
be significant is the extreme magnitude of the values at stake. Even
a small probability of existential catastrophe
could be highly practically significant (Bostrom, 2003; Matheny, 2007; Posner. 2004; Weitzman, 2009).
Humanity has survived what we might call natural existential risks for hundreds of thousands of
years; thus it is prima facie unlikely that any of them will do us in within the next hundred.2 This
conclusion is buttressed when we analyse specific risks from nature, such as asteroid impacts, supervolcanic eruptions, earthquakes,
gamma-ray bursts, and so forth: Empirical impact distributions and scientific models suggest that the likelihood of extinction
because of these kinds of risk is extremely small on a time scale of a century or so.3 In contrast, our
species is introducing
entirely new kinds of existential risk—threats we have no track record of surviving. Our
longevity as a species therefore offers no strong prior grounds for confident optimism.
Consideration of specific existential-risk scenarios bears out the suspicion that the great bulk of
existential risk in the foreseeable future consists of anthropogenic existential risks —that is, those
arising from human activity. In particular, most of the biggest existential risks seem to be linked to
potential future technological breakthroughs that may radically expand our ability to
manipulate the external world or our own biology. As our powers expand, so will the scale of their
potential consequences—intended and unintended, positive and negative. For example, there
appear to be significant existential risks in some of the advanced forms of
biotechnology, molecular nanotechnology, and machine intelligence
that might be developed in the decades ahead. The
bulk of existential risk over the next century may thus
reside in rather speculative scenarios to which we cannot assign precise probabilities through any
rigorous statistical or scientific method. But the fact that the probability of some risk is difficult to quantify
does not imply that the risk is negligible. Probability can be understood in different senses. Most relevant here is the
epistemic sense in which probability is construed as (something like) the credence that an ideally reasonable observer should assign
to the risk's mate- rialising based on currently available evidence.4 If
something cannot presently be known to be
objectively safe, it is risky at least in the subjective sense relevant to decision making. An empty cave
is unsafe in just this sense if you cannot tell whether or not it is home to a hungry lion. It would be rational for you to avoid the cave
if you reasonably judge that the expected harm of entry outweighs the expected benefit. The uncertainty and error-proneness of our
first-order assessments of risk is itself something we must factor into our all-things-considered probability assignments. This
factor often dominates in low-probability, high- consequence risks—especially those involving
poorly understood natural phenomena, complex social dynamics, or new technology, or that are difficult to assess for other
reasons. Suppose that some scientific analysis A indicates that some catastrophe X has an extremely small probability P{X) of
occurring. Then the probability that A has some hidden crucial flaw may easily be much greater than P(X).S Furthermore, the
conditional probability of X given that A is crucially flawed, P[X \—>A)l may be fairly high. We may then find that most of the risk of
X resides in the uncer- tainty of our scientific assessment that P(X) was small (Figure 1) (Ord, Hillerbrand and Sandberg, 2010).
FISM
Any federal policy on online gaming guts federalism
Flynn 2014 (Mike; Federalism doesn't stop at the online poker table; Feb 25;
www.breitbart.com/Big-Government/2014/02/25/Federalism-Doesnt-Stop-at-the-OnlinePoker-Table; kdf)
The trouble with being an actor is that you have to remember your lines. The trouble with being a political actor is that that you have
to make the new lines fit with all the other lines you’ve delivered in the past. Senator Dean Heller (R-NV) is running into this very
problem on the issue of Internet gaming. Mr. Heller’s record in the House and the Senate has tracked largely conservative. He voted
against the bailouts of Wall Street and the auto industry. He opposed ObamaCare, saying that those who voted for it “stood up for
political buyoffs and special deals that benefit a small few...” In a recent interview, Senator Heller stated his opposition to President
Obama’s proposal to raise the federal minimum wage. He argued that it should be left up to the states saying, “I think its wrong
when the city of New York has the same minimum wage as Elko does or for that matter Los Angeles or somewhere else.” Yet it seems
the good Senator’s support for federalism stops there. Calling it the “wild wild west” of gambling,
Heller is promising to introduce legislation to trump states that have legalized online gaming with
a federal prohibition. It seems that state laboratories for democracy are good only until they begin to affect the home town industry.
Heller half heartedly points to potential undefined “social ills” but then confesses that “I think the devastation for bricks and mortar
(casinos) in this state...would be just a final nail...” Senator Heller’s position and rhetoric mirrors that of the largest donor to his
election to the Senate who also happens to be the largest opponent of Internet gambling. Sheldon Adelson is reported to have spent
upwards of $7 million on the race between Heller and his opponent Shelly Berkley. Mr. Adelson is also funding a coalition aimed at
passing a federal prohibition on online gaming. The Coalition to Stop Internet Gambling has launched a fear based campaign
featuring such over the top slogans as “click your mouse, lose your house.” Yet, like Senator Heller, the coalition provides little
substantiation for their wild claims. The reality is that what Senator Heller and the most vocal opponents of internet gaming fear the
most is competition. It is easy to see why. Morgan
Stanley reports that in a few years, online gaming will
produce the same amount of revenue as all of the casinos in Las Vegas combined. Such projections call
for innovation and adaptation, not government intervention; a fact that is not lost on a majority of Las Vegas casinos. Ironically,
the two owners that have publicly invested the most in supporting free market policies and
politicians are the lone voices seeking government intervention. The rest of the industry seems to be
salivating at the prospect of free market evolutions in gaming. There is little difference between the type of
legislation being touted by Senator Heller and the legislation he himself labeled special deals
that benefit a few. The Coalition’s position is the moral equivalent to the bookstores of old lobbying Congress to ban Amazon.
Any legislation that would trump states’ rights is an affront to federalism and should be anathema to any
conservative. Worse, any legislation that would outlaw otherwise legal behavior to benefit so few people is pure cronyism.
Marijuana pounds
Schwartz, 13 (Law Prof-Wisconsin, “High Federalism: Marijuana Legalization and the
Limits of Federal Power to Regulate States” 35 Cardozo L. Rev. 567, Lexis)
Marijuana legalization by the states presents the most pressing and complex federalism
issue of our time. Congress has undisputed power to regulate individuals within a state, even
if it creates rights or duties contrary to that state's laws. The power of Congress under the
Commerce Clause to prohibit the manufacture, distribution, and even simple possession of
marijuana, whether or not the offending conduct crosses state lines, is clearly established. n1 In
the Controlled Substances Act (CSA) n2, Congress exercised that regulatory power directly on
the people of the states. But since 1996, several states have legalized medical or even
"recreational" marijuana. The obligation of those states' legislatures, executive officials, and
courts to cooperate with the federal marijuana prohibition is extremely unclear. Internal
state governmental processes have been thrown into confusion by apparent conflicts between
their state's legalization laws and the CSA. State governors have refused to implement duly
enacted state laws for fear that their subordinates will be prosecuted by federal authorities. n3
County bureaucrats are suing their states for injunctions to block enforcement of state laws that
they deem to conflict with federal policy. n4 State courts are uncertain whether to revoke state
law probationers or parolees for [*570] engaging in conduct that is affirmatively legal under
state law. n5 Local police officers are concerned that they may be committing federal crimes by
returning seized property to individuals who have committed no state law offense - and wonder
whether they are obligated by federal law to make arrests for conduct expressly legalized by their
state. n6 Rarely in our history have the obligations of officials of all branches of state
government to conform to federal law been more uncertain - and rarely has federal law so
sweepingly intruded
into state policy choices. is not an exaggeration to say that state marijuana legalization
presents a federalism crisis. n7¶ Current federalism doctrine offers three possible
resolutions to this crisis, all of them unsatisfactory. To see this, we can boil the marijuana
federalism problem down to a single question. Suppose a state or local police officer encounters
a person who is in possession of marijuana in conformance with the state's legalization law.
Must the officer arrest the person and seize the marijuana, or let the person go and keep the
marijuana? This question is the most fundamental and commonplace of all the scenarios
presenting conflicting duties of state officials in the marijuana federalism crisis. Any doctrinal
solution that cannot answer this basic "arrest and seizure" question in a satisfactory manner one that is consistent both internally and with the broader fabric of federalism doctrines necessarily fails to resolve the crisis.
No internal link – cp alone cant break down
Bulman-Pozen 2014 (Jessica, “From Sovereignty and Process to Administration and
Politics: The Afterlife of American Federalism,” 123 Yale L.J. 1920)
Federalism scholarship in the latter half of the twentieth century and the beginning of the twenty-first has largely
resisted the easy narrative of federal aggrandizement at the expense of the states. Acknowledging
that the federal government has assumed regulatory authority over ever more domains , the
literature has argued that this signifies not federalism's demise but rather a change in the
mechanisms that safeguard the place of states in our system
A variety of process federalisms have recast forces traditionally envisioned as threats to a robust
federalism as its guardians: Congress and the President, the Democratic and Republican parties,
and the administrative state have each, in turn, been given a new role. But even as these recastings shed
dual federalism's insistence on judicial review and clearly delineated spheres of state and federal authority, they retain its
core commitment to state autonomy and distinctive interests. Novel forms of state-federal
integration are thus treated as means of preserving state-federal separation: the integration of state
and federal actors safeguards the separation of state and federal action.
AT: GOP Good
Obama’s economic strategy will be successful
Williams, 9/29/14
Economy could tip election to
--- author and political analyst for Fox News Channel (Juan, “Juan Williams:
Dems,” http://thehill.com/opinion/juan-williams/219140-juan-williams-economy-could-tip-election-to-dems, JMP) One of the biggest surprises on the
midterm campaign trail is hearing President Obama echo President Reagan’s famous question by asking
voters whether “you are better off than you were four years ago.” The question is the hammer
in Obama’s toolbox for nailing down his Democratic majority in the Senate in this year’s
midterm election. “By almost every economic measure, we are better off today
than we were when I took office,” the president said in a Sept. 19 speech to the Women’s Leadership Forum, sponsored by the Democratic National
Committee. Speaking to a Labor Day rally of union workers in Milwaukee, he also pointed to America’s improved economic performance over the last five years. “You wouldn’t know it from watching the news,” he
Reuters recently confirmed the president’s upbeat claims. The news agency reported that, however slow, the
economic recovery has lasted longer than average. The report adds, “There seems to be more gas in the tank. The International Monetary Fund expects
lamented. In fact,
the U.S. economy to grow 3 percent next year and in 2016. On Obama’s watch, 5.1 million jobs have also been added to payrolls, the S&P/Case-Shiller national home price index is up about 17 percent and the S&P
There are more hard facts to bolster the president’s economic
case. A Kiplinger’s economic outlook from this month is full of good news. The economy “looks
better than was previously thought,” Kiplinger reports, “setting the stage for more sustained growth in
coming months.” The unemployment rate has been lower over the last five months than at any point in the last five years, dropping to 6.1 percent in August. The Dow Jones industrial average
500 stock index has more than doubled while hitting all-time records.”
is hovering around its all-time high, now regularly closing at over 17,000 points. Consumer confidence in August also rose to its highest point in almost seven years. This, in turn, is key to consumer spending,
which is the biggest part of the economy. Is all the good economic news helping Democrats with the voters? Not really – or, at least, not yet. RealClearPolitics has 55 percent of Americans disapproving of the
president’s handling of the economy, to only 40 percent approving.
Democrats must get voters to turn that negative economic view
around. This month, a CBS/New York Times poll indicated that the economy is the No. 1 issue to voters. A September Gallup poll similarly found that, other than “dissatisfaction with government,” the
top concern is “the economy in general.” With all the good statistics, why does America’s kitchen-table assessment of the economy remain glum? Perhaps because median household incomes fell by more than
Democrats running for Congress are
reminding voters of the GOP’s lack of interest in boosting wages for working people. The GOP
has turned back efforts to raise the minimum wage and to invest in infrastructure. Democrats
also point to the House GOP’s denial of extended unemployment benefits for the long-term
jobless. Republicans, meanwhile, are promising that, if they take total control of Congress, they will boost the economy by cutting Wall Street regulation. They also plan to fight new rules from the
$2,100 in Obama’s first term, according to the Census Bureau. Sagging wages have created lingering discomfort and anxiety.
Environmental Protection Agency and support oil and gas exploration. Speaker John Boehner (R-Ohio) handed ammunition to the Democrats this month when he said some Americans have “this idea” that,
instead of finding a job, “I think I’d rather just sit around.” Before Congress left for the campaign trail, the party race to win voters, stressed out over low pay, turned into an unusual fight over the Export-Import
Bank. The bank was reauthorized for only nine months. But first, small-government Republicans — with the Club for Growth and Heritage Action support — pushed to kill the bank, blasting it as an example of
“crony capitalism” and the big government “picking winners and losers.” That divided the GOP because the GOP-leaning Chamber of Commerce is supporting the bank. It points to “thousands of businesses” that
risk failure without the bank. The New York Times reports that the bank is a key issue, a “wild card” in North Carolina, Iowa and Louisiana Senate races. “Our candidates have been leaning heavily into this and
Obama is on to something.
If the midterms turn into a referendum on which party to trust to boost middleclass wages, look for Democrats to hold the Senate.
this really goes to the heart of making the economy work,” a Democratic Senatorial Campaign Committee spokesman told the Times. President
The plan breaks Harry Reid’s de facto deal with Sheldon Adelson to
not influence Senate elections
PNR, 9/25/14 (Poker News Report, “November Threat to Online Poker in the United
States,” http://www.pokernewsreport.com/november-threat-to-online-poker-in-the-unitedstates-17239, JMP)
The possibility that the “Restoration of America´s Wire Act” could be passed during November
poses a genuine threat to online poker in the United States.
Back in March, South Carolina Senator Lindsey Graham and Utah Representative Jason Chaffetz introduced a bill into Congress
entitled the “Restoration of Americas Wire Act” (RAWA). The
bill was backed by anti-online gambling
campaigner Sheldon Adelson and his Coalition to Stop Internet Gambling
The bill was read in both houses of Congress before being passed to the Committee on the Judiciary – where it would normally stay
until time ran out for the bill to be considered. However, a
massive effort by supporters of Sheldon
Adelson to have the bill debated in Congress during the forthcoming "lame duck" legislative
session (November 9-26) could see RAWA being passed into law.
The Implication´s of RAWA´s Passage
The aim of the bill is to "restore [the] long-standing United States policy that the Wire Act prohibits all forms of Internet gambling".
If passed, the bill would apply to online casinos and online State lotteries as well as online poker, with the only exceptions being
online pari-mutuel betting on horse racing (exempted by the Interstate Horseracing Act 1978) and fantasy sports betting (exempted
by UIGEA).
Under the current wording of the proposed legislation, online poker in the three regulated markets of Nevada, New Jersey and
Delaware would have to cease, and all attempts to bring online poker to California, Pennsylvania and other states would be pointless.
Effectively, if RAWA passes Congress during the forthcoming session, it would put an end to legalised online poker in the United
States.
Why Push RAWA Now?
The timing of the move to get RAWA passed is not accidental. The "lame duck" legislative session is one where outgoing
Congressmen and Congresswomen defer major legislation to the succeeding Congress and deal with relatively minor
matters – often free of any party direction. Many of them will owe a debt of thanks to Sheldon Adelson
for his financial support during their election campaigns
and will feel it can be repaid by supporting the proposed Graham/Chaffetz legislation.
Earlier this year, politico.com reported that Sheldon Adelson had agreed to stay out of the
2014 Senate race in return for Senate Majority Leader Harry Reid giving RAWA a clear
passage, and co-chair of the Coalition to Stop Internet Gambling – Wellington Webb (a former mayor of Denver) – has recently
been using his political influence to spread fears that online poker in the United States is harmful to minorities and that it will
deprive communities of jobs.
As lame duck sessions only come around once every two years, Adelson
and his supporters will see this as the last
opportunity to get anti-online gambling legislation passed before the regulation of online poker
in California – which could then act as a game changer for other states considering online poker, and for those who are elected
to represent them!
Adelson can swing the election by donating millions to GOP
candidates -- he hates online gambling but hasn’t fully opened the
donation floodgates
Stone, 9/3/14 (Peter, “Casino Tycoon Sheldon Adelson Takes $100 Million Gamble on GOP
Senate; Billionaire Sheldon Adelson could put $100 million of his own cash in this year’s
midterms. Can he buy the Senate of his dreams?”
http://www.thedailybeast.com/articles/2014/09/03/casino-tycoon-sheldon-adelson-takes-100million-gamble-on-gop-senate.html)
Billionaire casino magnate Sheldon Adelson
is poised to donate close to $100 million this election cycle,
massive amount that could help
decide which party controls the Senate next year.
with much of that total coming in untraceable “dark money” to conservative groups—a
Several of the casino mogul’s largest checks, in the mid-seven to low-eight figure range, are being sent to a quartet of conservative
nonprofits that under IRS rules can mask donors’ names, say three GOP operatives and donors familiar with his contributions.
Adelson is focused heavily on helping the GOP capture the Senate, and by writing mega checks to
politically active nonprofits, he can stay under the radar while still lavishing tens of millions of dollars groups that help
Republicans get elected.
According to GOP sources, the most prominent dark-money outfits that have received—or are expecting—Adelson’s biggest checks
are Americans for Prosperity, which was founded by the billionaire brothers Charles and David Koch; Crossroads GPS, which was
cofounded by strategist and informal Adelson advisor Karl Rove; the conservative pro-Israel Republican Jewish Coalition; and the
U.S. Chamber of Commerce.
These dark-money entities collectively snared tens of millions in 2012 from Adelson, and all have made courting
the sometimes mercurial 81-year-old tycoon a top priority, including by making visits to his Las Vegas Sands casino hotels
this year. In 2014, these outfits have made winning the Senate their top priority, and are in the midst
of spending tens of millions on ads in battleground states such as Arkansas, Colorado, Iowa, and
North Carolina to help GOP candidates.
Boasting a net worth that was recently pegged by Forbes at $31.6 billion, Adelson is no newcomer to making humongous political
wagers: In the 2012 elections, Adelson donated close to $150 million, much of which went down the drain as Republicans failed to
win back the White House or the Senate. Of that total spending, some $93 million went to super PACs and committees that must
reveal their donors.
In a 2012 interview, Adelson said the main factor driving his big donations was fear that a second Obama term would produce
“vilification of people that were against him.” Adelson also alluded to a still-ongoing federal probe into allegations that the Sands
violated a U.S. law by bribing overseas officials to win business in Macau, where the company owns several lucrative casinos.
Although Adelson is still pouring millions into committees that do have to disclose donors, his dark-money footprint is expected to
increase substantially this year. GOP operatives say that Adelson’s donations in 2014 seem poised to tilt decidedly toward darkmoney outfits, a strategy that reduces the risk of his big checks becoming issues in tight Senate contests.
It’s little wonder that lots
of GOP operatives and outside groups are banking on Adelson’s bulging
checkbook to boost their election prospects this fall. Republicans view Adelson as an invaluable asset to counter
outside Democratic groups with ties to Senate Majority Leader Harry Reid, and also liberal billionaire Tom Steyer, who’s committed
to spending $50 million of his own funds to make climate change a key issue in seven Senate and gubernatorial races.
“With all the money that Democrats will have in Senate races from Harry Reid’s organization and Tom
Steyer’s organization, it’s critical that pro GOP groups be well funded,” said longtime GOP political
operative Charlie Black. “Sheldon Adelson is expected to be the single largest giver to those committees so his role is very
important.”
Adelson is known for being a hands-on donor who makes decisions carefully. Sources say he seems bullish about the GOP’s chances
of winning the Senate, noting that he has met personally with some of the leading candidates—including Rep. Tom Cotton, who’s
running against Sen. Mark Pryor in Arkansas, and Rep. Cory Gardner, who’s looking to unseat Sen. Mark Udall in Colorado. And
with just over two months before the midterm elections, sources note that Adelson-backed
ad blitzes and getout-the-vote efforts by dark-money groups could prove instrumental in helping the
GOP pick up the six Senate seats it will need to take control of the chamber.
Republican donors and operatives familiar with the casino owner say that Adelson is also ponying up big bucks to help governors
and House members, as well as favorite causes like pro-Israel groups and anti-union drives. This election cycle, Adelson’s larger
public donations include $2.5 million to the Republican Governors Association. He gave the same amount to a group in Florida
that’s fighting an initiative to legalize medical marijuana. In tandem with his wife and other family members, Adelson has kicked in
hundreds of thousands to the Republican National Committee, plus the GOP’s House and Senate campaign committees.
Last year, Adelson also launched a high-stakes lobbying drive to enact legislation that would ban
Internet gambling, an industry that competes with his casinos. Although Adelson has couched the issue in moral terms—
citing the risks that Internet gambling poses to children—the legislation would also help his casinos fend off an
online threat to their bottom line. South Carolina Sen. Lindsey Graham introduced a measure to ban Internet gambling
just months after his campaign got a $15,000 contribution from the casino mogul, who also hosted a Vegas fundraiser for Graham.
“I’m willing to spend whatever it takes” to stop online gaming, Adelson vowed in a
Forbes interview.
Although a longtime GOP sugar daddy, Adelson’s public profile has soared since the 2010 Supreme Court ruling in the Citizens
United case that ditched decades of campaign finance law and opened the door for corporations, individuals and unions to write
unlimited checks to outside groups directly advocating for or against a candidate.
Since Citizens United, Adelson has been aggressively cultivated by streams of high-powered Washington visitors—and others—
looking for fat checks in the last two elections. This year’s competition for Adelson’s
and involved new twists as rival groups who share many of the same goals vie for the most loot.
wallet has been intense
A spokesman for Adelson declined to comment on this year’s donations. But Andy Abboud,
Adelson’s top political aide,
has denied that Adelson planned to spend $100 million on Senate races, saying that “there is
no set budget for this cycle. More importantly, any group that meets with us and leaks any information true or
untrue gets cut off.” CNN first reported the $100 million spending figure this summer and suggested that it was Senate-related.
Although Adelson’s publicly disclosed donations to date
he should end up near that figure through his dark-money operations.
are far short of $100 million, sources say
Turn --- plan causes the election to become nationalized, crushing
Dems
Raju & Everett, 9/18/14 (Manu & Burgess, “Harry Reid’s plot to keep the Senate,”
http://www.politico.com/story/2014/09/harry-reid-senate-elections-2014-111115.html?hp=f3,
JMP)
Senate Majority Leader Harry Reid believes Republicans have walked into his trap.
As he’s tightened his grip on the Senate and protected vulnerable Democrats from casting
politically tough votes, furious Republicans have made the mantra “fire Reid” a rallying cry and
major fundraising push ahead of the midterm elections.
But in Reid’s mind, Republicans are training all their fire on a guy most voters barely even know.
(POLITICO's 2014 race ratings)
“I’m meaningless,” Reid, a three-decade Hill veteran and the most powerful Democrat in
Congress, told POLITICO Thursday. “People in red states don’t even know who I am.”
If Democrats keep control of the Senate this year, they believe, it will be because they have
prevented Republicans from nationalizing the midterm elections,
keeping the focus squarely on the two candidates in their respective states rather than an
unpopular President Barack Obama. For that reason, Reid has been more than willing to
shield his vulnerable Democrats from casting votes on politically charged
amendments even if he takes sustained fire from the GOP for running a dysfunctional Senate.
While Republicans say Democrats are still saddled with backing much of Obama’s agenda and
helping enact controversial laws over health care and financial services, some Republicans wish
they could make Reid’s handling of the Senate an even bigger focus this midterm season.
(Full 2014 election results)
“It should be a bigger issue,” said Sen. Rob Portman of Ohio, a top official at the Senate
Republicans’ campaign arm. “I wish it were something that more people are interested in, it’s
partly our fault in not having a way to describe it in a way that makes sense to people and how it
affects their lives.”
The Senate plans to adjourn Thursday until after the elections, avoiding many hot-button votes
over changing Obamacare, illegal immigration and taxes. It caps a yearlong effort by Senate
Democratic leaders who have the singular focus aimed at bolstering the reelection
chances of senators from battleground states — namely Louisiana, Arkansas, North
Carolina, Alaska, New Hampshire and Colorado.
AT: Asia Pivot Impact
No Pivot – ISIS and Russia
Desker 9-19 - Dean of the S Rajaratnam School of International Studies (Barry, “US pivot
unraveling,” The Straits Times, Lexis)
The United States' rebalancing to Asia, frequently described as a "pivot" to Asia, is unravelling.¶ The crisis
in the Ukraine and the rise of the Islamic State in Iraq and Syria (ISIS) highlight the challenges posed to
US policymakers as they seek to change American policy priorities to deal with the rise of Asia,
especially China.¶ As then US secretary of defence Leon Panetta noted at the Shangri-La Dialogue in Singapore in June 2012, after
the withdrawal from Afghanistan and Iraq and the drawdown of military forces in Europe, rebalancing will result in a shift from a
50:50 to a 60:40 ratio of US naval forces in the Asia-Pacific and Europe.¶ In practice, planned cuts in the defence budget would
result in major reductions in defence spending.¶ Effectively, rebalancing meant that the US would maintain its current military
presence in the Asia-Pacific while significant declines occurred in Europe.¶ Since the Cold War, America's status and interests as a
global superpower resulted in American national security planners devising scenarios where the US faced conflicts simultaneously in
Europe and Asia.¶ With the end of the Cold War, European states took a "peace dividend" and cut military budgets significantly,
unlike the US.¶ This changed under the leadership of President Barack Obama. Faced with fiscal constraints arising from growing
budget deficits, the increasing unpopularity in America of the wars in Afghanistan and Iraq, pressure for greater expenditure on
health care, social services, domestic infrastructure and education as well as his own preference for a more low-key posture on
defence issues, Mr Obama pushed for major US defence budget cuts.¶ In an era where resources were constrained, Mr Obama's
rebalancing strategy made sense. It recognised that the US would have to make difficult choices as defence budgets were reduced.¶
Rebalancing could effectively occur only if American policymakers could focus their
attention on the emerging challenges in the Asia-Pacific theatre.¶ The contemporary impact of
television and the social media has meant that the onscreen execution of two American hostages by
ISIS has suddenly had a major impact on domestic American opinion.¶ From opposition to further involvement in the
internecine conflicts in the Middle East, aside from backing Israel, Americans now support a firm response to the
rise of ISIS,
or ISIL, the Islamic State in Iraq and the Levant.¶ On Sept 10, Mr Obama announced that the US will conduct a systematic campaign
of air strikes against the ISIS forces, deploy 475 American personnel on the ground to provide training, intelligence and equipment
to Iraqi and Kurdish forces, cut off the flow of funds and foreign fighters for the ISIS forces and provide humanitarian assistance to
displaced civilians. The US will be supported by its allies in these missions.¶ American involvement¶ These
measures are the
beginning of a new long-term American involvement in the Middle East. The irony is that the
emergence of ISIS owes much to the disenfranchisement of Saddam Hussein's Baathist military and civil servants who were
excluded by the American occupying force from any role in government. Their participation has provided ISIS with the capacity to
act as a government and to fight like a conventional army.¶ The exclusion of Sunni tribes from any meaningful role in Iraq under Mr
Nouri Al-Maliki's Shi'ite-dominated government resulted in tribal support for ISIS.¶ In war-torn Syria, President Bashar Al-Assad
provided clandestine support as ISIS attacked Mr Bashar's Sunni opponents.¶ As ISIS expands its reach in Iraq and Syria and gains
the allegiance of Sunni Muslim extremists globally, it will pose problems for governments around the world. Self-radicalisation as
well as the influence of religious ideologues will lead young men and women to join ISIS.¶ Governments worry that fighters and
explosives experts trained in Middle East battlefields will return to cause mayhem and carnage on the streets of cities in the West as
well as in Asia.¶ Old conflicts take new form¶ These trends highlight the difficulty of making big strategic decisions.¶ While
the
US embarked on rebalancing to meet the challenge posed by a shift of power to Asia, especially
China, old conflicts in the Middle East took new forms seen as threatening by the US .¶ Opinion
polls shaped American policy initiatives and the important issues gave way to dealing with
immediate concerns.¶ This pattern is also seen in Europe, resulting in a renewed American focus
on Europe.¶ Russian President Vladimir Putin's takeover of the Crimea and the separatist rebellion in eastern Ukraine have
revived Western fears of an expansionist Russia. The Nato summit in Wales on Sept 4 and 5 set the stage for a new Cold War with its
support for sanctions on Russia.¶ Mr Putin's claim to protect ethnic Russians and Russian speakers outside Russia worries Russia's
neighbours, even including those with strong ties to Moscow like Belarus and Kazakhstan as well as the Baltic and Eastern European
states once part of the Warsaw Pact and now members of Nato. But the blame for these developments does not lie with Russia
alone.¶ Russia has been suspicious of American (and European) intentions since the expansion of Nato to Eastern Europe in 1996,
despite earlier assurances by president George H. W. Bush that Nato would not expand eastwards with the end of the Cold War. ¶ In
2004, seven new members joined Nato, including the Baltic states which shared a border with Russia and were historically
suspicious of Russia.¶ Western support for the overthrow of Ukrainian president Viktor Yanukovych and the European push for an
exclusive association agreement that undermined existing eastern Ukrainian trading links with Russia fuelled Russia's
masterminding of the separatist revolt in eastern Ukraine.¶ While
Russia does not have the material resources to
challenge the West and no longer has an ideological model attractive to alienated youth and emerging regimes, the US
will have to expend time and resources to reassure its European allies facing a tense
relationship with Russia.
2ac Lame Duck DA
No link --- plan passes now. This is key to ground for both sides --immediate implementation is best for predictable research and
preparation. Virtually impossible to assume the political and
economic context in which the plan might eventually pass.
Cooperation will evaporate in the lame duck and a number issues
thump
Hunter & Przybyla, 9/18/14 (Kathleen & Heidi, “Bipartisan Spirit of Congress Won’t
Extend Post-Election,” http://www.businessweek.com/news/2014-09-18/bipartisan-spirit-ofcongress-won-t-extend-post-election, JMP)
President Barack Obama’s plan to arm and train Syrian rebels is poised to pass the U.S. Senate
today with broad support though few predict such bipartisan spirit when Congress returns
to work after the Nov. 4 election.
After this week’s votes to aid Syrian rebels and fund the government to avoid a shutdown, far
messier debates over the use of military force, longer-term funding and tax policy await
lawmakers in a lame-duck session starting in mid-November.
“We have to get to the lame duck before we decide what’s possible,” Senate Minority Leader
Mitch McConnell, a Kentucky Republican, told reporters on Sept. 16. “Hopefully, we can agree
to do some things together that need addressing.”
Senate Majority Leader Harry Reid scheduled a vote for today on the Syria legislation, which
Obama requested and has lobbied lawmakers to support. The House added the measure to a bill
to finance the government until Dec. 11, passed yesterday in a 319-108 bipartisan vote.
The U.S. “can make a decisive difference” in confronting Islamic State extremists, Obama said in
a statement after the House vote. “I urge the Senate to pass this bill without delay.”
Reid has expressed confidence that the Senate will pass the measure, which would avoid a
repeat of last year’s 16-day partial government shutdown. The spending legislation, H.J.Res.
124, includes a nine-month reauthorization of the Export-Import Bank, whose charter ends
Sept. 30, the same day federal government funding is set to lapse.
Single Bill
Reid said today that the Senate will vote on the Syria aid and federal spending as a single bill
instead of taking separate votes as the House did. Some lawmakers in both parties had wanted a
separate vote on the Syria measure.
“This is a complicated issue,” Reid, a Nevada Democrat, told reporters. “The House has acted.
We got the bill last night, and we’re going to act on what they sent us.”
The majority leader also said the Senate will debate a broader authorization for use of U.S.
military force in the post-election session as part of defense legislation.
Senator Richard Durbin of Illinois, the chamber’s second-ranking Democrat, said the promise of
such a debate in November “calmed some concerns” for him and other Democrats reluctant to
grant Obama the narrower authority to arm and train the Syrian rebels now.
‘Active Part’
“I want us to be an active part of the conversation,” said Durbin. “We’re hoping to get it done
before the end of the year.”
With control of the Senate in the balance and every member of the House of Representatives
facing re-election, lawmakers are eager to head home to campaign. Republicans are slated to
retain control of the U.S. House and need a net gain of six seats to win a Senate majority.
When Congress returns to Washington on Nov. 12, lawmakers’ to-do list will include a longerterm government-funding measure and legislation setting Defense Department policy. They
may consider a set of tax breaks that lapsed at the end of 2013 in addition to a debate on
whether to authorize broader military action against Islamic State.
Some Republicans are pressing for authorization to wage war similar to what was given to
President George W. Bush before the 2003 Iraq invasion.
‘Right Now’
“We don’t think the president has the authority to do what’s necessary to be successful in
combating” Islamic State, Texas Senator John Cornyn, the chamber’s second-ranking
Republican, told reporters today. “We should be having this debate right now, not in December,
and I think there are senators on both sides of the aisle who agree with me.”
House Speaker John Boehner, an Ohio Republican, said on Sept. 16 that the measure set for a
Senate vote today “does not preclude us from revisiting the issue of a broader use of military
force.” He said it’s important for Congress “to speak on this issue.”
Tax breaks to be considered in a post-election session include a credit for corporate research, a
deduction for teachers’ out-of-pocket expenses and a break backed by Citigroup Inc. (C:US) and
General Electric Co. (GE:US) that lets U.S. companies defer U.S. taxes on financial-services
income they earn outside the country.
Democrats’ Approach
Senate Democrats want to extend almost all the tax breaks through the end of 2015, at a cost to
the Treasury of more than $80 billion. They attempted to pass such legislation earlier this year
and fell short because of a dispute with Republicans over whether amendments would
be allowed.
House Republicans have taken a different approach, voting to make a handful of tax breaks
permanent as a way to move toward a wider revision of the tax code. The Senate hasn’t taken up
those bills.
Democrats including Senate Finance Committee Chairman Ron Wyden of Oregon may attempt
to attach legislation to limit corporate inversions, transactions in which U.S. companies use
mergers to get an overseas address to cut their tax bills.
Nothing major will be dealt with in the lame duck
Sherman, 9/9/14 (Jake, “The lamest lame-duck session,”
http://www.politico.com/story/2014/09/congress-lame-duck-session-110780.html, JMP)
December will be the lamest lame-duck session in a long time.
Senate Democrats and House Republicans are privately saying that the post-election work
period will be completely uneventful, a marked shift from the past two lame-duck sessions,
which resulted in a pair of major fiscal deals.
Aside from renewing government funding in the beginning of the month, Republican and
Democratic sources privately say nothing else major — such as immigration, tax or entitlement
reform — will happen. Both sides aren’t even pretending a big legislative push is in the offing.
The most recent attempt to ensure that the lame duck lives up to its name came Tuesday when
House Republicans said they will extend the Export-Import Bank’s charter until 2015, avoiding
a December fight over what many conservatives call corporate welfare.
“Rather than [have it] be until the CR expires in December, it will be June 30 for Ex-Im
reauthorization,” Appropriations Chairman Hal Rogers (R-Ky.) said Tuesday.
There’s sure to be hemming and hawing from commentators that Washington is, again, punting
and missing a good opportunity to make progress on vital national issues. But there’s good news
for lawmakers and their staff: It looks like D.C. will get its Christmas and New Year’s back after
several lame-duck sessions that went until the last minute.
That Washington is expecting a near silent winter is a result of the uncertainty about the power
structure in the next Congress. If Republicans take the Senate, they won’t likely want to
cooperate in December. If Democrats maintain control of the chamber, the political gridlock will
remain frozen. There is only one deadline — and it is in the beginning of the month. The
incentives simply aren’t in place to make December big and bold.
Election outcome determines lame duck agenda
Lawder, 9/19/14 (David, “Spending, war disputes to dog post-election, lame-duck
Congress,” http://www.reuters.com/article/2014/09/19/us-usa-congress-lameduckidUSKBN0HE22Y20140919, JMP)
Republicans need to pick up six seats in November to take control of the Senate. If that happens
and, as expected, they strengthen their majority in the House, some issues may be delayed
until the new year, when they can flex their new political strength.
In the Senate, a Republican victory could prompt Senate Majority Leader Harry Reid of Nevada
to focus the 15-day post-election
Ending the PTC only ends overdevelopment of wind
Dismukes, 12 - professor, associate executive director, and director of Policy Analysis at the
Center for Energy Studies, Louisiana State University. His research interests are related to the
analysis of economic, statistical, and public policy issues in energy and regulated industries
(David, “Removing Big Wind's "Training Wheels": The Case for Ending the Federal Production
Tax Credit” October, http://www.americanenergyalliance.org/wpcontent/uploads/2012/10/Dismukes-Removing-Big-Winds-Training-Wheels.pdf)
If anything, the federal wind PTC is contributing to an increasing degree of
overdevelopment that is of questionable economics, and at least in part, may be creating a
number of negative externalities for other generation suppliers and consumers. While the wind
generation industry and its advocates argue that the federal PTC should be continued in order to
maintain current wind generation development and jobs, these arguments overlook the fact the
wind industry is already over-built with considerable excess capacity in many parts of
the U.S. The federal wind PTC contributes to this excess development by over-subsidizing an
industry that has become increasingly more competitive. Continuing the federal wind PTC is not
needed to maintain profitability or grow an “infant industry,” and would serve no other purpose
ut continue recent trends that distort otherwise competitive wholesale power markets and lead
to a host of hidden costs that will be paid by taxpayers and electricity customers today, and for
many years to come.
It causes a market correction – overall wind growth will still happen
Dismukes, 12 - professor, associate executive director, and director of Policy Analysis at the
Center for Energy Studies, Louisiana State University. His research interests are related to the
analysis of economic, statistical, and public policy issues in energy and regulated industries
(David, “Removing Big Wind's "Training Wheels": The Case for Ending the Federal Production
Tax Credit” October, http://www.americanenergyalliance.org/wpcontent/uploads/2012/10/Dismukes-Removing-Big-Winds-Training-Wheels.pdf)
A recent statement from Siemens Wind Energy, a major wind turbine manufacturer, highlighted
the over-subsidization created by the “one-size-fits-all” federal PTC. Siemens characterized 2012
wind generation installation levels of 6,000 wind turbines as “artificially high,” conceding not
only that “[t]he PTC…brought this artificial peak,
” but also identifying as major drivers for a needed industry correction“[natural] gas prices,
which are traditionally projected at $4 to $5 per million BTUs have stabilized at about $2 per
million BTU and, of course the economy is still lagging ... a perfect storm of events.”39
Siemens, in fact, offered an optimistic outlook for future post-PTC wind development, indicating
new construction likely would “rebound” later in the decade even without the federal wind PTC,
and even with continued moderate natural gas pricing. This highlights that any near-term, post-
PTC wind capacity contraction likely reflects an efficient market correction to address
considerable wind generation over-development, rather than any energy policy failure