Multinational Monitor

OCT 2003
VOL 24 No. 10


Subsidizing Sprawl: How Economic Development Programs Are Going Awry
by Greg LeRoy

Welcome to Wal-World: Wal-Mart’s Inexhaustible March to Conquer the Globe
by Andy Rowell

The Collapse at Cancun: A Frontline Report on the Failed WTO Negotiations
by Martin Khor


The Political Economy of Sprawl in the Developing World
an interview with Anna Tibaijuka

Out of Bounds: The Sprawling Metropolis and Its Discontents
an interview with Elizabeth Plater-Zyberk


Behind the Lines

The Business of Sprawl

The Front
The Politics of Chemistry - Nike’s Come-From-Behind Win

The Lawrence Summers Memorial Award

Names In the News


Behind the Lines

USA: #1 Arms Seller

The United States continues to dominate the global arms market, according to an August report from the Congressional Research Service.

In 2001, the most recent year for which data is available, the United States entered into nearly $7 billion in arms agreements -- more than 43 percent of the global total. U.S. arms deliveries soared above $6 billion, more than 41 percent of worldwide sales. (Arms agreements represent orders for future delivery; deliveries are actual shipments.)

Russia ranked second in both agreements and sales; China ranked third in arms agreements, while the United Kingdom was third in shipments.

The value of all arms transfer agreements with developing nations in 2001 was nearly $16 billion. This was the lowest total in real terms for the 1994-2001 period, although the Federation of American Scientists notes that similar dips have been observed during previous economic downtimes -- only to be followed by rises when economic prospects turn sunnier.

More than two-thirds of all arms transfer agreements concluded between 1994 and 2001 were directed to developing countries.

From 1998-2001, the United States entered into $35.7 billion in arms transfer agreements with developing nations, measured in constant 2001 dollars. This is more than 40 percent of the value of all such agreements during the period. Russia was the second largest exporter, supplying almost $20 billion in weapons to developing countries. France ranked third, with more than $6 billion.

The top two developing country purchasers of arms from 1994 to 2001 were the United Arab Emirates ($16 billion) and Saudi Arabia ($12.4 billion, though with much smaller purchases in recent years than in the mid-1990s). Other leading purchasers include India, China, Israel and Egypt.

Ever-Widening Income Gaps

The income of the richest 1 percent of people in the United States tripled between 1979 and 2000, as income inequalities in the United States drastically increased.

That is a core conclusion of a September report issued by the Center for Budget and Policy Priorities, based on data released by the Congressional Budget Office.

The top percentile saw their income rise by $576,000, to $862,700, from 1979 to 2000. Average income of those in the middle of the income scale rose $5,500.

The average after-tax income of the poorest fifth of households rose 9 percent, or $1,100, over the 21-year period, reaching $13,700 in 2000.

"It's been apparent for several years that those at the very top of the income scale have pulled away from other Americans, and the new CBO data, which show staggering income gains among the most well-off, confirm that trend," says Robert Greenstein, executive director of the Center for Budget and Policy Priorities. "The very well-off have been big winners on two fronts, as they secured enormous gains in income in both the 1980s and 1990s and then received extremely large tax cuts in 2001 and again this year."

In 2000, the 2.8 million people who made up the top 1 percent of the population received more total after-tax income than did the 110 million people who made up the bottom 40 percent. In 1979, in contrast, the top 1 percent received less than half as much total income as the bottom 40 percent.

Solicitous of Solicitors

Basing his decision on the First Amendment free speech rights of corporations, a federal judge in September struck down as unconstitutional a U.S. Federal Trade Commission (FTC) plan to create a do-not-call registry for telemarketing. Action by an appellate court as the Monitor was going to press enabled the FTC to proceed with the registry, despite the lower court ruling.

Under the FTC's plan, tens of millions of households have signed up for the do-not-call registry. Under FTC rules, commercial telemarketers cannot call households registered on the list. The rules do not apply to charitable or political organizations.

The American Teleservices Association and two local firms challenged the constitutionality of the FTC's plan in a federal court in Colorado.

The district court held that telemarketers have a First Amendment free speech interest in making calls into persons' homes, even though the telemarketers are corporations, not persons. Even though the FTC did not ban telemarketing, but only created a mechanism by which individuals could register to block commercial telemarketing calls, the court held that there was sufficient government action involved to implicate First Amendment concerns.

The key basis for finding the FTC registry unconstitutional was that, because it only blocks commercial phone solicitations, and not those from charities or political organizations -- entities with non-commercial purposes -- the registry discriminates on the basis of content. The government said it was trying to protect homeowner's privacy interests, but charitable calls are as disruptive of privacy as commercial solicitations. Thus, the district court held, the do-not-call registry does not materially advance the government's legitimate interest in protecting privacy.

In early October, an appellate court granted a stay, blocking enforcement of the district court's order, meaning the do-not-call registry could go into effect. That decision indicates the appellate court believes the FTC is very likely to prevail on appeal.


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