The imperative to aid development

International strategy needed
John Langmore

Thomas Kean, Chair of the US 9/11 Commission, said when launching the Commission's report that the success of Al-Qaeda's plans to attack the World Trade Center and the Pentagon were the result of American 'failure of policy, management, capability, and above all of imagination.' The Commission was applying a high standard to government, one with which Americans would concur. Could the same high standard be applied to public policy for economic and social development?

The world is confronting a far more pervasive threat to human life than terrorism in the extent, depth and consequences of poverty. What would happen if the 9/11 Commission's standard for government was applied to the imperative for development? The challenge to us is to imagine adequately the range of policies and other actions that are required to at least achieve the Millennium Development Goals (MDGs) by 2015.

The World Bank's estimates that around 1.2 billion people living in severe poverty and another two billion or so on less than two dollars a day, close to poverty. The annual number of deaths from hunger, poverty-related diseases of many kinds, poverty-exacerbated conflict, and despair from inability to earn income, exceed deaths from terrorism by a gigantic order of magnitude. Even in the US, where fear of terrorism is most intense and expenditure on counter-terrorism is enormous, terrorists killed no-one in 2002, 2003 or so far in 2004, while close to 40 million people there still live in poverty, with innumerable destructive consequences.

The following comments tell a familiar story but one for which the imperative is as compelling as ever. It touches on the poverty trap; the necessity for rapid increases in official development assistance (ODA); the rationale for Australian increases; the necessity of a distinctive Australian foreign policy for an adequate context for ODA; and the possibility of supplementing increasing aid by support for an International Finance Facility. Improving the effectiveness of aid is also important, but financing is enough for one paper. Concentrating on aid effectiveness has commonly been used as a means to obfuscate discussion of quantity. Let's not always be seduced by that diversion.

The first part of the story is to be realistic about the impediments to financing poverty-reduction within developing countries.

1. Developing country poverty trap

The poorest countries are stuck in a poverty trap. They desperately need capital for investment but lack capacity to significantly increase their domestic saving or to attract foreign direct investment (FDI).

Subsistence incomes leave little scope for saving. Micro-credit schemes are valuable and often effective, but are small in comparison with national need. In poor countries, the salaried and self-employed middle class with capacity to save or be taxed is proportionally small. There are some wealthy people everywhere who can save, invest and be taxed, but they have the strongest motivation and capacity to avoid taxes and export capital.

The rapidly growing East Asian countries, including China, have demonstrated that high domestic investment, especially reinvestment in family businesses small and large, can trigger an economic miracle. However, most poor countries have not reached a sufficient base for such substantial reinvestment.

As well, most developing countries can expect relatively little assistance from FDI. Most international financial flows are between already developed countries. In 1999 and 2000 over 60 per cent of global financial flows went to the US alone. The US is sucking up a high proportion of global saving and has become the largest debtor. Most of the remaining FDI is between other developed countries. China and a score of other large developing countries receive most of the rest.

Small, poor countries are rarely attractive to foreign investors. Their populations are small and average incomes low so markets are tiny. They can rarely offer externalities of links with other investors.1 The have poor transport infrastructure and weak human capital. It is therefore utopian and simplistic for the Howard government's White Paper on Foreign Affairs and Trade of February 2003 to argue that 'For the developing world, it is trade and investment, not aid, that will drive development Â…' We are all aware of rich countries' tariffs and subsidies that severely constrain developing country exports.

What little foreign capital developing countries do receive is often short term and volatile. Potential foreign investors normally have several location options, putting them in a powerful position to negotiate major tax concessions and infrastructure assistance. The White Paper's assertion is a delusion, a convenient rationalisation for the low level of Australia's ODA.

For example, Ethiopia's only substantial export is coffee, for which prices have collapsed, there are no substantive alternative exports, and FDI is tiny and limited to production for the domestic market and tourism.

There may well be net costs for developing countries in hopelessly attempting to fit into the 'golden strait-jacket' of market fundamentalist policies said to be attractive to foreign investors. Some of those policies, such as the rule of law, transparency, bureaucratic effectiveness, and regulatory simplicity are useful whether or not they attract FDI, but others such as policies that undermine public services are self-destructive. A necessary condition for preparation of realistic development strategy in many poor countries is recognition of the improbability of significant FDI.

Without the capacity to generate sufficient capital domestically, or to attract much FDI, impoverished developing countries require increased external concessional finance to fund infrastructure and services essential to their development. Without major external assistance, countries in which 70 per cent of people are impoverished, that are paying 60 per cent of their budgets in debt service, in which 20 or 30 per cent of the adult population have HIV/AIDS, or where the national income has fallen by 30, 40 or even 50 per cent during the last decade or two, do not have the capacity to be even close to the MDGs by 2015.

Jeff Sachs and colleagues write about Africa that 'The structural conditions and history that have led to the [poverty] trap include very high transport costs, small market size, low productivity agriculture, very high disease burden, adverse geopolitics and slow diffusion of technology from abroad. Africa's extreme poverty leads to low national saving rates, which in turn lead to low or negative economic growth rates.'2 The same constraints apply to many countries in our region.

As well as these domestic constraints, developing countries also have to cope with a hostile international environment. It is essential to recognise the extent of the inequities and the strength of the hostile political, institutional and economic structures underlying them. For example:

  • Inequality of income, wealth, and power between developed and developing countries are high and commonly (though not always) growing.
  • Developed countries account for only 15 per cent of the world's population but at the World Bank and the IMF they have 61-62 per cent of the votes.
  • People everywhere feel remote from dominating, unaccountable corporations.
  • Developing countries have been much more severely damaged by financial instability than developed countries.
  • Ninety-seven percent of intellectual property is held in developed countries.
  • And we are all aware of the impediments to market access for developing countries.

2. Concessional external finance

The alternative to the largely futile search for FDI is domestically self-reliant policies combined with increased remittances from citizens working in other countries and concessional external finance. Remittances add around a hundred billion dollars to developing country incomes, a very valuable addition to purchasing power, but not directly to investment. 3

Increased provision of grant ODA for poor countries is a necessary condition for both construction of essential infrastructure, and also for rapid growth of services. Improvements in services such as education, health, nutrition and family planning and upgrading of science, technology and innovation are essential precursors for escape from the poverty trap.

The World Bank estimated a couple of years ago that additional external financial assistance totalling in the order of $35 - $76 billion would be required each year until 2015 to even just enable countries to reach the MDGs.4 The Bank reports that such increases in aid would still on average bring recipient countries to only a third of their absorptive capacity. Assistance for these purposes would directly increase and improve productivity and employment and so speed up the rate of economic growth.

In estimates published this year, Sachs et al have made national needs assessments based on country-level investment plans for three well-governed African countries - Ghana, Tanzania, and Uganda - and concluded that in order to reach the MDGs these countries will require average annual ODA of at least 20-30 per cent of GDP each year until 2015. This translates into a doubling or more of ODA to the sub-Saharan African region in order to adequately finance achievement of the MDGs.

Such estimates have apparently not been made for countries in the Asia-Pacific region. Whether or not increases of that order are required in order to reach the MDGs in each of the Asia-Pacific countries, it would be difficult to argue that substantial increases in Australian aid are not required. They would enable this wealthy country to make a more adequate contribution to economic and social development in this region and to increase support for our neighbouring countries on the western side of the Indian Ocean as well as for those on the western side of the Pacific. A minimum goal is that set by the World Bank, of doubling ODA.

3. Australian official development assistance

It is striking that there appear to be no concrete targets either for Australian ODA or for its outputs. The Australian government does not seem to have even formally adopted the MDGs. They were not mentioned in the government's Foreign Affairs and Trade White Paper, and receive only a lukewarm mention in a box in this year's budget paper on Australia's International Development Co-operation.5 There is no mention in either document of the principal World Bank-commended instrument for planning achievement of the MDGs, the national Poverty Reduction Strategy Papers. There is only desultory mention of the value of cooperation with other donors in increasing the effectiveness of aid delivery, and little evidence of actual cooperation.

This may well be partly because of embarrassment about the low level of Australian ODA. In 2003 the ODA/GNI ratio was 0.25 per cent for Australia compared with the Development Assistance Committee ratio for all donor countries of just over 0.4 per cent. Yet Australia was one of the countries that originated the 0.7 per cent ODA target, through the monograph published by Anthony Clunies Ross in the late fifties entitled One Per Cent and the impact that had on influential NGOs and then countries.

Australia's shameful level of ODA is the result of three periods of decline: under Hawke, Keating and Hayden between 1984-5 and 1987-8 when the ratio of ODA to GNI fell from 0.46 to 0.34 per cent; under Howard, Costello and Downer in 1996-7 when the fall was from 0.32 to 0.28 per cent; and under the same team in 2000-1 when the fall was from 0.29 to 0.25 per cent. Under Prime Ministers Fraser, the later years of Hawke, and Keating, Treasurers Kerin and Willis, and Foreign Minister Evans, ODA was held virtually constant as a proportion of GNI.

Australia is amongst the lowest taxed developed countries. Therefore the annual battle over expenditure is extremely intense - though no doubt there is also a fierce contest in countries with much higher proportions of revenue. It is a terrible struggle to even maintain aid proportions during the Expenditure Committee meetings of Cabinet, let alone to increase them, when in competition with high priority, demanding domestic programs.

Yet demonstrably Australia has the capacity to increase ODA. Australia ranks third behind Norway and Sweden in the Human Development Index. Gross domestic product has been growing by about four per cent a year for the last decade so per capita income is higher than ever before. Australia has one of the lowest levels of government debt to GDP in the OECD. There is a budget surplus. So there is clearly capacity to increase ODA.

The Howard government rightly describes Australia as occupying a distinctive global position because of its unique intersection of history, geography, economy, society and culture. The White Paper describes Australia as 'a Western country located in the Asia-Pacific region with close ties and affinities with North America and Europe and a history of active engagement throughout Asia.'6 It is therefore distinctly odd that this does not lead to heightened government responsiveness to the impoverished half of humankind.7

There has been some improvement during the last year. Though overdue, the intervention in the Solomons was valuable and the cost added significantly to ODA for the year, just as did earlier support for Timor Leste. However one of many costs of engagement in the immoral, illegal and ill-advised war in Iraq has been diversion of aid there, at the cost of continuing stagnation or decline in aid to Africa, India, Bangladesh, Cambodia, Vietnam and other regions and countries with high levels of poverty.

Some Australian officials said after the International Conference on finance for development in Monterrey that other countries would not honour their commitments. It remains to be seen whether all will do so, but many are, and some are strengthening their commitments even further. The most important recent example is Britain where Gordon Brown, the Chancellor, has announced that the annual allocation for the Department for International Development (DFID) will rise by 9.2 per cent a year in real terms this year and in each of the following three years, taking British ODA to 0.47 per cent of GNI. The Government aspires to reach 0.7 per cent by 2013.

Since the Monterrey conference, Belgium, Finland, Ireland, France and Spain have made firm commitments to join Denmark, Luxembourg, the Netherlands, Norway and Sweden in contributing over 0.7 per cent of GDI to ODA. Australia will confirm its position as an isolated, negligent, and selfish state if we have not set at least an interim national target for increasing ODA by the time of the global summit to review progress on the Millennium Declaration at the UN in September 2005. The Labor platform commits and Labor Government to the modest target of 0.32 per cent of national income - restoration of the proportion of aid when the Keating Government was defeated in 1996. That would not bring us close to the levels of the European Community but would at least reverse the trend of the last thirty years. What prevents that happening, and what could be done to encourage it?

4. Impediments within Australia

(i) Misjudged foreign policy

The principal impediment at present is distorted Australian foreign policy. The central feature of the Howard Government's foreign policy has been the strength of its commitment to the American alliance. Imitation has been the characteristic form of expression of that commitment, in ideology, policies, tactics and even rhetoric.8 Australia's interests have been subverted by acquiescing to American preferences. Australia has supported America in discarding international law and denunciation of international institutions, which has undermined international order and diverted attention from fundamental humanitarian issues.

Australians and Americans are more insecure as a result of these policies, not only because of the increased risk of terrorist attack but also because of increasing global disorder, the devaluation of multilateral diplomatic peace-making, the militarisation of foreign policy, and the consequential relative neglect of development. Australia would be a better friend to the US by urging military restraint and multilateral cooperation, than by collaborating in illegal aggression.

Renewed commitment by Australia to multilateral cooperation could include adoption of agreed multilateral goals, strategy and targets. For Australia the choice is whether to continue to be subservient to the global hegemon, or to participate with dignity as an autonomous, distinctive state in the struggle for international peace and justice. If we choose the latter, transformation of our development strategy must follow. The UN global summit in September 2005 will be an opportunity for member states to renew commitment to a rule-based international order.9

By copying the Bush Administration in exaggerating the danger of terrorism, the Coalition Government has strengthened the fears of those who were already insecure, strengthening the justification for inter-operability with US defence strategy, and continuing to do little about those factors which contribute to motivating terrorists.

Military action is not the principal part of the solution. Yet Australia is spending eight times more on the military than on ODA. Defeating the Taliban or Saddam Hussein does not eradicate terrorism. While electorally appealing, the metaphor of a 'War on Terrorism,' is misleading, for it implies that the way to counteract terrorism is military action against states. Terrorists are partisan militias, which are not usually state-based. War cannot be waged against an abstract noun.10

A sophisticated, multifaceted strategy is required, including at least five parts applied simultaneously: homeland defence; pursuit and punishment of terrorists; action within countries of origin, supported, whenever sought, from outside; addressing the political repression and exclusion that causes grievances; and addressing the underlying social, economic and cultural issues that cause injustice, poverty and despair.11 12

(ii) Misunderstanding and ignorance

A second major impediment to higher ODA is public ignorance and political misunderstanding. In America, the public is ignorant of the level of aid. As well, politician's under-estimate the extent of public support for aid. It was my impression when a member of parliament that both forms of misunderstanding were common in Australia and that might still be true.

A study of public attitudes about foreign policy by the University of Maryland found that while policymakers believed the public wanted the US to disengage from the world this was not, in fact, the attitude of the majority. Two out of three respondents said that the US should be active in world affairs. The majority said that they wanted America to move away from the role of dominant world leader, or global sheriff. They also believed that the US did more than its fair share in international relations.13 The basis for the view that the US did more than its fair share was extreme overestimation of how much it actually did.

Most Americans supported the principle of aiding developing countries, but over-estimated the amount given by the US by between 10 and 20 times. That is, the median estimate of the proportion of the US budget given as foreign aid was between 10 and 20 per cent in various surveys, when in fact it is less than one per cent. When asked what proportion they thought it should be, the median response was five per cent, more than five times higher than the actual level. 14 Surveys conducted since 9/11 show generally similar results.

As in America, common sense generally prevails in Australia, if people are given enough accurate, relevant information. It is therefore shocking to find that this year AusAID has been allocated the miniscule amount of $2.8 million for development education. This is to cover 'expenditure on media, outreach, publications, internet and global education activities for 2004-05.'15

Not much more that a thousandth of the aid budget to inform the public about Australian development activities seems likely to be quite inadequate. It is surprising that the Foreign Minister has not used the Ggovernment's ubiquitous pre-election 'public information program' to justify ads on aid! Perhaps Alexander Downer is too ashamed to want to publicise the program.

Fortunately some NGOs are far more active, the news services play a role, and even ER has included excellent episodes on medical relief work.

5. International finance facility

It is unlikely that increasing ODA alone will be sufficient to provide all the needed and justified funding, so it is important to actively consider other feasible possibilities. That is the reason for the British proposal to establish an International Finance Facility.

The proposal is that the donor countries make guarantees about future levels of aid, which could be used as security to borrow additional funds needed to support developing countries aiming to achieve the MDGs. It is also proposed that the donors should undertake to increase the annual amounts that they have initially pledged by 4% a year in real terms, with an initial promise to continue this for 15 years. The idea would be to use the financial markets for bringing the crucial expenditures forward.

This is justified, it is held, on the ground that the social rate of return on the MDG-directed outlays would be very high: higher than the rate of interest that would have to be paid on the loans raised. Though raised through loans, the actual disbursements to developing countries would be made in most cases as grants. The loans would be serviced by the contributions committed by the donor governments.

A financial-intermediary institution would be created by the donors jointly. It would raise and service the loans and receive the donors' contributions. It would not act as a development bank or an aid agency. Each donor government would select the projects to be assisted by the payments that its contributions were financing. But the intention would be that these projects would be coordinated among donors; and that they would observe agreed guidelines in both their selection of projects and their aid practice (for example, a priority to poverty-reduction and avoidance of source-tying).

The donor governments would make 'legally-binding commitments' of contributions for the relevant periods. On this ground the financial institution could expect to be able to issue bonds with triple-A rating, hence at low interest rates. Projections of real-term cash-flows show donor contributions rising at a constant rate for about 30 years, and disbursements to low-income- and middle-income-country recipients rising sharply to a peak of around an annual $50 billion for a run of years ending in 2015, after which they would fall to zero. The proposal has the full support of France as well as the UK and is being studied by the World Bank.

Two criticisms have been made. One is over the requirement of legally-binding forward commitments. However, defence contracts often stretch well into the future, and governments make undertakings to borrow and repay loans without any special legislative commitment. A second relates to the sharply peaked time-pattern of the projected aid disbursement. It is argued that the terms on which aid can be most usefully employed is not likely to fit such a pattern. In answer, the British suggest that there is a capacity to absorb aid at this rate until 2015.

Other more innovative possibilities are also essential if sufficient funds are going to be generated to achieve the MDGs let alone any more ambitious targets. Another possibility is to restart regular issues of Special Drawing Rights (SDRs) by the International Monetary Fund and for developed countries to voluntarily reallocate them to developing countries. Countries with 75 per cent of the votes at the IMF supported such an issue in 1997.

The issue of new and innovative sources of financing is within the category of domestic revenue since only national governments have the power to tax. Improving international cooperation about taxation to clamp down on tax avoidance and evasion could generate many billions of dollars. Many other possibilities are available, including a carbon tax and a Tobin tax. Both of these are technically feasible. The question is whether there will ever be sufficient concern about global economic, social and environmental security to introduce them.

To conclude, after a half century of rapid and widespread economic growth, the world is richer than ever before in human history and has unprecedented technological capacity. Yet most of that wealth is concentrated in the rich, donor countries. Some of those countries have accepted the responsibilities that automatically follow from privilege, and more have announced plans to do so. Australia is not amongst them.

There are clear religious, humanitarian, political, economic and social imperatives why Australia should act with fairness and decency. In present global circumstances a necessary condition for doing so is to set a target date for doubling the proportion of aid to GNI. Would 2010 be impossible? Nothing less would be an adequate expression of support for developing countries struggling to escape from the poverty trap. Nothing less would be an adequate commitment to achieving the MDGs.

Both major parties accept that Australia has global as well as regional interests. Most Australians are supportive of people in need. Let's imagine what that really means, and act with resolution accordingly. The government would be an opportunity to abandon defeatism, renew hope, and make a strong commitment to a wise and generous international strategy. Australia is secure and could be a force for international peace and justice.


John Langmore is the Director of the New York Liaison Office of the International Labour Organisation to the United Nations, a former member of the Parliament of Australia, and a former memeber of the executive committee ofthe Evatt Foundation. This paper comprises introductory comments on the issue of trade and labour linkages for the conference on "Linkages: How do we bridge the gap?" convened in Washington on 22 April 2004. John Langmore can be contacted at langmore@ilo.org.


Notes

1. Strengthening regional cooperation could increase the attractiveness of some groups of countries to potential foreign investors, but this is complex to negotiate and slow to have effect.

2. Jeffrey D. Sachs et al, Ending Africa's Poverty Trap, Millennium Development Project, 10 May 2004.

3. Estimated by Dilip Ratha of the World Bank at $ 93 billion, reported in The Economist, 31 July 2004, p 64.

4. Shantayanan Devearajan, Margaret, J. Miller and Eric V. Swanson, 2002, 'Development Goals: History, Prospects and Costs,' World Bank Policy Research Paper. 2002. The funding needs for universal primary education for all, including all girls, will be at least $10 billion a year and could be as high as $30 billion; the health related goals such as reduction of infant mortality and infectious diseases require between $20 and $25 billion a year; and universal access to water and sanitation and of 'secure land tenure and upgrading in slums' a further $5 to 21 billion.

5. Commonwealth of Australia, Australia's International Development Cooperation: Statement by the Honourable Alexander Downer MP, Minister for Foreign Affairs, 11 May 2004, Canberra, p10.

6. Commonwealth of Australia, White Paper on Foreign Affairs and Trade: Advancing the National Interest, Canberra, 12 February 2003.

7. Aid is but one of a number of a number of major international issues in which Australian performance is humiliating. Disengagement from multilateral consultation about financing development is another. At the most important international conference on finance for development in a generation, held in Monterrey, Mexico in March 2002, Australia was one of only a few donor countries which failed to announce any increase in actual or targeted ODA. Australia was one of only two donor countries not represented by a minister - the other being Portugal where an election was being held. In contrast even the US delegation was led by President Bush and included Secretary of State Colin Powell, and Secretary of the Treasury Paul O'Neill.
In September 2002 there was a long scheduled day of discussion in the UN General Assembly on the New Economic Programme of African Development (NEPAD), an initiative of five leading African governments. While Prime Minister Chrétien was eloquently describing Canadian support for the Programme, the African Presidents responsible for the initiative were present and listening, Colin Powell was sitting in the lead position for the American delegation, but no one, no one, was sitting in the Australian seats.
The Australian Ambassador to the UN frequently says that the UN Economic and Social Council is virtually moribund. He exaggerates, but the Council is certainly far from fully effective. Yet the Mission has done nothing to change that. At the first ECOSOC meeting in 2003, when the plans were being made for the year, only two seats were vacant, those of Australia and Benin. All other major countries and groups were present and spoke. Australia can continue to remain outside these discussions, but by doing so we simply exclude ourselves from debates that all other countries take seriously.
Australia has an interest in representation at such discussions, for some of the issues affect Australians directly, others involve the evolution of global policy, and for yet others moral concerns would lead to participation. It is neglectful of the interests of Australians for the country to neglect these discussions. If every other comparable country takes these events seriously, it is reasonable to expect the Australian government to do so too.
Withdrawal from the International Fund for Agricultural Development, an effective agency working where most of the poor live, in rural areas, is an explicit rejection of a substantial, constructive poverty reduction program. It is concrete evidence of the Howard Government's rejection of concern for social justice, and contributes to defining Australia as a pariah state.

8. Geoffrey Barker, the Foreign Affairs and Defence editor for the Australian Financial Review writes 'No previous Australian government since the Curtin Government in wartime raised the [American] alliance to such exulted status, with so little regard for other Australian global and regional interests and relationships, and so little concern for possible forgone alternatives.' 'Stretching the friendship,' The Australian Financial Review, 31 January 2004.

9. One question is why obsequious foreign policy, passivity to impoverishment, and brutal treatment of asylum seekers have been acceptable to a substantial group of Australians. The reason may well be inflamed insecurity. Terrorism has certainly exacerbated fear. But before 9/11 and 12 October, neo-liberal globalisation had been eroding the economic security of many. Globalisation has been a major cause of personal and social disruption and so of insecurity. Many governments and commentators have been unconcerned about the human cost of repeated policy change, with the consequences of which we have all had to deal. Leaders mistook 'self-inflicted social wounds for economic realism.' Market fundamentalists neglected the human and social destructiveness of their policies.
The Howard Government has been even more closely aligned to this ideology than the Hawke and Keating Governments and was therefore vulnerable to being perceived as the current cause of this economic insecurity. To give the impression of distancing itself from unpopular manifestations of globalisation, and to appear to reassert national control over disturbing international threats and trends, Howard used xenophobic social policy to create a sense of national independence. One motive for his Government's attacks on the UN treaty system may have been to create the impression of resisting international influence in Australian affairs.
In addition, by copying the Bush Administration in exaggerating the danger of terrorism, the Coalition Government has strengthened the fears of those who were already insecure, strengthening the justification for inter-operability with US defence strategy, and continuing to do little about those factors which contribute to motivating terrorists.
Terrorist attacks are monstrous crimes against innocent people. A variety of fanatical groups with different grievances has been responsible, most operating across borders. Military action is not the principal part of the solution. Yet Australia is spending eight times more on the military than on ODA. Terrorists are rarely state-based. Defeating the Taliban or Saddam Hussein does not eradicate terrorism.

10. Terry Jones, Daily Telegraph, January 12, 2002. See http://www.commondreams.org/views02/0112-02.htm

11. Gareth Evans, 'Why the war on terror is not going well,' International Herald Tribune, 11 September 2003.

12. An important element in international counter-terrorism strategy is the work of the Financial Action Task Force (FATF) of the Bank for International Settlement's Basel Committee on Banking Supervision. The FATF is concentrating on two principal strategies: 'The first is to improve regulation and supervision of informal payments mechanisms, such as alternative remittance systems, and of non-profit organisations, notably charities.' The second is to improve co-operation and information sharing - both within individual countries and across national borders, among law enforcement agencies, supervisory authorities, financial intelligence units and other operational arms.

13. Steven Kull and I. M. Dessler, Misreading the Public: the Myth of a New Isolationism, Brookings, 1999 p 251.

14. Kull and Destler, ibid. This leads to the question of why there was such a gap between policymakers' perceptions and public opinion. Part of the explanation is that attitudes are misinterpreted. Resistance to a hegemonic role for the United States can be interpreted as a preference for withdrawal, rather than for sharing the burden with other nations. The gap persists because voters do not generally give priority to international issues when deciding how to vote; domestic issues are more important to them. Congress members' relative inattention to international matters may have been one of many factors adding to voters' sense that policymakers inside the Washington beltway were out of touch. The authors conclude that 'Americans do appear to have a sense of history, a recognition of global interdependence, and a desire to see their nation make a meaningful contribution for both selfish and altruistic reasons.'

15. Commonwealth of Australia, 2004, op cit, p51.

See also: