On January 22, the Worldwatch Institute, a group having the goal of bringing the global community together to address climate change, environmental degradation, population growth, and poverty, approvingly said about the UN’s Convention on the Law of the Sea: “The Law of the Sea [Treaty] has set international standards for fishing, deep sea mining, and navigation since the majority of the world’s countries signed it in 1982. It provides coastal nations with exclusive rights to ocean resources within 200 nautical miles of their borders — areas known as ‘exclusive economic zones,’ or EEZs.” (Note: the treaty was initiated in 1982, but didn’t enter into force until 1994.)

“The agreement also oversees an international tribunal to settle fishing, pollution, and property rights disputes, as well as the International Seabed Authority, a body formed to assign mining rights beyond the EEZs.”

The institute went on to claim, “President Obama’s administration and current Senate leaders have already expressed support for the treaty ... [and] it is supported by a wide array of interest groups, including the U.S. Navy and Coast Guard, international environmental groups, and the mining, fishing, shipping, and telecommunications industries.”

But if the Law of the Sea Treaty is such a winner, why hasn’t the U.S. Senate ratified it before now? Do we have a case of politicians being grotesquely stupid, or a case of salesmanship by the Worldwatch Institute, or simply an evolving treaty?

Let us see.

In 1982, President Ronald Reagan said about the treaty: “Those extensive parts dealing with navigation and overflight and most other provisions of the convention are consistent with U.S. interests and, in our view, serve well the interest of all nations.... Our review recognizes, however, that the deep seabed mining part of the convention does not meet United States objectives.”

And the Reagan administration was right to be concerned. The treaty, if ratified by the United States, would mandate that U.S. corporations that wanted to mine any “mineral” — oil, natural gas, gold, silver, etc. — from the “Area” (the deep oceans more than 200 miles from shorelines) would have to get permission from a UN entity called the “Enterprise,” and permission could be denied to anyone for most any reason. Also, to get permission from the UN, companies would be required to give to the Enterprise for its use — and possible dissemination — any and all new technologies that it (or any other company) had developed to access the minerals, including mining equipment, robotic technology, new submarine technology, etc. So much for competitive advantage and making money off patents and intellectual property rights.

Also, if a corporation would get permission to mine, the Enterprise would set a limit on the quantity of material that could be mined, ostensibly to protect developing countries’ sources of income (i.e., if a poor country mined zinc and relied on it for income, the Enterprise would limit access to zinc so as not to let worldwide zinc prices fall). Even after a company got permission to explore and the minerals were mined, the Enterprise would stay involved. The Enterprise would then take possession of the minerals and sell them (global governmental authority), keep a cut for itself (global tax), and finally give the corporation a share of the profits (global socialism). It would be a setup that a mafia Godfather would envy, with opportunities galore for skimming payouts, redirecting funds, and making payoffs — and this is the brief description; the treaty was actually much worse. For example, the treaty would have given the UN’s institutions and employees virtual worldwide immunity from scrutiny — crimes cannot be prosecuted when they cannot be proven.

To pass the treaty in the U.S. Congress over Reagan’s concerns, an addendum to the treaty called the Agreement on Part XI was added to the treaty. The “Agreement” — in the form of an addendum — cut some language from the original treaty and superseded other parts. If the original treaty and the Agreement are found to be in conflict, the Agreement would take precedence. We are told that there is now no longer any reason not to ratify the treaty.

That’s not true.

What is true is that some of the concerns about deep sea mining have been addressed by the addendum — e.g., virtually any company that could afford the $250,000 application fee to explore for minerals and could meet the technical and legal hurdles enacted by the International Seabed Authority, the “Authority,” such as an “amount equivalent to US $30 million in research and exploration activities,” would normally be given permission to search (but companies could still be disapproved by a two-thirds majority of the “council” — I wonder if two-thirds of countries in the world hate the United States?). However, there are still many substantial drawbacks to the deep sea mining part of the treaty.

Mining Rights
Though the treaty no longer blatantly demands that the Enterprise be given intellectual property rights for new technologies in return for exploration and mining rights, the treaty does say: “The Enterprise … shall seek to obtain such technology on fair and reasonable commercial terms and conditions on the open market, or through joint-venture agreements; … [but] if the Enterprise or developing States are unable to obtain deep seabed mining technology, the Authority may request all or any of the contractors and their respective sponsoring State or States to cooperate with it in facilitating the acquisition of deep seabed mining technology … on fair and reasonable commercial terms and conditions, consistent with the effective protection of intellectual property rights. State Parties undertake to cooperate fully and effectively with the Authority for this purpose and to ensure that contractors sponsored by them also cooperate fully with the Authority.” It adds, “As a general rule, States Parties shall promote international technical and scientific cooperation with regard to activities in the Area.”

In layman’s terms, this means that the Enterprise or a developing state can offer to purchase new technologies from companies for what the UN affiliates consider to be a “fair and reasonable” price. If the companies refuse an offer, all countries that have signed the treaty must work to obtain the new technology for the UN affiliates, and the companies are stuck receiving the “fair and reasonable” price anyway.

That the word “cooperation” in the treaty really means “coercion” is reinforced by article 302 of the convention, which says in part: “Nothing in this Convention shall be deemed to require a State Party, in the fulfillment of its obligations [to transfer technology] under this Convention, to supply information the disclosure of which is contrary to the essential interests of its security.” In other words, military technology is off limits, but anything commercial is fair game.

This should cause nightmares for all U.S. manufacturers, not just ocean explorers, because this verbiage covers all new technologies used to access the ocean’s mineral resources, not just new technologies specifically designed for that purpose. If an oceangoing craft carries a company’s patented item and that item is used for exploring or mining the ocean floor, the intellectual property rights to it must be sold to a UN affiliate for what the UN or a developing country deems is “fair” — whether that technology be for a new submarine; new plastic, ceramic, steel, or glass; new computer software; a new engine design or underwater drill; or a water-purification system. The list is endless.

And not only must technological wherewithal be supplied to the UN affiliates dirt-cheap, but companies must train foreigners in their use “by providing opportunities to personnel from the Enterprise and from developing States for training in marine science and technology and for their full participation in activities in the Area.” Again, so much for competitive advantage and making money off patents and intellectual property rights.

Also, just because all companies have an opportunity to explore for minerals doesn’t mean they’ll be given permission to access the minerals they find. “Prospecting may be conducted simultaneously by more than one prospector in the same area or areas,” and in deciding which companies get “production authorizations,” the Authority “shall give priority to those applicants which … give better assurance of performance, taking into account their financial and technical qualifications … and provide earlier prospective financial benefits to the Authority.” And the “selection [of those who get production authorizations] shall be made taking into account the need to enhance opportunities for all States Parties.”

Minding the Minerals
Like the language dealing with transferring technology to the UN affiliates, the section of the treaty dealing with profit-sharing has also supposedly been “fixed” by the Agreement to Part XI, but has it?

Because the Area has been deemed by the UN to be the “common heritage of mankind” — to be exploited for the good of all the Earth’s inhabitants — the original treaty would have mandated that the Enterprise would be responsible for “the transporting, processing and marketing of minerals recovered from the Area.” Much of the profits of the sales of the minerals would be set aside to go toward aiding the world’s poor.

To that end, the Authority — another UN affiliate created by the treaty — and “all interested parties” would “take measures necessary to promote the growth, efficiency and stability of markets for those commodities produced from the minerals derived from the Area, at prices remunerative to producers and fair to consumers. All States Parties shall cooperate to this end.” This would have amounted to flat-out price-fixing and would have included reliance on “production ceilings” based on 15-year mining-production “trend lines.” Companies would get their cut of the profits based on a complicated profit-sharing formula. The companies’ minimum yearly fee for the right to mine would have been one million dollars and would have gone up from there — taking more than 70 percent of companies’ net proceeds if the companies would make more than a 20-percent return on investment.

In the present iteration of the treaty, the production caps and trend lines have been eliminated, but the other bad stuff is still there — only it’s probably worse than before. It’s worse because though the specified profit-sharing system that had been planned has been scrapped, no replacement has been designed, leaving open the possibility that the Enterprise would demand an even larger piece of the pie. It’s a matter to be dealt with at a later date: “Consideration should be given to the adoption of a royalty system or a combination of a royalty system and profit-sharing system.” Plus, there is still an annual fee (though the amount of this fee also has yet to be determined). Under the revised treaty, the Enterprise would still take title to the minerals after they are mined, process them, sell them, and give the company a cut. The company’s share of the proceeds is unknown as of yet: “The rates of payments under the system shall be within the range of those prevailing in respect of land-based mining of the same or similar minerals in order to avoid giving deep seabed miners an artificial competitive advantage or imposing on them a competitive disadvantage.”

How would, or could, it work? Imagine yourself as a business owner who has risked everything to mine ocean diamonds. You hit the jackpot, not only discovering diamonds but devising a method to extract the diamonds. According to the treaty, you would be required to hand the rough stones to the Enterprise, either for immediate sale or to cut and polish and then sell. You would wait for your share of the proceeds of the sale of the minerals, having no idea how long it will be until you will get paid or how much you will get paid. You don’t know the end weight of the gems after the UN cuts them (so you can’t hazard a guess as to how much money the stones should fetch), nor do you accurately know the color, clarity, and flaws of the stones. In fact, you don’t know for certain if you will get paid at all because you don’t know what type of safety system will be set up to protect the diamonds from theft.

It’s plain that even though the original treaty has been altered by the Agreement on Part XI, the system is still a Mafioso’s dream — with opportunities for fraud in nearly every step of the process.

How many honest businessmen would want to be involved with such a regulatory regime, especially one with the track record of the UN — remember the oil-for-food fraud in Iraq and the sex-for-food scandals throughout Africa?

Worse, as a businessman, even if you believe that fraud is taking place at the Enterprise and that you are not being given a fair price for your minerals, there is virtually nothing you can do to remedy the situation — other than to complain to the same organization that you believe is ripping you off, or to its sister organization, “The Seabed Disputes Chamber of the International Tribunal for the Law of the Sea.” There is virtually no way for even a sovereign country to investigate fraud at the UN affiliates, let alone a company doing so.

The wording of the treaty provides nearly blanket immunity to the UN affiliates: “The Authority, its property and assets, shall enjoy immunity from legal process except to the extent that the Authority expressly waives immunity in a particular case.” Moreover, “The property and the assets of the Authority, wherever located and by whomsoever held, shall be immune from search, requisition, confiscation, expropriation or any other form of seizure by executive or legislative action.” There are also prohibitions against accessing the Authority’s “archives” and its “official communications.”

The Enterprise has similar immunities, except that it is subject to the “legal process” — sort of. Though legal “actions may be brought against the Enterprise … in the territory of a State Party,” the “property and assets of the Enterprise, wherever located and by whomsoever held, shall be immune from all forms of seizure, attachment or execution before delivery of final judgment against the Enterprise.”

In other words, a legal case against the Enterprise must be won without any physical evidence taken from the Enterprise because before any property of the Enterprise can be seized, a case in court has to be won. It would take an awfully moronic criminal to be caught for misdeeds under the aforementioned immunities.

And this isn’t the worst of it.

Double-dealing With Dictators
Abuse of the system is bound to be systemic — from the very top echelons to the lowermost rungs — because of something called “reserve areas.” The Agreement says: “Designation of a reserved area for the Authority … shall take place in connection with approval of an application plan of work for … exploration and exploitation.”

What this means, according to Annex III of the treaty, is that when a company discovers minable minerals that it wants to attempt to recover, it must supply, as part of the application process, the location of a second, commercially profitable area to mine. Then the Authority will take one of these areas for its own use (the area that shows the most promise of profit, obviously) and allow the company to mine the other. The Enterprise, on behalf of the Authority, would mine the reserved area either solely or as part of a joint endeavor with a company, a developing state, or an individual in a developing state.

Of course, neither the terms of the joint ventures, including the level of profit-sharing that will take place, nor the manner in which the joint-venture contracts would be awarded are defined. Considering that “developing countries” are typically run by strongmen and all-around nasty characters, the chances that a graft-ridden, under-the-table-payment, you-scratch-my-back-and-I’ll-scratch-yours, quid-pro-quo system forming, to the benefit of the criminally inclined, is 100 percent. (Even if the terms of the contracts and payments were formulated and set in stone, that would do nothing to curb the built-in incentives to pay and receive bribes.)

And the potential for graft is not limited merely to members of the Enterprise and the Authority; it will pervade the UN and beyond.

This is true because when the Authority provides economic assistance to developing nations — the ostensible purpose behind giving the UN control of the oceans’ mineral wealth — the assistance will be provided, “where appropriate, in cooperation with existing global or regional development institutions which have the infrastructure and expertise to carry out such assistance programs.” That is, the assistance monies would be filtered through the main body of the UN, the International Monetary Fund, the World Bank, etc. — all organizations that have atrocious track records when it comes to successfully implementing poverty-reduction programs.

Not only have the poverty-reduction plans by these groups not resulted in less poverty in the countries receiving aid (“In the 1970s, Africa had 10 percent of its population living in poverty; today that number is over 70 percent,” reported foreign-aid expert Dambigo Moyo), it is no accident that the poor in these countries became poorer — the programs are designed in a manner that guarantees corruption and failure, which too is no accident.

Former French President M. Jacques Chirac, a longtime mouthpiece for increased UN-managed foreign aid, acknowledged, “Only one third of international disbursements currently go to fighting poverty.” Most of the rest of the monies go to vague administrative costs, are used for projects not related to poverty, or are siphoned off by corrupt officials. And even much of the one-third of the money that does “go to fighting poverty” isn’t actually being spent on poverty reduction. When it reaches the corrupt countries, it goes to the leadership of the countries, who send it out of the country — to be used to retain a life of creature comforts in case of a coup d’état — or use it to solidify their power base.

The IMF, World Bank, and other international “aid entities” work hand in hand with the corrupt leaders — but for their own ends. The “aid entities” loan money, obtained from the world’s taxpayers, to known power-hungry and criminal leaders to gain leverage in the poor countries. This leverage is exploited to benefit the world’s politically well-connected and super-rich. They do this by attaching “conditionalities” to the monetary handouts. The Inter Press Service reported that these conditionalities include “opening … markets to corporate agri-business and cheap food imports, which threaten farmers’ livelihoods, as well as mining and other environmentally destructive projects.... Such conditions subject the poor to deeper poverty.”

The poor countries often take on so much debt that they can only make payments covering the interest on the debt — which they pay year-in and year-out. Jubilee USA Network, an advocate of international aid, said in 2006: “Liberia’s external debt stands at $3.7 billion, a sum which represents almost eight times the country’s annual GDP.” Of course, if a country refuses to service its debt, worldwide financial credit dries up, pushing the lackluster leaders to print money and cause massive inflation, destroying the country’s economy — see Zimbabwe. These types of programs always fail the poor in the end.

In March, the Washington Post reported, Secretary of State Hillary Clinton commented about the aid the United States has given to Afghanistan. The gist of her message was that “the billions of dollars spent in U.S. aid to Afghanistan over the past seven years have been largely wasted.” Clinton specifically said, “There are so many problems with [aid programs]. There are problems of design, there are problems of staffing, there are problems of implementation, there are problems with accountability.”

The aid “works” mainly for the corrupt. When, after more than 60 years of redesigning and reimplementing international foreign aid, the end result has been massive increases in poverty, one wonders why anyone would insist on giving the international aid entities more money. (To read more about the failure of foreign aid, read “Give ’Til It Hurts, Repeat,” May 11, 2009 issue, and “X-ray Analysis of Foreign Aid,” December 11, 2006.)

Not only are the international aid entities designed in such a manner as to virtually guarantee fraud and failure, so is the Law of the Sea Treaty. And the treaty’s flaws go beyond the obvious design flaws described herein (and the egregious design flaws in the treaty having to do with controlling commercial fishing on the oceans and with controlling military activities, which space constraints do not allow us to delve into here). Perhaps a more important flaw is the premise on which the Law of the Sea Treaty is based.

Wealth-redistribution Fallacy
The Law of the Sea Treaty is based on the idea that there is a static amount of wealth in the world and that the best way to help the poor around the world is through penalizing technologically advanced countries and forcefully redistributing wealth through benevolent leaders who have worldwide clout. But nothing could be further from the truth, which should be obvious to anyone who reads the news. Right now the world is facing a severe economic downturn, much of which is owing to people in the United States spending less money. Before the economic bust, any country that put into place practices to encourage economic development and individual freedom was booming — based largely on U.S. citizens spending money. Too bad in the present case, the wealth Americans were spending was illusory, brought on by Federal Reserve policies of printing money and keeping interest rates low, which was bound to end in an economic bust. But if Americans had been spending real wealth gained by recovering the ocean’s minerals, the worldwide boom could have gone on indefinitely.

The wealth-redistribution fallacy is wrong and hurtful to the poor, as is the assumption that the international aid agencies are a wise method of ending poverty. Equally as flawed is the idea that individuals and companies should have to abide by the dictates of a centrally planned distribution mechanism — global government, a virtually unaccountable group of handpicked individuals who answer to the bureaucratic elites who put them in power. There is no chance that in the long-term, or even the short-term, these elites will do what’s in the best interests of the middle-class and poor citizens of the world, or that their judgments can take into account the literally uncountable variables (trillions of variables would fall far short) that affect individual businesses doing what businesses do: creating, buying, and selling.

The proponents of this treaty, such as Scott G. Borgerson, who wrote an article backing the treaty for the Council on Foreign Relations entitled “The National Interest and the Law of the Sea,” would have us believe that the United States should accede to the treaty because virtually all other developed countries have done so. Not signing on to the treaty, he claims, “tarnishes America’s diplomatic reputation at a critical moment in international relations” and has led to “American energy and deep-seabed companies … [being] put at a disadvantage in making investments for seabed minerals projects by the legal uncertainty accompanying the United States remaining a nonparty.”

Borgerson is technically right, but he is practically wrong. He is right that in this era of supposed tightening of global unity a decision to disavow the treaty will ruffle the world’s powerbrokers, but we’d do well to remember motherly advice against jumping off a cliff just because others do it and that true “leadership” requires taking the noble path and sometimes making unpopular positions. Borgerson is also correct that American companies are at a disadvantage because of uncertainty about the Law of the Sea Treaty, but U.S. companies can be rid of that uncertainty through an official statement that the United States completely disavows the treaty and will interpret the “common heritage of mankind” to mean that all companies from all nations will be able to access the ocean’s treasures in the Area.

The Law of the Sea Treaty is designed in the same vein as every other international foreign aid program by the same brand of bureaucrat. It will result in the same failure. And the only “common heritage of mankind” that will be noticeable at the end of the day is that “while the rich get richer, the poor get poorer.”

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Gazza said:

... Mining the oceans for minerals is nonsensical. Other than manganese-rich nodules, the deep oceanic basins are covered in a deep silty sludge many kilometres deep, overlying geologically young basaltic plains. Where exactly in this vast expanse of nothingness do you expect to find commercialy-useful concentrations of valuable minerals that cannot be mined cheaper from terrestrial sources?

September 03, 2009

Kurt W. said:

... To Gazza: "Minerals," in the case of the treaty, means anything taken from the ocean floor. There are other things potentially worth mining in the oceans besides manganese nodules, such as methane hydroxide, which could replace hydrocarbons such as gasoline, to power the world. There is more potential energy available in methane hydroxide than in all of the oil reserves on or near land. Since only a fraction of the oceans' bottoms have been explored,it is likely other valuable elements may be available, especially near underwater volcanic vents. The author

September 03, 2009

Caitlyna said:

Where the ocean minerals are, who will get them and why Other than manganese nodules, cobalt crusts and some polymetallic sulphides, ocean minerals (including oil and gas and methane hydrates) are found on the continental shelf. One of the benefits to the US is that the Convention now defines the extent of the shelf not to the shallow extent of the geological shelf (which ends at about 600 feet of depth) but to the outer edge of the continental margin, with its edge at the beginning of the deep ocean floor that is thousands of feet deep. Oil and gas, alluvial minerals (including diamonds), and most of the polymetallic sulphide deposits are on this broader shelf under coastal state control. It is worth noting that more than 25 years after President Reagan rejected the Convention because of the seabed mining provisions as they were then, the US ocean mining consortia of the 1980s have all shut down their operations. In contrast, there are 8 national mining operations operating under the International Seabed Authority, including one by Germany that has the minesite formerly registered by a US consortia. Japan, France, Germany, Russia, China, South Korea, India and a group of east European countries are exploring their mine sites. By staying outside the ISA and the Convention, the United States has killed the industry that Reagan tried to save. I am sure there are many serious problems in multilateral affairs that may actually be a threat to US interests. The LOS Convention, especially its seabed mining provisions, is not one of them.

September 03, 2009

Caitlyna said:

About those pesky transfer of technology provisions, old and new Finally, your reading of the Agreement on Part XI is just wrong. Under Reagan we opposed the mandatory transfer provisions of article 5, Annex III and we argued that ocean mining technology would be available under the open market. And if it wasn't, we offered to help find willing sellers, suppliers or service companies to help both the Enterprise and developing countries operate in the Area, because finding buyers for US goods and services is part and parcel of the normal work of the Commerce Department. I note that the general provisions on technology transfer were not included in Reagan's instructions to the delegations when he itemized the changes that were necessary for the US to sign the convention. Claiming otherwise does not change that reality.

September 03, 2009

Caitlyna said:

... One other error, and an important one, in the article: Decisions on approval of exploration and exploitation activities is the responsibility of the International Seabed Authority and not the Enterprise. In the ISA, the US, once we join, will enjoy a permanent seat on the decision-making council where we will also enjoy a veto over the adoption or amendment of rules, regulations and procedures, approval of the budget, any proposed amendments to the seabed provisions of the convention and over plans to distribute funds from revenue sharing on the deep seabed or extended continental shelf. The Enterprise has no role in the decision making of the ISA, but the ISA does have responsibility to ensure that the Enterprise follows the rules imposed by the Convention.

September 03, 2009

Flu-Bird said:

Big brother of the seas Its all about control and their going to use the threat of these pirates to try and convince us all to support LOST we dont ned any big brother UN scum we need to track down and hang those pirate like they used to do

September 03, 2009

Bonnie said:

We need to tell the UN to... GET LOST! No to the Law of the Sea Treaty. No to Kyoto. No to the World Court. Get the US out of the UN and the UN out of the US.

September 03, 2009

alan berlind said:

... Caitlyna is right on. Ronald Reagan had specific objections, all of which were met in negotiations leading to the "Agreement" of 1994. Why else would Reagan's Secretary of State George Schultz say, as he did, that his boss would have approved the treaty as amended by the Agreement?

September 04, 2009

Kurt W. said:

Response by author To caitlyna - part 1: I confess that I did not know that methane hydrates were limited to the continental shelves, but knowing that would not have changed the article since the Area, the part of the world’s oceans that would be controlled by the Authority, a UN creation, contains sections that include continental shelves (by your admission, there are valuable mineral deposits on the continental shelves). Also, your argument for the treaty makes little sense if countries, as you imply, really do control the continental shelves. If perchance all continental shelves are somehow “claimed” by the world’s countries with the blessings of the Authority, two questions arise: why would it be necessary or even desirable to have a treaty merely to control the plucking of manganese nodules from great swaths of underwater silt, and what control measures does the Authority retain over mining on the continental shelves, which are supposedly under each country’s control? The brief answer to the second part of the question is that the Authority would retain a taxing Authority on minerals mined beyond the Exclusive Economic Zones (EEZs) and that the EEZs are not all that “exclusive”; there are conditionalities and loopholes.

September 04, 2009

Kurt W. said:

author's response To caitlyna - Part 2:Also, I have read the Agreement on Part XI regarding technology transfers several times, and am confident that I am not misreading it. If I’m wrong, please explain away the damaging quotes I give in the article and explain why the Authority will be sure to read the document in a more Pollyanish light, as you obviously read it. Even if the wording in controlling documents is only slightly ambiguous, bureaucracies have a way of interpreting their powers in an expansive way, particularly over time. Additionally, you did not address my main arguments. For instance, the system is designed from top to bottom to allow corruption. And even if the Authority gets large amounts of money from mining operations, there is virtually zero chance that the money would be put to a use that U.S. citizens would find favorable. The money supposedly would go to developing countries, but the preponderance of developing countries is run by thugs. While the United States is spending hundreds of billions annually to “spread democracy,” why would we fund the governments of thugs, solidifying their holds over power? (As president, Ronald Reagan was primarily concerned about giving money to what would now be deemed terrorist groups, but terrorists are amateur oppressors as compared with dictators and hardline leftists leaders, as history so well attests.)

September 04, 2009

Kurt W. said:

author's response To caitlyna - part 3: Finally, the only reason companies wishing to do undersea exploration and mining are abandoning the United States is because we have not taken a position for or against the treaty. If we take a strong position against the treaty and refuse to be bound by it, companies could feel safe exploring the seas, using the U.S. as their base. Plus, the treaty does not grant the U.S. anything. It limits our right to explore and mine the world’s oceans. Whereas before signing the treaty, we could explore and mine most of the world’s waters at will, we could under the treaty only mine the EEZ somewhat unfettered. Exploring the rest of the world’s waters takes a by-your-leave of the Authority and a hefty payment. There are some wise navigation arrangements in the treaty, but these arrangements have become commonly accepted rules for navigation; we need not sign the treaty to enjoy their benefits. In the whole, this treaty is a disaster waiting to happen.

September 04, 2009

Caitlyna said:

... Kurt, I'll address more of your comments below, but I have something more radical to suggest. Write to the Secretary-General of the Authority and request permission to attend the next session of the ISA as an observer and talk with the people there. Underlying your comments seems to be a feeling that other countries are out to get the US and will use their positions in the Council to hurt our interests. I haven't seen that in the times I have been there as an observer and I don't think you will either. Contrary to your comments (" I wonder if two-thirds of countries in the world hate the United States?"), US participation in the ISA is not just welcomed but desired. If you attend, you will find that out in person.

September 04, 2009

Caitlyna said:

Now, on to some other points You said "Under the revised treaty, the Enterprise would still take title to the minerals after they are mined, process them, sell them, and give the company a cut." Where did you find this? Companies can sell the recovered nodules to a processor or process them, there is nothing that requires companies to turn over the recovery minerals to the Enterprise (and you tend to confuse the "Enterprise" and the "Authority" in your piece. The only thing close to your statement would be if the Enterprise and a private firm entered into a contract where the firm did them recovery in return for a cut of the sales revenues, but this would have to be a willing contract in which the technology holder believed they were getting a good deal, otherwise it wouldn't happen. And that doesn't apply to exploitation activities in the company's own mine site. You wrote: Worse, as a businessman, even if you believe that fraud is taking place at the Enterprise and that you are not being given a fair price for your minerals, there is virtually nothing you can do to remedy the situation — other than to complain to the same organization that you believe is ripping you off, or to its sister organization, “The Seabed Disputes Chamber of the International Tribunal for the Law of the Sea.” There is virtually no way for even a sovereign country to investigate fraud at the UN affiliates, let alone a company doing so. One of the rules adopted by the Authority is that it is audited on a regular basis by one of the Big 4 auditing firms. These audit reports are available to members of the Authority and are essential to the work of the Finance Committee (which the US will be a member of once we join). Companies don't have to ask that an audit be done - it is done automatically.

September 04, 2009

Caitlyna said:

... As to technology transfer, before the Authority can take action to acquire technology by anything other than a willing sale, the rules guiding its actions must be adopted in the rules, regulations and procedures of the Authority. In order for such rules to be adopted, the Council must approve them by consensus. Since the US will have a permanent seat on the Council (once we join), we can veto any rule we don't like simply by voting "no." In real terms, however, there isn't a problem anyway. The Convention lays out the ways technology transfer is to be promoted: 1) programs of technical cooperation - we do this already 2) promote favorable conditions for conclusion of agreements... under equitable and reasonable conditions - again, this is just part of the normal conditions of promoting exports (note that this is promoting conditions for conclusions, not forcing a certain outcome) 3) conferences, symposia and seminars - not only do we do this already, we gain as much as we give 4) promote exchange of scientists and experts; again, a normal part of our foreign exchange activities 5) undertake projects and promote joint ventures and other co-operation. Again, no big deal here. We basically agreed to do stuff we do already.

September 04, 2009

Caitlyna said:

... Another point, if the ISA raised technology transfer as a part of the contract for exploration or exploitation, it would not go the to seabeds dispute chamber. Instead it would go to binding commercial arbitration (a standard process for resolving business disputes unrelated to the convention's dispute resolution provisions and not related to the convention's arbitration provisions). This was included that the request of the Commerce Department and US businesses during the negotiation of the original convention.

September 04, 2009

Caitlyna said:

... ONe of the things the treaty gives, and something that industry finds essential, is international recognition of exclusive right to explore and/or exploit a minesite. That is something the US cannot give on our own. We tried to negotiate a 'reciprocating states' agreement with other seabed mining states, but those states are all members of the Convention now and won't undercut the convention by working out a deal with us. without exclusive rights, it woould be commercial malpractice for any institution to loan or invest 1 or 2 billion dollars in a deep seabed mining operation. Heck, you can't even get a $100,000 home mortgage without a title search to prove you will get clear title. You can't expect anything less to get a billion or two.

September 04, 2009

Caitlyna said:

... You wrote: The Law of the Sea Treaty is based on the idea that there is a static amount of wealth in the world and that the best way to help the poor around the world is through penalizing technologically advanced countries and forcefully redistributing wealth through benevolent leaders who have worldwide clout. In truth, the basis of the LOS Convention is the trade in which coastal state control of resources grew from 3 miles to 200, with control over the seabed extending even further while protecting freedom of navigation outside of 12 miles and, specially important, through narrow straits that would otherwise have been closed by the extension of the territorial sea from 3 miles to 12 miles. Compared to that, the minerals of the deep ocean floor is a small item. Even then, we worked out a good deal for american firms and for international business for mineral development of the deep seabed.

September 04, 2009

Caitlyna said:

... You have a large section that attacks foreign assistance programs with only a loose tie to the provisions of the Convention. Whatever funds the Authority might eventually receive will be distributed by a plan that is approved by the Council by consensus. Again, that gives the US a veto. Beyond that, I expect that most countries will push for a plan that distributes the funds among the member states rather than implement a foreign aid program. I can tell that you feel passionate in your position of foreign assistance, but your lengthy attack has little relevance to the seabed mining provisions.

September 04, 2009

Caitlyna said:

... Finally, as much as I want to have deep seabed mining take place under US flag, I equally want to cement in the favorable rules governing freedom of navigation that we worked so hard to obtain. By staying outside of the convention we lose our leverage in the interpretation of those rules and find it more difficult to bring other nations to our side. After all, our concern is maintaining our navigation rights far from our shores and close to the shores of other nations. I know the argument that we have the naval power to do what we want, and it is true that e we have the power to do anything we want, but we don't have the power to do everything we want, and every time we use force on an ally to get our way, we lose a bit of the assistance that ally could have provided in future cases. That is part of the reality that Scott Borgerson wrote about. That is why the navy and Coast Guard supported the negotiation of the convention from our first discussions with the russians in 1965, and why every living chief of naval operations and commandant of the coast guard support it.

September 04, 2009

JonathonS said:

Who are these people? It is amazing that there still remain people who have no idea what the Law of the Sea, or reality in the world, is about. Kurt W. Bonnie and the Flu-Bird are so clueless that it amazing that they could even log onto a computer to enter their comments. Perhaps a good strategy for them might be to dig a hole and bury themselves in there so that they don't have to deal with the world any longer and every else can be spared of their inane rantings.

September 06, 2009

JonathonS said:

sludge? Hey Gazza, maybe you subscribe to the ancient notion that the bottom of the sea is covered with bathybius? I believe Caitlyn has described the resources well.

September 06, 2009

Bonnie said:

Who are these people? It is amazing that there still remain people who have no idea what the Law of the Sea, or reality in the world, is about. Caitlyna and JonathonS are so clueless that it amazing that they could even log onto a computer to enter their comments. Perhaps a good strategy for them might be to dig a hole and bury themselves in there so that they don't have to deal with the world any longer and every else can be spared of their inane rantings. Guess it's a matter of perspective, isn't it.

September 06, 2009

Bonnie said:

Do some more reading http://www.thenewamerican.com/...olicy/1084 http://www.thenewamerican.com/...nu-27/1000 http://www.thenewamerican.com/...litics/801 http://www.thenewamerican.com/...litics/800 http://www.nationalcenter.org/...reaty.html http://www.cfif.org/htdocs/fre...reaty.html http://www.usasurvival.org/lost.shtml http://townhall.com/columnists...hold_water http://www.heritage.org/Resear...81104c.cfm http://jya.com/btr.htm http://www.moeagle.org/moeagle/topics/LOST.html http://www.frontpagemag.com/re...RTID=28229 http://www.ronpaulforums.com/s...?p=2282537 http://www.americaneconomicale...od_ID=2869 http://www.newsmax.com/headlin...01676.html http://www.scribd.com/doc/1156...Government http://www.aim.org/special-rep...anization/ http://www.nationalreview.com/...181156.asp

September 06, 2009

Kurt W. said:

Author responds again To Caitlyna – part 1: I didn’t say that other countries did not want the United States to be a participant in the Law of the Sea Treaty. I did imply that an underlying current of hate and jealousy are apparent in the actions of other countries. I have traveled throughout much of Europe, and this undercurrent is almost universally directed toward our government because it is seen as too powerful. Also, I’m sure that you’re correct that America is welcome to join the treaty, because not only is it likely that many of the participants at the Authority and Enterprise are likely earnest and well meaning, but without the United States, which has the largest blue-water navy in the world and deep pockets, the treaty is rather toothless and a more lackluster source of income. (Note: Many members of the UN are probably also sincere and earnest, but that doesn’t stop its operations from being cesspools of corruption and failure.) But in treaty negotiations, other countries’ representatives are sure to look after their self-interests over ours and look to bind us in Lilliputian chains. People being led by their emotions is just human nature, and backroom deals are the nature of politics.

September 09, 2009

Kurt W. said:

... Part 2: You asked how I determined that the Enterprise would take title to the minerals after they are mined. Article 170, The Enterprise, of the Law of the Sea Treaty states directly, “The Enterprise shall be the organ of the Authority which shall carry out activities in the Area directly, pursuant to article 153, paragraph 2(a), as well as the transporting, processing and marketing of minerals recovered from the Area.” The section of the treaty, as the treaty was originally configured, that would have specifically allowed exemptions to this title-taking verbiage — Annex III, Basic Conditions of Prospecting, Exploration and Exploitation, [parts of] Article 13 — no longer applies, according to the Agreement Relating to the Implementation of Part XI, and has been overridden mainly by Section 8 of the Agreement, Financial Terms of Contracts. The fact that the Authority is not presently taking possession of the minerals from companies does not negate how the treaty is worded.

September 09, 2009

Kurt W. said:

... Part 3: You believe fraud won’t happen because one of the Big Four auditing firms will be auditing operations. Let me think … can I think of why I believe these auditors won’t find any dirt on the operators? One, Bernard Madoff was audited regularly though he stole billions and he had been reported to the inspectors for false claims over the years. (Enron saw a similar scenario.) Arthur Anderson Accounting, formerly one of the biggest accounting and auditing firms, went out of business after aiding and abetting fraud. The UN Oil for Food scandal apparently went on for years, though the UN is supposed to be “transparent.” Even after the Oil for Food scandal came to light, there were no mass arrests for fraud of UN officials, and internal punishments by the UN were nearly nonexistent after the UN investigated itself.

September 09, 2009

Kurt W. said:

... Part 4: You place a lot of weight on the fact that the U.S. would have “veto” power, but it’s a rapidly dwindling crowd in the USA who would trust an Obama-administration lackey with “protecting” the interests of U.S. citizens — likewise, with the globalist administration of George W. Bush. There are no real checks and balances built into the treaty system. Even in the USA where the Constitution has built in checks and balances, political powerbrokers manipulate legal verbiage to their own advantage, ignoring definitions they don’t like in favor of ones they do like. Also, in this treaty even with veto power, there is virtually no way for the United States or any other nation or a company to prosecute fraud, as I pointed out. Also, you assume that under the treaty technology sharing will take place solely with willing sellers. Not likely, and like you say, for willing sellers the U.S. already promotes “favorable conditions for the conclusion of agreements” as “part of the normal conditions promoting exports.” This treaty is not needed to promote willing technology sharing.

September 09, 2009

Kurt W. said:

... Part 5: You say, “One of the things the treaty gives, and something the industry finds essential, is international recognition of exclusive right to explore and/or exploit a minesite.” Without it, you say, no U.S. company can get a loan to do deep seabed mining. You added that “reciprocating states” agreements were a failure. This argument would have some merit if I were promoting getting permission to mine from other countries that have signed the treaty, but I am not. I am saying that we should announce that the United States will not be subject to the treaty. Why are we asking for permission from other countries for any use of the oceans? Isn’t this just another way of saying that our government believes in the binding aspects of the treaty, but has not yet acquiesced to the treaty? Also, there is a very good chance that if the U.S. officially denounces this treaty, saying that our country will not be bound by the treaty, private equity will come forward to fund undersea mining, as there is always someplace to sell valuable metals and other minerals. When companies in other countries see that the United States will protect their right to mine for free, we would likely very quickly undo the treaty as the companies would come here.

September 09, 2009

Kurt W. said:

... Part 6: The treaty is based on the “idea that there is a static amount of wealth in the world and that the best way to help the poor around the world is through penalizing technologically advanced countries.” Nothing you have said in your response alters that fact. I challenge you to peruse the treaty and see how many times the term “developing States” shows up in conjunction with some type of special consideration. And it is highly unlikely that the developed countries of the world – who have most of the cash and the most powerful militaries – would ever allow navigation through narrow straits to be closed off.

September 09, 2009

Kurt W. said:

... Part 7: The foreign aid section of the article is relevant because it is just another way that the treaty is set up to fail and to allow corruption. And even if you personally “expect that most countries will push for a plan that distributes the funds among the member states rather than implement a foreign aid program,” the money for disbursement is still be taken from Americans and American companies and would go to hardline leftist leaders and dictators who should never get a penny of money to aid their survival. Of course, the treaty and its entities, like all UN affiliates, see no redeeming qualities in one type of government over another, even though I cannot think of any instance in the history of mankind where the centralization of power in a small group or entity led to a wonderful outcome for the common man in the long run.

September 09, 2009

Kurt W. said:

... Part 8: You claim that the United States needs to pass this treaty so that we don’t lose the assistance of our allies, because, essentially, we don’t want to be forced to use the largest, most powerful navy in the world to safeguard our freedom of navigation. Really? You are talking about the United States here, correct? About the country that instigates unpopular wars? About the country whose single-minded spending of money greatly exacerbated the world’s financial crisis? About the country that sets up foreign aid programs designed to lead poor countries into massive debt so that we can use that debt as leverage to force them to abide by our wishes? Also, if we’re looking at the military for its stamp of approval and expertise, we should mention some facts that should be real deal breakers in the treaty that your experts just ignore: there is to be no scientific study of the oceans for other than peaceful purposes, and we cannot build defense installations in the waters around our country, even in our EEZs (the concern of the people you cite seems shortsighted).

September 09, 2009

Kurt W. said:

... Part 9: I’d like to thank you, Caitlyn, for instigating this dialogue, but you are obviously worshipful over the treaty and can see no dangers in it, and I can see little long-term good for Americans from this treaty, mainly a lot of bad. And I believe that any of the treaty’s positives can be achieved in other ways. For instance, when researching this piece, I was curious to note that even though the treaty has been in place since 1994, world fish stocks are declining, not increasing, and any positives seen in helping the fish stocks to recover have come about because of U.S. participation in a separate treaty, not the Law of the Sea Treaty. I see the Law of the Sea Treaty as very dangerous, and I hope that more people agree with me than you. Unfortunately, it is unlikely I will have time to continue this dialogue. It is to be hoped that people will read this treaty and will make up their own minds – before the treaty is voted on in the Senate.

September 09, 2009

Caitlyna said:

... The LOS Convention sets up only three organizations, and those now have ten to fifteen years of history in operation. You can gather together all your hypotheses of what might go wrong, but in the fifteen years since the Convention came into force, the International Seabed Authority has operated exactly as we wanted it to, the International Tribunal on the Law of the Sea has addressed cases submitted by the parties and stayed well within the expectations we had for that body, and the Commission on the Limits of the Continental Shelf has been quietly doing its job of reviewing the scientific basis for claims to the shelf beyond 200NM, recommending international acceptance of some and sending other back for more work. Meanwhile, our domestic deep seabed mining industry has died and components moved to other nations, depriving us of a domestically controlled source of critical and strategic minerals that was of first priority to president Reagan. There comes a point where you just need to stop creating hypothetical cases of what might go wrong and look at the evidence. We have lost, for as long as we are a non-party, the deep seabed minerals industry; we have reduced our influence in the regional and global organizations that guide the implementation of the Convention, including the rules that address our rights in foreign EEZs, we have made it more difficult to gain foreign participation in security agreements such as the proliferation security initiative; and in the longer term we have left it to parties to the Convention to guide the adaptation of the law of the sea to future issues and conditions.

September 10, 2009

Caitlyna said:

... Kurt, what are you talking about when you say " there is to be no scientific study of the oceans for other than peaceful purposes"? "Peaceful purposes" has a very wide definition that includes research for national defense. It sounds like we differ in the degree to which we trust and respect the leaders of our sea services so I expect that simply reporting that the heads of naval research and the oceanographer of the navy all have supported the Convention, in addition to all of the chiefs of naval operations, won't sway you, but I take seriously their recommendations to support the convention.

September 10, 2009

Caitlyna said:

... Bonnie, I have read almost all of those links already, but if you want to make a convincing argument you have to put your points in your own words as Kurt has done. I could provide you with many more links from the people who actually use the oceans that support US accession to the Convention, but I don't that would be any more helpful than your list f URLs.

September 10, 2009

Caitlyna said:

... Kurt, you said: "Also, there is a very good chance that if the U.S. officially denounces this treaty, saying that our country will not be bound by the treaty, private equity will come forward to fund undersea mining, as there is always someplace to sell valuable metals and other minerals. When companies in other countries see that the United States will protect their right to mine for free, we would likely very quickly undo the treaty as the companies would come here." Alas, that is wishful thinking of the worst order. Short of the US government providing some form of "investment insurance," lenders will not put money into deep seabed mining outside the Convention. We know this from consultations held with bankers and investors conducted during the Reagan Administration. It was felt that an alternative regime would have to have all of the seabed mining nations as parties before banks or private investors would put up the billion or two dollars needed to build a single ocean mining system. Reagan negotiated such an agreement, but once those nations joined the convention after the 1994 Agreement came into force, the agreement ended and the US seabed mining industry industry became a dead man walking. In fact, the US does not have the technology for processing the nodules that our former consortia members provided - technology and experience is held by Canada, Australia, France and other nations, all party to the convention and all respecting the provisions that allow seabed mining only in accordance with the Convention. It is time to be honest and say that opponents to the Convention are willing to sacrifice Ronald Reagan's vision of an American critical and strategic minerals industry based on seabed mining in order to avoid participating in the LOS Convention. That is a direct outcome of non-participation that needs to be clearly accepted by convention opponents.

September 10, 2009

Pete said:

A case for playing it safe. #1 Though it is likely that Catelyna is correct and that the Authority is not now a sinkhole of corruption and is not using the powers vested in it by the Law of the Sea Treaty to their fullest extent, it is likely that the Authority exists only as a rather benign agency because both it and underwater mining are still in their infancy. Fifteen years old for a government agency is not very old for a political entity. If undersea mining ever becomes a major industry, chock full of competitors, the Authority will have then wealth and the size and the power ripe for abuse. We must remember that when the U.S. created the Federal Reserve, a central bank in charge of our country’s money supply, its critics warned of ways that it would be abused to enrich the super-wealthy at the expense of the poor and that it would cause inflation, draining the wealth of the poor and middle class. It did just that. Critics also warned that if we went off the gold standard, so much malinvestment would happen in credit markets that we would risk financial insolvency. That is now happening too, less than 40 years after we went off the gold standard. They also warned that government would grow huge through printing money. That has happened too.

September 17, 2009

Pete said:

A case for playing it safe. #2 When an entity is designed for abuse to take place, the abuse will almost always take place. Like Kurt W. said, just look at every dictatorship in the world for confirmation. We know this treaty is designed poorly, so if we remember that nothing in politics happens by accident, we stay out of this treaty. Also, backing up Kurt W., I must agree that military leaders can be very shortsighted. Since the formation of NATO, the United States has been giving out war guarantees to countries around the world, saying we will go to war for them if they are attacked, even though that is how WWII started. Britain promised Poland that it would go to war if Poland were attacked. When Germany invaded Poland, Britain declared war. Ironically, in the end, we gave Poland to the Soviets anyway. Now the U.S. insists on giving war guarantees to even unstable little countries like Georgia. If any country is attacked, we must fight for them, or show the world that our word means nothing. Some policy!

September 17, 2009