So Don Rumsfeld testified against ratifying the Law of the Sea Treaty. This is a key point:
Rumsfeld called “an idea of enormous consequence” the fact that “anyone who finds a way to make use of such riches by applying their labor or their technology or their risk-taking are required to pay writ royalties of unknown amounts, potentially billions, possibly even tens of billions over an extended period, an ill-defined period of time, to the new International Seabed Authority for distribution to less developed countries.”
Saying that this principle has “no clear limits,” he mused that it could set a precedent for space exploration, too.
He shouldn’t just “muse.” It could be a disastrous precedent, completely undercutting the arguments we make against the Moon Treaty.
The guiding principle behind LOST and the Moon Treaty seems to be that obtaining a resource from the sea or space is like finding a treasure chest. It’s only fair to distribute the treasures in the chest to everyone since the firm just happened to get to it first. That’s really a misunderstanding of the basic economics of what happens with such endeavors.
A company must take on enormous investment risks to obtain a resource from the seabed or space. If they are successful, they will make a profit. But they will also increase the supply of that resource and thereby lower the price (or keep the price from rising as demand rises) of that resource. That is, in fact, the equivalent of giving everyone, including those in developing countries, a new subsidy to buy that resource.
So if one really wants to help everyone, the goal should be to do everything possible to encourage firms to develop those resources as soon and as efficiently as possible. That gets those implicit subsidies distributed as soon as possible. A UN royalty only burdens and discourages such endeavors and keeps the prices of those resources higher, i.e. makes everyone poorer, than they otherwise would be.
“The guiding principle behind LOST and the Moon Treaty seems to be that obtaining a resource from the sea or space is like finding a treasure chest. “
The guiding principle behind LOST and the Moon Treaty is that no one from the lower class, or the middle class, or any Third World Nation – or even any -Second- World Nation would ever do anything like this. So the only possible people we’re taxing here is rich, white, Americans. Or a company, and therefore a proven despoiler. What’s not to love? (Oh, and if you’re -not- American, we’ll probably accept some graft to let you slide, as usual.)
Think Kyoto. Where Russia signed just to make the treaty ‘binding’ on Europe, where Russia said basically -at- the signing ceremony: “Of course, we aren’t going to do one single thing this treaty demands of us other than complain when we see you violate one of -your- terms.”
Any vaguely plausible economic theory is just window dressing.
Govt. has exactly one purpose; anything outside of that purpose has a negative impact on everybody. That one purpose is collective self defense. That’s it.
Everything else they get involved with negatively impacts lives. Every. Single. Thing. Why? Because they interfere with open competition which is the only force for good.
Consumers are the best regulators. Visibility is the best policy. The media is failing at that job.
Clark is exactly right that lowering prices distributes the wealth. Competition without government interference lowers prices fastest. Ownership avoids any tragedy of the commons.
We should all know this in our bones by the third grade.
As I posted over there:
“She said what this treaty proposes is nothing less than the international nationalization of roughly two-thirds of the earth’s surface,” he said. “The major idea underlying the Law of the Sea Treaty is that the richest of the oceans, beyond national boundaries, are the common heritage of mankind. And thus supposedly owned by all people. Actually, it means they’re un-owned.”
When something is owned by everyone, it’s owned by no one. See: Tragedy of the Commons.
Rumsfeld called “an idea of enormous consequence” the fact that “anyone who finds a way to make use of such riches by applying their labor or their technology or their risk-taking are required to pay writ royalties of unknown amounts, potentially billions, possibly even tens of billions over an extended period, an ill-defined period of time, to the new International Seabed Authority for distribution to less developed countries.”
Similar language exists the the stillborn “Moon Treaty”. It says that someone can spend billions developing a technology and if it’s profitable, they have to pay everyone else. This brings to mind the line from the Lincoln Douglas debate:
It is the eternal struggle between these two principles — right and wrong — throughout the world. They are the two principles that have stood face to face from the beginning of time; and will ever continue to struggle. The one is the common right of humanity and the other the divine right of kings. It is the same principle in whatever shape it develops itself. It is the same spirit that says ‘You toil and work and earn bread and I’ll eat it.’ No matter in what shape it comes, whether from the mouth of a king who seeks to bestride the people of his own nation and live by the fruit of their labor, or from one race of men as an apology for enslaving another race, it is the same tyrannical principle.’
Lincoln was talking about slavery and tyranny but it applies here as well. Throw in the massively corrupt UN running things and supporting this treaty becomes very difficult.