September 26, 1986

September 26, 1986 | Backgrounder on International Organizations

The Legal Case for Cutting U.S. Funding for the United Nations

(Archived document, may contain errors)

536 September 26, 1986 THE LEGAL CASE FOR'CUTTING US. FUNDING FOR THE UNITED NATIONS INTRODUCTION The United States at last has found a way to get the United Nations' attention: Congress is threatening to cut as much as 148 million from the U.S. contribution to that organization. The reason for the congressional hardline is the U.N.Is well-documented record of irresponsibility. The congressional message is clear: Unless the U.N. reforms substantially, it can expect only decreasing levels of U.S support.

The problems plaguing the U.N. have not emerged suddenly A quarter century ago, Benjamin Cohen, a distinguished legal scholar and delegate to the 1944 Dumbarton Oaks Conference, wh ich laid the groundwork for the United Nations, warned Small and relatively weak states may influence the action of the more powerful states, but they cannot use their voting strength in the General Assembly to dictate.

The irresponsible exercise of votin g power by the small and relatively weak states may.threaten the future of the United Nations quite as much as the irresponsible exercise of the veto or the irresponsible withholding of contributions by the Great Powers 1. Benjamin Cohen, The Un ited Nati ons: Const itutional Develooments. Growth and Possibilitieg (Cambridge, Massachusetts: Harvard University Press, 196 I), p. 94.

I Indeed, it has been the more than 100 Ilsmall and relatively weak states," represented by the so-called Nonaligned Movement, w hich over the past fifteen years have used their overwhelming numerical majority in the General Assembly to exercise near-total control over the U.N.Is agenda, deliberations, and resolutions. They have made the U.N. the willing servant of a radical Third World ideology, which is obliquely pro-Soviet in its political views, emphatically redistributionist in its economic views, and profoundly hostile to the liberal democratic values of the U.N. founders.

Perhaps the most revealing example of the U.N. majority's Iirresponsible exercise of voting powerll is in budgetary matters. The nonaligned nations, many of whom pay only 0.01 percent of the U.N budget, use their voting strength to approve ever expanding U.N budgets and ever more programs, committees, and conferences, which generally accomplish very little and thus seriously damage the U.N.Is reputation approximately 4 billion spent by the U.N. bodies, the U.S. provides about 1.1 billion-some 25 percent.

U .N. budgetary growth. Yet U.S. concerns, shared by other major donors, have been largely ignored series of laws reducing U.S. contributions to the U.N predictably is being criticized by those who are determined to maintain the status quo at the U.N. They a ccuse the U.S., for example, of precipitating a Ilfinancial crisisll at the U.N., even though other nations, chiefly the Soviet Union, have withheld larger sums from the U.N. and U.N. officials admit that there is ample scope for saving money and rational i zing U.N. activities. Reflexive U.N. backers, such as Elliott Richardson, Chairman of the United Nations Association of the U.S., also complain that Congress has no right unilaterally to reduce U.S. contributions to the U.N .and that so doing would Vhrow o ur legal commitments to the winds.Ili Such criticisms stand on shaky legal grounds. There is serious doubt whether the U.S., as a signatory of the U.N. Charter, is obliged to contribute whatever amount is llassessedll by the General Assembly--particularly as these assessments have been ignored by other countries in the past, which constitutes what jurists call a Itmaterial breach" of the Charter that changes the nature of the U.S. I obligations. It is also unclear whether a strictly legal perspective is fu l ly compellhg, given the highly political process of financing the U.N. and that many U.N. activities are financed by voluntary The Unitea States is the U.N.Is biggest financial backer. Of the Washington continually protests In response to U.N. profligacy, the U.S. Congress has enacted a This action 5 I I 2. E. L. Richardson and Skirting the Law," Op-Ed, The Washinnton Post, May 20 1986 2 contributions. These considerations have been ignored by those condemning the actions of the U.S. Congress.

In the legal and historical context of U.S. membership in the U.N., the U.S. has a right to reduce its enormous financial contribution to the organization. In mandating such a reduction, not only is Congress making legally allowed policy, it is making sound policy.

U S WITHHOLDINGS Every two years, the U.N. and its specialized agencies adopt budgets, which are largely financed by levying fixed assessments on all U.N. members: The budget of the U.N. in New York is roughly $1.68 billion for 198601987, of which the Unit e d States is assessed 25 percent, or $420 million. The budgets of U.N. agencies operating elsewhere total about $7 billion over two years,'of which the U.S also contributes in the aggregate 25 percent. The assessed contribution is supplemented by large vol untary contributions from the U.S. to U.N. economic development and humanitarian affairs programs such as UNICEF and the United Nations Development Program.

Recently enacted U.S. laws affecting U.S. withholding from the assessed contribution are those that 1) withhold money to protest specific U.N. activities 2) withhold money as part of a U.S. federal deficit reduction effort: and 3) mandate across-the-board withholdings unless the U.N. changes its budget process and shows greater fiscal responsibility.

The first type of withholding involves reductions based on the principle that certain U.N. activities are what legal scholars call.

Example: the U.S. for years has reduced its assessed contribution by the amount the U.N. spends in support of the.Palestine Liberation Organization. ultra vires, or outside the authority, of proper U.N. actions.

The second type is intended to help the federal government qomply with the deficit ceilings set by the Gramm-Rudman-Hollings legisla tion. Such cuts are only indirectl y aimed at the U.N. and have been applied selectively; some U.N. agencies have been reduced more than others.

The third type is the most significant, involving not only large reductions in U.S. contributions, but also making resumption of that full paymen t contingent on concrete changes in U.N. practice. The Kassebaum-Solomon Amendment of'1985 introduced by Kansas Republican Senator Nancy Kassebaum and' New York Republican Congressman Gerald Solomon, states that "No payment may be made for an assessed con t ribution to the United Nations or its specialized agencies in 3excess of 20 percent of the total annual budget of the United Nations or its. specialized agencies (respectively) for the United States Fiscal Year 1987 and following years" unless the U.N. gr a nts voting rights llproportionate to the contribution of each such member state to the budget of the United Nations ang its specialized agenciest1 on Ilmatters of budgetary consequence.Il Stated simply, this means that if.the U.S. pays 25 percent of the U .N. budget, it should have proportionate say (perhaps as much as 25 percent) on budgetary matters. Currently, every U.N. member casts one vote, except the Soviet Union which casts three.

The'U.N. has not implemented the proportionate voting required by the Kassebaum-Solomon Amendment. Until it does so, Congress,will withhold $79 million from its assessed contribution.

The legislative record of the Amendment makes it clear that its intent is Into foster greater financial responsibility in preparation of the budgets of the United Nations and its specialized agen~ies not to reduce the share paid by the U.S. And although the Amendment calls for voting rights Itproportionate to the contribution of each such member state to the budget of the United Nat'ions,Il M embers of Congress and Reagan Administration officials have indicated that measures short of the adoption of a rigid system of weighted voting could satisfy the intent.

Assistant Attorney General Allan Gerson: "The Kassebaum Amendment, if you read it caref ully, calls for on budgetary matters. That leaves a lot to be negotiated.lI' It seems, for example, that Congress could be satisfied by a change in the rules of procedure of the U.N. Fifth Committee, which deals with the budget, so that th e Committee would operate by consensus Explained Deputy Such steps would not necessarily conflict with Article 18 of the U.N. Charter, which establishes the principle of one-nation, one-vote in the General Assembly.

Amendment, vitiate the principle of Vhe. sovereign equality of states on which the U.N. Charter is based, or deprive any member state of its voice on budgetary issues Nor would the change require a Charter 3. Section 143, Public Law 99-93 (99 Stat 424 4. Ibid 5. Ibi'd 6. Statement of Allan Gerso n , Deputy Assistant Attorney General, at the public hearing Financial Crisis of the United Nations: International Law and United States Withholding of Payments from International Organizations", June 12, 1986 I i 4- U.S I 1 5 I WITHHOLDINGS AND UoSm CONSTI T UTIONAL DOCTRINE I I Article VI of the U.S. Constitution states that ll...all Treaties made...under the Authority of the United States, shall be the supreme Law of the Land." This phrase, known as the Supremacy Clause, makes international treaty obligatio ns binding under domestic law. Since the UmN. Charter is consiaered a treaty and was ratified by ,the Senate, it is the law of the land.

Charter, in this case Article 17(2), which states that "The ,expenses of the Organization shall be borne by the Members,as apportioned by the General Assembly,Il could be considered a violation not only of international law, but also of domestic law Viola t ion of the terms of the Such an interpretation, however, would be incorrect. It is well-established U.S. constitutional doctrine, flowing originally common law principles, that obligations incurred through internati instruments can be affected by subseque n t domestic law. This was reaffirmed in principle in the 1957 case of Reid v Covert and in 1973 in Dims v. Shultz from onal In Reid v. Covert, Justice Hugo Black, writing for the'court reiterated in the strongest terms that, since international *treaties a r e coequal with Acts of Congress, subsequent Acts of Congress may modify or even abrogate preexisting international obligations. Wrote Black The Court has also repeatedly taken the position that an Act of Congress, which must comply with the Constitution i s in full parity with a.treaty, and that when a statute which is subsequent in time is inconsistent with a treaty the sgatute to the extent of conflict renders the treaty 7 null Since the legislation effecting the withholdings is sdsequent in time to the U .S. accession to the U.N. Charter, that legislation, of course, has legal precedence over the supposedly conflicting Article of the Charter.

U.S. courts also have recognized that congressional sovereignty over U.S. international obligations extends to the U.N. Dims v. Shultz, a number of prominent citizens sued then Secretary of the Treasury George Shultz to force Treasury to abide by a U.N.

Security Council resolution embargoing all trade with Southern Rhodesia, despite the fact that Congress had passed l egislation that effectively mandated the President to buy strategic minerals from that country In the case of Ruling on the case, Judge Carl McGowan of the U.S. Court of 7. Reid v. Covert 354 US '1, L ed. 2d 1146, 77 S Ct. 1222 1957 5-r I I Appeals, Distr i ct of'Columbia Circuit, strongly upheld the right of Congress to abrogate any aspect of the treaty obligation resulting from U.S. participation in the U.N. Wrote McGowan Under our constitutional scheme, Congress can denounce treaties if it sees fit to do so, and there if nothing the other branches of government can do about it.

The meaning of the various court rulings: Congressionally mandated cuts in the U.S. contribution to the U.N. are entirely constitutional under domestic law.

THE UNITED NATIONS BUDG ET AND INTERNATIONAL LAW I I Member states have battled since the founding over the Despite this 41 years of proper method of financing the organization discussion and dispute, it has not been established convincingly that any nation has an absolut e obligation under international law to pay an assessed contribution to the United Nations. Article 17(2) of the I United Nations Charter states that "The expenses of the Organization shall be borne by the Members as apportioned by the General Assembly.11 W hile the record makes it clear ghat the Article was intended as a statement of binding obligation, the experience during its first fifteen years made it more clear that#the llobligation'to payt1 assessed contributions wasac, in fact, almost entirel y theoretical. By 1962, writes Brookings Institution scholar J. G. Stoessinger, over one-third of the member states of the United Nations regu'larly defaulted in part or in full on their assessments most of the Latin American countries, regarded each Assem bly resolution solely as a recommendation, not as a legal obhigation. They posed the problem of legal I principle.

Other states, namely the Soviet bloc and Arab countries, have objected to paying for virtually any U.N. activity in the area of peace and sec urity, claiming that those llresponsible" for conflicts 8. Diaes v. Shultz, 470 F. 2d 461 (D.C. Cir. 1972), cert. denied, 41 1 U.S. 931 (1973 p. 4

66. McGowan also reaffirmed the principle that a subsequent statute only renders the treaty null "to the ext ent of conflict U.S. violation of a Security Council resolution therefore, does not necessitate U.S. withdrawal from the U.N 9. See,'for example, 8 U.N.C.I.O. 487 1945 I 10. J. G. Stoessinger Financing the United Nations System" (Washington, D.C The Brook i ngs Institution, 1964 p. 110 6should cover the cost. Stoessinger continues explaining and the Soviet,bloc and the Arab countries, by stressing that the aggressors must pay,! raised the problem.of legal obligation under the charter in its starkest .form d1 In 1962, a World Court decision effectively held that virtually any expense authorized by the General Assembly was automatically legally binding equivalent to international law. Indeed, after the opinion was rendered, countries continued-and continued-to w ithhold contributions to the U.N The Soviet bloc and France, for instance simply refused to abide by the Courtls decision as it affected assessments to pay for two U.N. peacekeeping operations. At one point, in fact 66 states were in arrears on their cont ributions to these operations, arrearages that were only partially defrayed by voluntary contributions from the U.S. and a few other states.

Though Article 19 of the U.N. Charter withdraws from a nation its right to vote in the General Assembly if it is se riously in arrears the General Assembly has often refused to apply this sanction and did not apply it to the Soviet Union or France, even after the World Court decision. They remain Ildelinquent the Soviet bloc and France. Former heads of the Nonaligned M o vement Cuba and India, as well as the current head, Zimbabwe, have withheld parts of their U.N. contribution; other major nonaligned states that have withhe1dmoney include Algeria and Syria. China, too, has withheld funds without being subjected to sancti o ns. In fact, as of March, twenty member states were in arrears on their U.N. payments because of withholding contributions is a longstanding and near universal practice since the founding of the U.N Yet World Court opinions are not widely accepted as The p ractice of withholding assessments has not been confined to The reality is that withholding assessed U.N This is relevant because international law, as distinct from domestic law, recognizes the concept of #state practice--that the behavior of states part y to a treaty can affect subsequent interpretation of the treaty. The repeated violation of a domestic statute, for example, does not change its character. In international law, however, where the contracting parties are often states not subject to a supra n ational authority, the which states interpret obligations can and frequently does modify the original terms of agreement. Writes legal scholar Louis Henkin The society of nations has no effective law-making body or process.. General law depends o n consensus: old law 11. Ibid 7cannot survive if enough stases, or a few powerful and influential ones, reject it I Clearly, "state practice has shown that there is not even the minimum degree of consensus about financing the U.N. required to create a cle a r legal obligation. Politically motivated withholdings of contributions are and will continue to be commonplace in a near universal organization derogation of a state's financial responsibilities, it confirms that the legal obligation to pay is not absolu t e and mandatory under all circumstances impose Article 19's sanctions on France and the Soviet Union strengthens this interpretation. This "lack of sanctions,Il especially in the unusual case where such sanctions are explicitly authorized and enforceable, supports the view that the General Assembly itself has validated the right of nations to withhold contributions It was precisely this lack of sanctions that led the U.S. to promulgate what is known as the "Goldberg ReserVation.It1' In a 1965 speech at the U.N., Ambassador Arthur Goldberg announced, with the approval of Congress, that the U.S. reserves the right to withhold contributions selectively, since other nations have been doing so without suffering sanctions Although this fact may not justify total S imilarly, the fact that the General Assembly in 1964 failed to I Said Golaerg to the.U.N if any member can insist on making an exception to the principle of collective financial responsibility with respect to certain activities of the organization, the Un i ted States reserves the same option to make exceptions to the principles of collective financial responsibility if, in our view, strong and compelling reasons exist for doing so. There can be no double standard among the members of the organization Even t h e Vienna Convention on the Law of Treaties, the 1969 Treaty establishing the nature and boundaries of treaty obligations defines circkstances whereby %aterial breach" of a treaty obligation may be invoked by a nation to justify its.own decision not to ful f ill some obligation. Thus when a number of member states over a number of 12. L. J. Henkin Is it Law or Politics" in C. W. Kegley, Jr. and E. R. Wittkopf, eds The Global APenda: Issues and Persnectives (New York Random House, 1984 p. 181 13. For discussio n of the legal basis of the Reservation, see- the statement of Allan Genson; gn. cit 14. "United States Participation in the United Nations," Report by the President [Lyndon B. Johnson] to Congress, 1965, p. 108. r 8years withheld.their contributions e U.N., they %aterially breached" their obligation to the organization. Under general legal practice, this is a fundamental breach, which Inradically changes the position of every party.Il" The meaning: As stated in the Goldberg Reservation, the breach by o ther states gives the U.S. the reciprocal right to withhold if Instrong and compelling reasons exist for doing so I The changed nature of the financial obligation to the U.N. has been recognized by legal scholars as well. Jorge Castaneda, a Mexican diplom a t and legal scholar, summarizing the 1962 World Court decision states that Inone can justly ask whether the Assembly still supports in fact, the thesis of mandatory apportionment of expenses originating in recommendations.Igl6 Thomas Franck, a professor a t New York University and former U.N. official, has likewise argued that Although the International Court in 1962 opined that there was a legal obligation to pay, the norm fell into desuetude once the Assembly refused to discipIine the defaulting Soviets I t may fairly be concluded that the theoretical 'oblic&ation to pay' died on the floor of the Assembly in 1965.

Although Franck views some specific U.S. withholdings as unjustifiable, he clearly recognizes that the nature of a multilateral obligation may be changed through contrary state practice I VOTING POWER AND FINANCIAL RESPONSIBILITY The Kassebaum-Solomon Amendment and similar congressional acts which effect the largest part of U.S. funding reductions, are intended to eliminate a basic structural disj unction within the Organization.

By calling for some form of weighted voting.on budgetary matters, they attempt to alter the peculiar situation at the U.N., by which nations that pay the bills lack the votes to set budget levels, while those that have the votes to set the levels do not pay the bills 1 Currently, the contributions of just fifteen of the 159 members-the U.S., the USSR, Japan, and the twelve European,Community 15. Articles 60(2) and 60(3 Vienna Convention on the Law of Treaties 16 J. G . Castaneda, LeEal Effects of United Nations Resolutions (New York and London:.

Columbia University Press, 1969 p. 48 17. T. M. Franck, National Avainst Nation: What HaDDened to the U.N. Dream and'What the U.S. Can Do.About It New York: Oxford University P ress, 1985 p. 289 9nations-account for close to 80 percent of the U.N budget. contrast,,80 countries, a majority in the General Assembly, together contribute less than 1 percent of the budget. The Insmall and relatively weak states," therefore, have no in c entive to economize and thus authorize virtually any expenditure they deem suitable consequences for the U.N was recognized by the earliest U.N scholars. Perhaps the most eloquent elaboration of this appears in the very 1962 World Court decision that is s o frequently cited as evidence that all nations are obliged automatically to pay all U.N assessments By I I The fact that such a situation could develop, with damaging In a separate concurring opinion, Judge Sir Gerald Fitzmaurice of i Great Britain explai n ed that, since so many essential U.N. activities I are funded voluntarily and since there is no conceptual division between activities financed Woluntarily" and those financed by assessments, the reality envisaged under Article 1?(2)--fair sharing of all e xpenses-is vitiated More important, perhaps, Fitzmaurice argued that a U.N. expense is not necessarily legitimate simply'because the General Assembly authorizes it. If this were the case, he reasoned, a potentially dangerous situation could arise I for if the Assembly had the power automatically to validate any expenditure this would mean that, merely by almost anything, even something wholly outside its functigns, or maybe those of the Organization as a whole deciding to spend money the Assembly could, in practice, do He added, in a point very relevant to Congress mandating a reduction in U.S. donations to the U.N that: it would follow that, in theory at..least, the Assembly could vote enormous expenditures, and thereby place a heavy financial burden even on dissenting States, and as a matter of obligation even in the case of non-essential activities.

Fitzmaurice's .analysis of this issue and his qualms about interpreting all assessments-as lvlegitimatelv and legally binding were I prescient. From 1972 to 1 982, the U.N regular Ilassessed" budget I 18 Certain Expenses of the United Nations (Article 71, Paragraph 2 of the Charter Advisory Opinion, 1.C.J Reports, 1962, p. 201 19. Ibid, p. 214 10 increased by over 700 percent-from roughly $220 million to $1.5 b i llion: the smaller states mandating these increases also tacked on over $172 million in budget Iladd-onsll between 1983 and 1986 alone-including the notorious $73 million for'a U.N. Ilconference center" in Ethiopia, approved last year as the nation was re e ling from a devastating famine growth. In 1974, to take one example, the U.S. Wigorously opposed112o a series of large-scale salary increases for U. N. officials to no effect; by 1981, the U.S. representative in the Fifth Committee was protesting "imprope r expensest1 in the U.N. budget and stating that "We will...neither condone nor excuse waste, excess, and disregard for the mounting financial burdens imposed upon the taxpayers of the world by self-serving public institutions. IrZ1 This harsh analysis of t he U.N. budget process is shared by other member states. Since 1979, those contributors accounting for close to 80 percent of the U.N. budget have either abstained or voted against it, while in 1985 both the U.S. and the USSR voted against the budget reso l ution requiring the U.N. to make a serious effort to put its affairs in order and staunch its profligacy decade-long budgetary spree, U.S. withholdings are not only legitimate but necessary steps if the U.N. is going, in the words of the London Economist, llto avert the real threat to its existence--obesity.l The U.S. consistently opposed such unrestricted budgetary The Kassebaum-Solomon Amendment is an appropriate means of In the context of the U.N.Is CONCLUSION The 41st regular session of the United Nati o ns General Assembly convened last week. At this session, the U.S can expect to be accused of violating international law because it is withholding some of its contributions: the U.S. may even hear that it is attempting to sabotage the U.N. It makes no dif ference that, even with all the cuts in contributions proposed by Congress, the U.S. still would be giving hundreds of millions of dollars to the U.N forcefully.

At the U.N., the U.S. delegation should rebut these charges The U.S. should point to the long history of U.N. members 20 United States Participation in 'the United Nations," Report of the President [Gerald Ford to Congress, 1974, p. 415 21 United States Participation in the United Nations," Report of the President [Ronald Reagan] to Congress, 1981 , p 342 11 I I I withholding their contributions and to the fact that the entire potential U.N. deficit would disappear if the Soviet Union fully paid its arrearages.

There is more than adequate precedent to make the case thatthere is no absolute legal obligation to pay U.N. assessments. The U.S. can base its argument on solid principle; it need not plead that it is withholding funds because of congressional concern ab out the U.S budget deficit. Nor should the U.S. invoke its domestic law as a defense of the withholdings.

The3J.S. delegation,should insist repeatedly that the U.N withholding and fiscal problems never would have arisen if the U.N had paid attention to leg itimate U.S. complaints about the runaway U.N. budgets. As such, the U.S. should push for the speedy execution of fundamental U.N. structural reforms-the only real solution to the U.N.s financial crisis For overfour decades, the U.S. has given itsmora1, p olitical and financial support to the U.N. with virtually no questions asked.

During each past crisis, it was the U.S. and its Western allies that contributed the effort and, often, the money to enable the U.N. to survive, just as it is these countries tha t have created and sustained mostof the U.N.s voluntary programs. The question to be answered at the 41st General Assembly is whether the nations of the Nonaligned Movement have similar respect and affection for the organization they now control organizat ion in a way that will allow the.U.S to resume its full contributions to the U.N If they do;they will take the steps to reform the Thomas E. L. Dewey Policy Analyst 12

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