Tampa Prep 2009-2010 Impact Defense File
AT: NATO 1. NATO no longer key
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- 2. NATO is dead—EU, lack of purpose and internal disagreements
- Ext 1 – NATO Not Key
- AT: Natural Gas Price Spikes
AT: NATO1. NATO no longer key.John R. Schmidt is the senior analyst for Europe in the Bureau of Intelligence and Research at the Department of State, served as director of the NATO office at the State Department and as director for NATO affairs at the National Security Council, “Last Alliance Standing? NATO after 9/11,” Washington Quarterly, Winter, 2007 The real problem is that the United States does not really know what it wants from NATO. It continues to perceive the alliance through what is essentially a Cold War prism, as the key mechanism through which the United States attempts to project influence in Europe. The successes of the NATO enlargement process, which addressed genuine security concerns among newly freed former Communist states, and of NATO involvement in the Balkans have only helped to sustain this perception. Current U.S. efforts to give NATO a more global reach also reflect the same perception of NATO preeminence, with the alliance moving out from its European core to embrace the wider world. It is undeniably a grand vision, but it is also clearly at odds with reality. The notion of giving pride of place to a military alliance made sense during the Cold War, but it does not make sense today when the most critical threats are more varied and diffuse. NATO is of limited use as a diplomatic actor, which is why the United States has never really used it in this capacity. Other vehicles and partners are preferred for U.S. diplomatic activity, the EU increasingly among them, and this is unlikely to change. Even in the military sphere, NATO is no longer the primary instrument of choice and has at best only a circumscribed, if still important, role to play. 2. NATO is dead—EU, lack of purpose and internal disagreementsHarlan Ullman, a senior associate with the Center for Strategic and International Studies, 10/31/2007. “Winning in Afghanistan,” Washington Times, http://www.washingtontimes.com/article/20071031/EDITORIAL/110310006/1013/EDITORIAL. Brussels -- The North Atlantic Treaty Organization (NATO) has been the most successful military alliance in history. But NATO is confronting massive challenges today, in many ways more perplexing and explosive than during the Cold War, when its existence was credibly justified to its publics by the threat of the Soviet Union. The Soviet Union disintegrated long ago. And new threats and dangers to the alliance and its cohesion are neither state actors nor confined to Europe, NATO's traditional area of responsibility. NATO has bet its future on succeeding in Afghanistan, where, for the first time ever, the alliance is fighting a land war. The European Union has eclipsed NATO as the pre-eminent European structure in European political, social and economic integration. NATO suffers from inter-alliance strains, such as with Turkey and America's global war on terror and intra-alliance tensions over enlargement of member states and missile defense that antagonize Russia. And it must resolve the most profound and testing dilemma of all — maintaining a strong, cohesive military alliance long after the military threat that created it has imploded. Ext #1 – NATO Not KeyNATO doesn’t matter—EU fills in.Barbara Conry, foreign policy analyst at the Cato Institute, 9/18/1995. “The Western European Union As NATO's Successor,” CATO Policy Analysis no. 239, http://www.cato.org/pubs/pas/pa-239.html. It is inaccurate to suggest, as NATO partisans often do, that the only alternative to Atlanticism is a return to the dark ages of the interwar era: nationalized European defenses, American isolationism, xenophobia, demagoguery, and the other evils associated with the rise of Hitler and World War II. Former U.S. senator Malcolm Wallop (R-Wyo.) warns that weakening NATO will have dire consequences. "As we have thrice before in this dreadful century, [we will] set in motion an instability that can only lead to war, shed blood, and lost treasure. Pray that we are wiser."(4) Lawrence di Rita of the Heritage Foundation similarly defends NATO as an "insurance policy" against a future world war. "If keeping 65,000 young Americans in Europe will prevent 10 times that many new headstones in Arlington cemetery once the Europeans turn on themselves again--as they have twice this century--then it's a small price to pay."(5) Such alarmism underestimates the significance of 50 years of economic and political cooperation among the West European powers and the role of pan-European institutions such as the Organization for Security and Cooperation in Europe. It also ignores the fact that a viable institutional alternative to NATO--the Western European Union--already exists. With the proper resources and recognition on the part of Washington and the Europeans that an independent European defense is essential in the post-Cold War era, the WEU is a promising alternative to Atlanticism. Far from being a lame second choice to NATO or defense on the cheap, a robust WEU would be superior to NATO in many ways, better suited in the long run to protecting European and, indirectly, American interests. AT: Natural Gas Price Spikes1. Natural Gas Price spikes have minimal impacts – and no effect on the macro-economy KLIESEN 06 an economist at the Federal Reserve Bank of St. Louis. [Kevin L., “Rising Natural gas Prices and Real Economic Activity,” November/December, Federal Reserve Bank of St. Louis Review, http://research.stlouisfed.org/publications/review/06/11/Kliesen.pdf] Beginning in early 2002, prices of crude oil and natural gas began to trend upward. By September 2005, as the damage to the production, refining, and distribution facilities in the Gulf Coast by hurricanes Katrina and Rita became clearer, natural gas prices rose to record-high levels in both nominal and real dollar terms. Although crude oil prices rose to a record-high level in nominal terms, they remained below the record high levels in real terms seen in early 1981. Previous research has shown that sharply higher oil prices have preceded all but one of the post- World War II recessions. However, less is known about the relationship between rising natural gas prices and macroeconomic activity, despite the fact that many manufacturing industries and, increasingly, electric utilities are heavy consumers of natural gas. Accordingly, one might reasonably assume that record-high levels of natural gas prices might have significant adverse consequences for U.S. macroeconomic activity. This article examines developments in natural gas prices and highlights recent trends in natural gas usage at both the industry and national levels. The article concludes with some empirical findings that generally suggest that rising natural gas prices predict growth in only a handful of manufacturing industries. Perhaps surprisingly, higher natural gas prices do not predict slower growth for the three industries where expenditures on natural gas are a relatively large share of total industry shipments: primary metals, nonmetallic mineral products, and chemicals. In terms of the aggregate economy, increases in crude oil prices significantly predict the growth of real gross domestic product (GDP), but increases in natural gas prices do not.
[Kevin L., “Rising Natural gas Prices and Real Economic Activity,” November/December, Federal Reserve Bank of St. Louis Review, http://research.stlouisfed.org/publications/review/06/11/Kliesen.pdf] Eventually, natural gas prices peaked in 1984 at $2.66 per mcf (nominal). Prices subsequently retreated modestly and then remained fairly stable for several years: From 1986 to 1999, natural gas prices averaged $1.87 per mcf, with a standard deviation of $0.24 per year. Following the 2001 recession, natural gas prices began to rise noticeably. By 2004, gas prices in both real and nominal dollars were at record-high levels. In late August 2005, Hurricane Katrina made landfall near New Orleans, Louisiana, and then about one month later, Hurricane Rita made landfall near the Texas-Louisiana border. These two hurricanes caused significant damage to the Gulf Coast’s production, refining, and distribution facilities. In response, natural gas prices surged. Over the first seven months of 2005, natural gas prices at the wellhead averaged $6.06 per mcf. By August 30, a day after Katrina’s landfall, prices in the spot market, which typically include a premium above the wellhead price, had surged pass $12 per million British thermal units (BTU), and by September 22, 2005, the day before Rita’s landfall, the spot price had risen to $15.00 per million BTU.3
[Kevin L., “Rising Natural gas Prices and Real Economic Activity,” November/December, Federal Reserve Bank of St. Louis Review, http://research.stlouisfed.org/publications/review/06/11/Kliesen.pdf] Table 7 also reports tests of whether changes in natural gas prices predict real GDP growth. The evidence presented in the table suggests that that is not the case. Unlike increases in crude oil prices, increases in natural gas prices do not significantly predict real GDP growth using either of Hamilton’s specifications. These results are generally consistent with the total manufacturing results reported earlier. CONCLUSION In the aftermath of the disruptions caused by hurricanes Katrina and Rita, natural gas prices faced by consumers and producers rose to record high levels. Because natural gas is the second most important energy source for the economy, there was widespread concern that these high prices might cause a significant slowing in the economy and among those manufacturing industries that depend heavily on natural gas as a source of energy. The analysis presented in this article offers some support for the latter contention, but only when prices are transformed according to the specification suggested by Hamilton. However, the results using Hamilton’s specifications indicate that changes in natural gas prices do not cause significant output effects for the two manufacturers that are the most-intensive users of natural gas (primary metals and nonmetallic mineral products), although they do cause significant output effects for other, less-intensive manufacturers (such as machinery and computers and electrical products). While perhaps significant, this result must be balanced against the finding that, when the analysis is extended to the macroeconomy (real GDP), increases in crude oil prices significantly predict real GDP growth, but natural gas prices do not.
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