Coining a new jurisdiction: the Security Council as economic peacekeeper.

AuthorBoon, Kristen E.

ABSTRACT

Economic conditions are linked to international peace and security. Financial crises, mismanagement of natural resources, food shortages, and climate change can create transnational effects, including conflict. The Security Council is the executive organ of the United Nations, with primary jurisdiction over the maintenance of international peace and security. This Article explores the extent to which the Security Council can and should assert jurisdiction over economic and financial issues.

In the past decade, the economic dimensions of conflict, including the economic causes of war, economic agendas of state and nonstate actors, and economic measures for reconstruction have become central to the Security Council's work and to contemporary concepts of collective security. This Article argues that the Security Council's increasing engagement with economic and financial issues is proper and permissible under Article 39, provided that certain thresholds are met. For example, purely internal disruptions such as bankruptcies would be unlikely to rise to the level of a threat to peace and security, whereas the manipulation of natural resources destined for, or regulated by, international markets may well create threats within the Council's jurisdiction. The Security Council's enforcement jurisdiction under Article 41 has similarly evolved, shifting from the wholesale restriction of economic opportunities via trade embargoes and sanctions to the promotion of prospective measures such as good economic governance. If the Council's economic interventions continue, it will become a player of some significance in applying and developing international economic norms.

Ultimately, the Security Council's jurisdiction over new threats to peace and security--including economic and financial issues--is a function of its legitimacy. Support for the Council's evolving economic jurisdiction will be highest if the Council adopts measures to improve its procedural and substantive legitimacy among member states. This Article thus situates its analysis within the context of democratic decision making and argues for a better delineation of economic responsibilities among the Security Council and other international entities, such as the IMP, the World Bank, the General Assembly, ECOSOC, and the Peacebuilding Commission.

TABLE OF CONTENTS I. INTRODUCTION II. THE LINK BETWEEN PEACE AND ECONOMICS III. THE SECURITY COUNCIL'S GROWING INVOLVEMENT IN ECONOMIC ISSUES A. Comprehensive Embargoes B. Illicit Financing C. Economic Governance D. Compensation IV. THE CRITICS OF THE SECURITY COUNCIL'S INVOLVEMENT IN NEW THREATS TO PEACE AND SECURITY A. The Representation Critique B. The Regime Capture Critique C. The Jurisdictional Critique V. WHEN SHOULD ECONOMIC ISSUES BE CONSIDERED AS THREATS TO THE PEACE UNDER ARTICLE 39? A. The Security Council Is Empowered with Great Discretion B. "Peace" and "Security" Have Positive Dimensions and Include Economic Factors C. The Security Council's Practice Demonstrates an Evolution in Its Powers D. Acute vs. Chronic Economic Factors VI. ECONOMIC ENFORCEMENT MEASURES UNDER ARTICLE 41 OF THE UN CHARTER A. Economic Reconstruction B. Economic Governance C. Jurisdiction over Private Companies D. Legal Effects of the Security Council's Resolutions VII. REFORM OF THE SECURITY COUNCIL: WORKING METHODS, COORDINATION A. Working Methods B. Coordination VIII. CONCLUSION AND OPERATIONAL IMPLICATIONS FOR THE SECURITY COUNCIL I. INTRODUCTION

The severity and frequency of financial crises, especially the combined currency and banking collapses of the past decade, have made financial instability a scourge of our times, one that bears comparison with damage inflicted by famine and war. (1)

Economic conditions are linked to international peace and security. (2) Financial crises, mismanagement of natural resources, food shortages, and climate change can create transnational effects, including conflict. The repercussions may include refugee flows, trafficking in people and goods, unrest or conflict, and even terrorism where haven is given to individuals involved in such activities or to the funds that support them. (3) Research has shown that richer states and states with higher levels of economic growth are less prone to large-scale internal violence. (4) Furthermore, a strong correlation exists between the level of income at the end of a conflict and the likelihood of relapse. (5) As a result of these links, economic policies are an important component of multilateral intervention by international organizations. (6)

The Security Council of the United Nations (UN) has primary jurisdiction over the maintenance of international peace and security. (7) It is often said that the powers accorded to the Council under Chapter VII of the UN Charter make it the most powerful international "organ in history." (8) Like the ancient Privy Council, the Security Council is part court, part legislator, and part executive. (9) Indeed, the Security Council has almost unlimited discretion in taking coercive action against the states and entities that it determines threaten peace and security. (10) Its Chapter VII resolutions are binding on member states and rank highest in the legal hierarchy, taking precedence over other instruments, including treaties and domestic laws. (11) Moreover, the UN Charter imposes few express limits on the jurisdiction of the Security Council, and the Council is virtually immune from judicial review. (12) Given this context, it is not surprising that the Security Council's growing interest in combating new threats to peace and security is generating commentary and concern.

Over the past decade, the Security Council has adopted a variety of direct and indirect economic measures in pursuance of its mandate. It has frozen funds associated with terrorist financing, promoted economic stabilization in post-conflict zones such as Kosovo and East Timor, integrated principles of economic governance such as transparency and accountability into the transitional governance regime in Liberia, and developed an increasingly sophisticated range of peace-building strategies to stabilize the ownership of natural resources like oil, timber, and diamonds. (13) The Security Council has also partnered with or facilitated the economic intervention of other international actors in post-conflict situations such as the World Bank, the International Monetary Fund, regional organizations, donors, and the private sector. (14) In sum, the economic dimensions of conflict--including the economic causes of war, economic agendas of state and nonstate actors, and economic measures for reconstruction--are becoming central to the Security Council's work and to contemporary concepts of collective security. (15)

Given that economic globalization is a reality, and that economic issues are major causes of conflict, this Article assesses the extent to which the Security Council can act on economic threats to peace and security in fulfillment of its mandate. The UN Charter permits the Security Council to take jurisdiction under Article 39 when any situation poses a "threat to peace and security." (16) The Charter does not distinguish among the sources or types of threats, however, and it is this Article's contention that certain economic and financial issues fall within the Security Council's Chapter VII jurisdiction, permitting it to respond to catastrophic economic situations, as it did in Albania after the collapse of the pyramid savings schemes in 1997. (17) Only acute or illicit situations will meet the Article 39 threshold, however, and this Article explores what those factors might be in order to distinguish them from chronic or discrete economic and financial situations that lie outside of the Council's competence.

A second dimension of the Council's economic jurisdiction arises from its Article 41 enforcement powers. Although the Council has the power to authorize both nonmilitary and military measures to render compliance with its decisions, it has increasingly relied on nonmilitary tools such as economic sanctions over the past decade. These regulatory measures discourage financial support for terrorism, promote economic rehabilitation, and encourage good economic governance. The Council is no longer simply responding to crises that have already erupted with economic sanctions; rather, it is integrating preventive economic measures into its long-range peace and security strategies. Given the Council's prospective economic focus, this Article examines the Security Council's emerging role as an international economic risk manager and a generator of international economic norms.

This Article is organized in seven parts. Part II addresses the links between peace, economics, and security at the founding of the UN. Part III describes the Security Council's recent economic measures, and Part IV discusses why such measures have drawn criticism. Part V takes up the Security Council's Article 39 jurisdiction and also demonstrates which economic issues can fall within these parameters and what limits apply. Part VI outlines the Security Council's economic jurisdiction under its Article 41 enforcement powers. Part VII concludes the Article with a discussion of democratic decision making and situates the Security Council's jurisdiction over economic threats to peace and security within the debate on Security Council reform and better international coordination.

  1. THE LINK BETWEEN PEACE AND ECONOMICS

    The connection between peace, economic development, and freedom was keenly understood when the United Nations was created in 1944. After World War I, John Maynard Keynes noted that the "economic tendencies which underlie the events of the hour" were left unaddressed by the Peace of Paris. (18) He was most struck by the lack of focus on the economic dimensions of the postwar talks: "[I]t is an extraordinary fact that the fundamental economic...

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