Event Information

The U.S. government spends billions of dollars each year on computer hardware, software and file servers that may no longer be necessary. Currently, the public sector makes relatively little use of cloud computing, even though studies suggest substantial government savings from a migration to more Internet-based computing with shared resources.

On July 21, the Center for Technology Innovation at Brookings hosted a policy forum on steps to enhance public sector adoption of cloud computing innovations. Brookings Vice President Darrell West moderated a panel of experts, including David McClure of the General Services Administration, Dawn Leaf of the National Institute for Standards and Technology, and Katie Ratte of the Federal Trade Commission. West released a paper detailing the policy changes required to improve the efficiency and effectiveness of federal computing.

Audio

• Moving to the Cloud: How the Public Sector Can Leverage the Power of Cloud Computing

Transcript

• Uncorrected Transcript (.pdf)
• Download Dawn Leaf's PowerPoint Presentation (.pdf)
• Download David McClure's PowerPoint Presentation (.pdf)

Event Materials

• 20100721_cloud_computing
• 0721_cloud_computing_leaf
• 0721_cloud_computing_mcclure

The tragic and deadly attacks in Paris, the day before leaders were set to arrive in Antalya, Turkey, for the G-20 summit, underlined the divisions that Syria, its fleeing population, and the terrorists of ISIS have created, as fear and short-term political calculations seem to shove aside policies aimed at sustainable solutions to the unprecedented refugee challenge.

It had started on a more hopeful note. Turkey, which chairs the G-20 this year, had placed the refugee issue on the agenda, hoping for a substantive global dialogue while looking for broad-based solutions to the crisis in Syria and the terrorism challenge. No doubt the 2 million refugees in Turkey played a big role, as President Erdogan and other officials tried to rally support for this unusual situation in a variety of G-20 and other venues.

Turkey was supported by another full member of the G-20, the EU, the only non-nation state member of the group, which shrugged off its complacency when hundreds of thousands turned up on its shores in 2015. European Council President Donald Tusk and Jean-Claude Juncker, European Commission president, echoed the Turkish President in calling for a global response: “Meeting in Turkey in the midst of a refugee crisis in Syria and elsewhere, the G-20 must rise to the challenge and lead a coordinated and innovative response… recognizing its global nature and economic consequences and promote greater international solidarity in protecting refugees.”

The G-20 is an imposing group, consisting of the world’s 20 largest economies, accounting for 85 percent of its GDP, 76 percent of its trade, and two-thirds of its population. Established in 1999 and growing in reach since the 2008 financial crisis, it should be a body that carries weight beyond the economic, with effective mechanisms to have impact on the global agenda. Yet, while Syria and the refugee crisis was the first time the G-20 stepped outside its usual narrower economic mandate, the agenda was quickly overtaken.     

The tragedy in Paris highlighted deep divisions over the refugees. Poland’s new government was the first to announce that it would stop participating in the EU resettlement plan whereby it would have accepted 5,000 refugees. Politicians from Hungary, the Czech Republic, Slovakia as well as those with a nativist message from the Nordic countries, France, Germany, and others saw an opening for tighter border controls and a much less welcoming approach to the more than 800,000 refugees that have already made their way into Europe, not to mention the many more on the way. Such views linking refugees to terrorism are not restricted to Europe but can be seen on the other side of the Atlantic, as U.S. presidential candidates and some 27 State Governors declared that Syrian refugees were not welcome.

At this early date, except for a single Syria passport “holder”—a document easily acquired these days, and found near one of the suicide bombing sites in Paris—all those who died or are being sought as suspects are citizens of either France or Belgium. Clearly, there could be some who get into Europe by using the refugees as a cover but with literally thousands of Europeans fighting in Syria, the real threat emanates from the small number of home-grown extremists in Europe who have easy access to the West and a cultural and linguistic familiarity that will elude newcomers for years. This was the same scenario one saw in the Madrid, London, Copenhagen, and the Charlie Hebdo attacks in Paris earlier this year. 

Fear is winning out over policy

The EU also appears in disarray on aiding the 4 million refugees in Jordan, Lebanon, and Turkey. This is significant since it is reduced funding and aid that is leading to the worsening of conditions in Jordan, Lebanon, and Syria, and driving many to Europe. Turkey too is reaching its limits and may potentially face a million or more new refugees if Aleppo falls. Yet funds pledged to these countries remain largely unfulfilled—of the 2.3 billion euros pledged by EU governments, only 486 million are firm government offers. The discussions between the EU and Turkey for additional aid to refugees of 3 billion euros also remain less-than-certain since such aid requires that EU countries agree to receiving and distributing asylum-seekers from Turkey. It also underlines the lack of funding for Jordan and Lebanon.    

In the end, the G-20 yielded little by way of concrete actions on refugees, though additional border controls, enhanced airport security, and intelligence sharing were promised. There was a call for broader burden sharing and greater funding of humanitarian efforts, as well as a search for political solutions. The G-20 also added little to the broad outlines of a potential settlement on Syria discussed in Vienna, Austria, on November 14, 2015, a day before the start of the G-20 summit.

Unfortunately, these are the very things that separate G-20 members among and within themselves. The growing danger is that fear and political opportunism rather than well-thought-out polices will guide the global response to the greatest human displacement tragedy since World War II. It is precisely this fearful and exclusive reaction that ISIS seeks. Indeed, that legacy may live long after ISIS is gone.                           

Last month, we experienced yet another breakthrough in the epic battle of man against machine. Google’s AlphaGo won against the reigning Go champion Lee Sedol. This success, however, was different than that of IBM’s Deep Blue against Gary Kasparov in 1987. While Deep Blue still applied “brute force” to calculate all possible options ahead, AlphaGo was learning as the game progressed. And through this computing breakthrough that we can learn how to better leverage the data revolution.

In the game of Go, brute-force strategies don’t help because the total number of possible combinations exceeds the number of atoms in the universe. Some games, including some we played since childhood, were immune to computing “firepower” for a long time. For example, Connect Four wasn’t solved until 1995 with the conclusion being the first player can force a win. And checkers wasn’t until 2007, when Jonathan Schaeffer determined that in a perfect game, both sides could force a draw. For chess, a safe strategy has yet to be developed, meaning that we don’t know yet if white could force a win or, like in checkers, black could manage to hold on to a draw.

But most real-life situations are more complicated than chess, precisely because the universe of options is unlimited and solving them requires learning. If computers are to help, beyond their use as glorified calculators, they need to be able to learn. This is the starting point of the artificial intelligence movement.  In a world where perfection is impossible, you need well-informed intuition in order to advance. The first breakthrough in this space occurred when IBM’s Watson beat America’s Jeopardy! champions in 2011. These new intelligent machines operate in probabilities, not in certainty.

That being said, perfection remains important, especially when it comes to matters of life and death such as flying airplanes, constructing houses, or conducting heart surgery, as these areas require as much attention to detail as possible. At the same time, in many realms of life and policymaking we fall into a perfection trap. We often generate obsolete knowledge by attempting to explain things perfectly, when effective problem solving would have been better served by real-time estimates. We strive for exactitude when rough results, more often than not, are good enough.

By contrast, some of today’s breakthroughs are based on approximation. Think of Google Translate and Google’s search engine itself. The results are typically quite bad, but compared to the alternative of not having them at all, or spending hours leafing through an encyclopedia, they are wonderful. Moreover, once these imperfect breakthroughs are available, one can improve them iteratively. Only once the first IBM and Apple PCs were put on the market in the 1980s did the cycle of upgrading start, which still continues today.

In the realm of social and economic data, we have yet to reach this stage of “managed imperfection” and continuous upgrading. We are producing social and economic forecasts with solid 20th century methods. With extreme care we conduct poverty assessments and maps, usually taking at least a year to produce as they involve hundreds of enumerators, lengthy interviews and laborious data entry. Through these methods we are able to perfectly explain past events, but we fail to estimate current trends—even imperfectly.

The paradox of today’s big data era is that most of that data is poor and messy, even though the possibilities for improving it are unlimited. Almost every report from development institutions starts with a disclaimer highlighting “severe data limitations.” This is because only 0.5 percent of all the available data is actually being curated to be made usable. If data is the oil of the 21st century, we need data refineries to convert the raw product into something that can be consumed by the average person.

Thanks to the prevalence of mobile device and rapid advances in satellite technology, it is possible to produce more data faster, better, and cheaper. High-frequency data also makes it possible to make big data personal, which also increases the likelihood that people act on it. Ultimately, the breakthroughs in big data for development will be driven by managerial cultures, as has been the case with other successful ventures. Risk averse cultures pay great attention to perfection. They nurture the fear of mistakes and losing. Modern management accepts failure, encourages trial and error, and reaches progress through interaction and continuous upgrading.

Hong Kong has seemed quiet for the last four months. The foreign media moved on to other stories once last fall’s protest movement came to an end. But locally the debate over a new system to elect the territory’s chief executive has continued non-stop, and the situation is about to heat up again. On Wednesday Hong Kong time, the government will announce its proposal for electoral reform. Once it does, the pro-democracy opposition will face some difficult choices.

Here, in not too much detail, is a quick review of the background.

In 2007, the government of the People’s Republic of China, which has sovereignty over Hong Kong, announced it would accept an election of Hong Kong’s chief executive (CE) through universal suffrage for the 2017 election. It also said that candidates would be picked by a Nominating Committee. Pro-democracy politicians and the public at large, a majority of which supports a more democratic system, welcomed the universal suffrage part of this pledge but suspected that Beijing would use the Nominating Committee to restrict who got to run. What good is a one-man-one-vote election, they asked, if voters had to choose between candidates who are from the territory’s conservative establishment camp and will likely accommodate Beijing? (Good question.)

The following ensued:

• After several years of public debate, the Hong Kong government began a formal process consulting the public in December 2013. The key point of disagreement was over whether election candidates could emerge only through a Nominating Committee vote or through other mechanisms as well. Those who wanted other mechanisms believed that the Committee’s membership would be friendly to Beijing and pick candidates accordingly. Some of these skeptics were prepared to engage in civil disobedience to try to get their way.
• In late June 2014, the Hong Kong government announced the results of the consultation and the incumbent CE, C. Y. Leung, made a formal report to Beijing. This was the first step in a five-step process for constitutional revision, a process set by China. There is general agreement that Leung’s report understated the opposition to a nomination system that relied exclusively on the Nominating Committee.
• On August 31st, the Standing Committee of China’s National People’s Congress (NPC-SC) announced a decision on basic parameters for the new system (step two). Sure enough, it ruled out any supplementary nominating mechanisms. It also strongly suggested that the Nominating Committee would be constituted the same way as the 1,200-person Election Committee that had heretofore selected the CE and whose members were mostly friendly towards Beijing. The NPC-SC also limited the number of final CE candidates to two or three and dictated that each had to receive majority support from the Nominating Committee to become a candidate.
• The public response to the decision was sharply negative. The logical conclusion seemed to be that the new system was rigged in a way that Hong Kong voters have to pick among establishment candidates only, and that a pro-democracy aspirant had no way of getting nominated.
• In late September, students began a civil disobedience campaign that was marked by episodes of violence, and resulted in the occupation of three sets of major roadways in the territory. These lasted until early December, but the campaign did not persuade the government to back down on its basic approach.
• At the same time, the Hong Kong government, staying within the parameters Beijing announced on August 31st, began a second consultation process on its more specific reform proposals.

Why, you may ask, doesn’t Beijing just impose the system it wants? The reason is that it already committed that in step three of the five-step constitutional revision process, the government would introduce a bill in the Hong Kong Legislative Council reflecting its final proposal and that the legislature would have to approve it by a two-thirds margin. Even though the legislature is constituted in a way that gives disproportionate power to interests aligned with Beijing, the establishment camp currently does not have enough votes for a two-thirds majority. Consequently, the government must win over four or five moderate legislators from the democratic camp. In response, the more radical democrats have worked hard to keep the moderates committed to rejecting any government that is based on Beijing’s parameters, because it means that China gets to screen who gets to run. 

In light of this problem, the Hong Kong government did a clever thing. In the consultation document, it included the option of “democratizing” the Nominating Committee while remaining within Beijing’s basic parameters. It proposed to do this first by making the body more representative of Hong Kong society and reducing the proportion of seats held by business interests and groups otherwise linked to China. Second, it suggested a two-stage process of selection. In the first stage, the Nominating Committee would consider more “potential candidates” than the two or three that would ultimately be nominated to run in the election. To be picked as a potential candidate, an individual would need the support of only a minority of Committee members (how low was unspecified). This could increase the possibility of one or more democratic politicians emerging as potential candidates and then, in the second stage, at least one of them being selected as a final candidate. The result would be a competitive election.

Last week, Raymond Tam, the Hong Kong government’s secretary for constitutional and mainland affairs, indicated that something along these lines would be proposed by the government this Wednesday. He talked of using “the necessary legal room to maximize the democratic elements” and making the “entrance requirement" for potential candidates no higher than one-eighth of the membership. Additionally, there would be greater openness, transparency and accountability in the process of reviewing potential candidates within the Nominating Committee.

The devil, of course, will be in the details of the proposal (more on that later in the week). Moreover, Tam said nothing about making the Nominating Committee more representative of Hong Kong society. Did that element get set aside, and if so, what are the implications? If the membership of the committee is still biased in favor of the political status quo, would it matter if the process within the Nominating Committee is more competitive and transparent?

Whatever the proposal, the ball will then be in the pan-democrats’ court. Do they vote as a block to reject any process that allows the Nominating Committee to screen candidates? Do they then want to expose themselves to near-certain criticism that their recalcitrance denied the Hong Kong public the opportunity to vote for the CE? Or, do they take a chance on the more flexible approach that Tam is proposing, in the hope and belief that a pan-democrat will be screened in, which in turn would seem to set up a competitive election?

Read Richard Bush's response to the Hong Kong government's proposal for electoral reform »

Editor’s Note: The National Perspectives on Global Leadership (NPGL) project reports on public perceptions of national leaders’ performance at important international events. This fifth installation of the NPGL Soundings provides insight on the issues facing leaders at the Seoul G-20 Summit and the coverage they received in their respective national media. Read the other commentary »

The week before the Seoul G-20 Summit was one in which the main newspapers read in Washington (The New York Times, The Washington Post and Financial Times) all focused their primary attention on the “currency war,” global imbalances, the debate on quantitative easing (QE 2), the struggle over whether there would be numerate current account targets or only words, and the US-China relationship. As early as Wednesday, November 10, The Washington Post front-page headline read: “Fed move at home trails U.S. to Seoul; Backlash from Europe; Obstacles emerge for key goals at G-20 economic summit.” By Thursday, November 11, things had gotten worse. “Deep fractures hit hopes of breakthrough; governments are unlikely to agree on a strategy to tackle economic imbalances” read the Financial Times headline on Alan Beattie’s article from Seoul. Friday, November 12, The New York Times front-page headline declared: “Obama’s Economic View is Rejected on World Stage; China, Britain and Germany Challenge U.S.; Trade Talks with Seoul Fail, Too.” By Saturday, the Financial Times concluded in its lead editorial: “G-20 show how not to run the world.”

From these reports, headlines and editorials it is clear that conflicts over policy once again dwarfed the progress on other issues and the geopolitical jockeying over the currency and imbalances issues took centre stage, weakening G-20 summits rather than strengthening them. Obama was painted as losing ground, supposedly reflecting lessening U.S. influence and failing to deliver concrete results. China, Germany and Brazil were seen to beat back the U.S. initiative to quantify targets on external imbalances. Given the effort that Korean leaders had put into achieving positive results and “consolidating” G-20 summits, it was, from this optical vantage point, disappointing, to say the least.

How was the Rebalancing Issue Dealt With?

At lower levels of visibility and intensity, however, things looked a bit different and more positive. Howard Schneider and Scott Wilson in Saturday’s edition of The Washington Post (November 13) gave a more balanced view of the outcomes. Their headline read: “G-20 nations agree to agree; Pledge to heed common rules; but economic standards have yet to be set.” They discerned progress toward new terrain that went beyond the agreement among G-20 finance ministers in October at Gyeongju, which other writers missed.

“By agreeing to set economic standards, the G-20 leaders moved into uncharted waters,” they wrote. “The deal rests on the premise that countries will take steps, possibly against their own short-term interests, if their economic policies are at odds with the wider well-being of the world economy. And leaders are committing to take such steps even before there’s an agreement on what criteria would be used to evaluate their policies.”

They continued: “In most general of terms, the statement adopted by the G-20 countries says that if the eventual guidelines identify a problem, this would ‘warrant an assessment of their nature and the root causes’ and should push countries to ‘preventive and corrective actions.’”

The Schneider-Wilson rendering went beyond the words of the communiqué to an understanding of what was going on in official channels over time to push this agenda forward in real policy, rather than declarative terms. As the Saturday, November 13, Financial Times’ editorial put it, “below the headline issues, however, the G-20 grouping is not completely impotent,” listing a number of other issues on which progress was made including International Monetary Fund (IMF) reform which the Financial Times thought might actually feed back into a stronger capacity to deal with “managing the global macroeconomy.”

The Role of President Barack Obama

Without doubt, the easy, simple, big-picture message coming out of Seoul was that Obama and the United States took a drubbing. And this did not help the G-20 either. The seeming inability of the U.S. to lead the other G-20 leaders toward an agreement in Seoul on global imbalances, the criticism of U.S. monetary easing and then, on top of it all, the inability to consummate a US-Korea trade deal, made it seem as if Obama went down swinging.

But again, below the surface of the simple, one got a different picture. Obama himself did not seem shaken or isolated at the Seoul summit by the swirl of forces around him. At his press conference, he spoke clearly and convincingly of the complexity of the task of policy coordination and the time it would take to work out the policies and the politics of adjustment.

“Naturally there’s an instinct to focus on the disagreements, otherwise these summits might not be very exciting,” he said. “In each of these successive summits we’ve made real progress,” he concluded. Tom Gjeltin, from NPR news, on the Gwen Ifyl Weekly News Roundup commented Saturday evening that the G-20 summits are different and that there is a “new pattern of leadership” emerging that is not quite there yet. Obama seems more aware of that and the time it takes for new leadership and new patterns of mutual adjustment to emerge. He may have taken a short-run hit, but he seems to have the vision it takes to connect this moment to the long-run trajectory.

Reflections on the Role of South Korea

From a U.S. vantage point, Seoul was one more stop in Asia as the president moved from India to Indonesia to Korea to Japan. It stood out, perhaps, in higher profile more as the locus of the most downbeat moments in the Asia tour, because of the combination of the apparent lack of decisive progress at the G-20 along with the needless circumstance of two presidents failing to find a path forward on something they both wanted.

From a Korean vantage point, the summit itself was an event of immense importance for Korea’s emergence on the world stage as an industrial democracy that had engineered a massive social and economic transformation in the last 50 years, culminating in being the first non-G8 country to chair the G-20 summit. No one can fault Korea’s efforts to reach significant results. However, the fact is that the Seoul Summit’s achievements, which even in the rebalancing arena were more significant than they appeared to most (see Schneider and Wilson), but included substantial progress on financial regulatory reform, international institutional reform (specifically on the IMF), on development and on global financial safety nets, were seen to be less than hoped for. This was not the legacy the Koreans were looking for, unfortunately.

Conflicts among the major players on what came to be seen as the major issue all but wiped out the serious workmanlike progress in policy channels. The leaders level interactions at G-20 summits has yet to catch up to the highly significant degree of systemic institutionalization of the policy process of the G-20 among ministers of finance, presidents of central banks, G-20 deputies and Sherpas, where the policy work really goes on. On its watch, Korea moved the agenda in the policy track forward in a myriad of significant ways. It will be left to the French and French President Nicolas Sarkozy to see if they can bring the leaders into the positive-sum game arrangements that are going on in the policy channels and raise the game level of leaders to that of G-20 senior officials.

Since it was created in 1935, Social Security has grown from covering about half of the work force to covering nearly all workers.  The largest remaining exempted group is a subset of state and local government workers (SLGWs).  As of 2008, Social Security did not cover about 27 percent of the 23.8 million SLGWs (Congressional Research Service 2011).  Non-coverage of SLGWs is concentrated in certain states scattered around the country and includes workers in a diverse set of jobs, ranging from administrators to custodial staff.  Some police and fire department employees are not covered.  About 40 percent of public school teachers are not covered by Social Security (Kan and Alderman 2014).    

Under current law, state and local governments that do not offer their own retirement plan must enroll their employees in Social Security.  But if it does offer a retirement plan, the state or local government can choose whether to enroll its workers in Social Security.  

This paper reviews and extends discussion on whether state and local government workers should face mandatory coverage in Social Security.^[1]  Relative to earlier work, we focus on links between this issue and recent developments in state and local pensions.  Although some of the issues apply equally to both existing and newly hired SLGWs, it is most natural to focus on whether newly hired employees should be brought into Social Security.^[2]  

The first thing to note about this topic is that it is purely a transitional issue.  If all SLGWs were already currently enrolled in Social Security, there would not be a serious discussion about whether they should be removed.  For example, there is no discussion of whether the existing three quarters of all SLGWs that are enrolled in Social Security should be removed from coverage.

Bringing state and local government workers into the system would allow Social Security to reach the goal of providing retirement security for all workers.  The effects on Social Security finances are mixed.  Bringing SLGWs into the system would also help shore up Social Security finances over the next few decades and, under common scoring methods, push the date of trust fund insolvency back by one year, but after that, the cost of increased benefit payments would offset those improvements. 

Mandatory coverage would also be fairer.  Other workers pay, via payroll taxes, the “legacy” costs associated with the creation of Social Security as a pay-as-you-go system.   Early generations of Social Security beneficiaries received far more in payouts than they contributed to the system and those net costs are now being paid by current and future generations.  There appears to be no convincing reason why certain state and local workers should be exempt from this societal obligation.  As a result of this fact and the short-term benefit to the program’s finances, most major proposals and commissions to reform Social Security and all commissions to shore up the long-term federal budget have included the idea of mandatory coverage of newly hired SLGWs.

While these issues are long-standing, recent developments concerning state and local pensions have raised the issue of mandatory coverage in a new light. Linking the funding status of state and local pension plans and the potential risk faced by those employees with the mandatory coverage question is a principal goal of this paper.  One factor is that many state and local government pension plans are facing significant underfunding of promised pension benefits.  In a few municipal bankruptcy cases, the reduction of promised benefits for both current employees and those who have already retired has been discussed.  The potential vulnerability of these benefits emphasizes the importance of Social Security coverage, and naturally invites a rethinking of whether newly hired SLGWs should be required to join the program.  On the other hand, the same pension funding problems imply that any policy that adds newly-hired workers to Social Security, and thus requires the state to pay its share of those contributions, would create added overall costs for state and local governments at a time when pension promises are already hard to meet.  The change might also divert a portion of existing employee or employer contributions to Social Security and away from the state pension program. 

We provide two key results linking state government pension funding status and SLGW coverage. First, we show that states with governmental pension plans that have greater levels of underfunding tend also to have a smaller proportion of SLGW workers that are covered by Social Security.  This tends to raise the retirement security risks faced by those workers and provides further fuel for mandatory coverage.  While one can debate whether future public pension commitments or future Social Security promises are more risky, a solution resulting in less of both is the worst possible outcome for the workers in question.  Second, we show that state pension benefit levels for career workers are somewhat compensatory, in that states with lower rates of Social Security coverage for SLGWs tend to have somewhat higher pension benefit levels.  The extent to which promised but underfunded benefits actually compensate for the higher risk to individual workers of non-Social Security coverage is an open question, though.  

Mandatory coverage of newly hired SLGWs could improve the security of their retirement benefits (by diversifying the sources of their retirement income), raise average benefit levels in many cases (even assuming significant changes in state and local government pensions in response to mandatory coverage), and would improve the quality of benefits received, including provisions for full inflation indexation, and dependent, survivor and disability benefits in Social Security that are superior to those in most state pension plans.  The ability to accrue and receive Social Security benefits would be particularly valuable for the many SLGWs who leave public service either without ever having been vested in a government pension or having been vested but not reaching the steep part of the benefit accrual path.  

Just as there is strong support for mandatory coverage in the Social Security community and literature, there is strong opposition to such a change in elements of the state and local government pension world.  The two groups that are most consistently and strongly opposed to mandatory coverage of newly hired SLGWs are the two parties most directly affected – state and local governments that do not already provide such coverage and their uncovered employees.  Opponents cite the higher cost to both employees and the state and local government for providing that coverage and the potential for losing currently promised pension benefits. They note that public pensions – unlike Social Security – can invest in risky assets and thus can provide better benefits at lower cost.  This, of course, is a best-case alternative as losses among those risky assets could also increase pressure on pension finances.

There is nothing inconsistent about the two sides of these arguments; one set tends to focus on benefits, the other on costs.  They can be, and probably are, all true simultaneously.  There is also a constitutional issue that used to hang over the whole debate – whether the federal government has the right to tax the states and local government units in their roles as employers – but that seems resolved at this point.

Section II of this paper discusses the history and current status of Social Security coverage for SLGWs.   Section III discusses mandatory coverage in the context of Social Security funding and the federal budget.  Section IV discusses the issues in the context of state and local budgets, existing pension plans, and the risks and benefits to employees of those governments.  Section V concludes.

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Editor’s Note: The following piece is a chapter from the 2012 edition of Eurasian Development Bank’s Eurasian Integration Yearbook.

INTRODUCTION

For centuries Central Asia was in the backwater of global political and economic attention, tales of “Great Games” and “Silk Roads” notwithstanding. However, interest in Central Asia from outside the region has been on the rise in recent years: Central Asia’s energy resources are of great importance to its neighbours in Europe and Asia. In addition, China wants a peaceful backyard, while Russia considers Central Asia part of its historical economic and regional interests and draws heavily on Central Asia migrants. Turkey is attracted by the common Turkic heritage of the region. Iran shares language and cultural ties with the Tajik people. The Central Asia’s Islamic tradition connects it with the Middle East and other Islamic countries. And now NATO countries rely on Central Asia for transit of their nonlethal military supplies in their engagement in Afghanistan.

There is wide agreement that economic prosperity and political stability in Central Asia is critical not only for the 60-plus million inhabitants of the region, but also for Central Asia’s neighbours, since Central Asia serves as a strategically important land bridge between Europe and Asia. Since the five Central Asian countries are landlocked small economies, a critical prerequisite for long-term economic growth and political stability is successful economic integration underpinned by effective regional cooperation.

This paper therefore addresses the central question of what are the prospects for regional economic integration and regional cooperation in Central Asia. It starts by briefly reviewing the role of Central Asia in the context of the overall process of Eurasian continental economic integration. It then considers what are the benefits and obstacles of regional integration and cooperation in Central Asia against the backdrop of lessons of international experience with regional integration and cooperation, and looks at four of the most important recent regional cooperation initiatives. In closing, the paper provides an answer to the question whether regional integration and cooperation in Central Asia are for real or only a mirage.

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