Politics and understaffing are the main reasons the United States has still not paid its outstanding dues to the general budget of the United Nations, after much news coverage of the problem in early October. The UN is experiencing an unprecedented financial crisis that threatens its peacekeeping operations globally and severely hampers its work in other basic areas. Lack of money has limited headquarters operations in New York, including even shutting down escalators and providing no paper for the photocopy machine in the Dag Hammarskjold library.
The US is not the only member state that has not paid its dues to the organization this year, but it is the largest debtor among the 55 countries that have not paid up as of November. Besides the US, five other countries with outstanding bills — Argentina, Brazil, Israel, South Korea and Venezuela — amount to 97 percent of total debt due to the UN in 2019.
Brazil owes $143 million in arrears, a situation that began before President Bolsonaro’s term, and it may be at risk of losing its voting rights in the General Assembly, a UN official said, noting that it appears the country does not have the money to pay.
Unpaid assessed contributions by all member states amounted to $1.4 billion as of early October, according to the UN, or $299 million more than last year. Catherine Pollard, the head of the UN’s Department of Management Strategy, Policy and Compliance, said the US was responsible for the largest portion of the unpaid regular budget — $1.05 billion as of October, compared with $842 million during the same period last year.
The dues are assessed according to a country’s wealth, and given that the US is the richest nation in the world, its mandated contributions are highest. The US funds 22 percent of the general assessed budget, so its delays are more painful to the organization.
Some nations have paid part of their dues since Pollard’s briefing, including the US, which on Nov. 25 delivered the final tranche of its $533 million owed for 2018 dues, according to the UN’s spokesman, Stéphane Dujarric. He said that the US still owed its 2019 dues of $491 million.
[Update: The US paid $300 million of its 2019 dues this week, after this article was published, a US State Department spokesperson told PassBlue on Dec. 6.]
The US generally pays after its fiscal year ends (Sept. 30), but the 2018 dues had been carried over to this year, and so far the 2019 dues have not materialized.
Dujarric said that the UN continued “discussions with them regarding further payments.” Neither the State Department nor the US Mission to the UN responded to PassBlue’s questions on the matter.
Dujarric clarified that the “US traditionally paid its dues in the fall. As to when they will pay the next tranche, that’s for the US to say.” That would mean that while the US holds the rotating presidency of the Security Council in December, the country could be in the red, according to its usual payment pattern.
Kelly Knight Craft, the US ambassador to the UN, just announced a Security Council trip to Kentucky, her home state, later this month, as well as a Council luncheon with President Trump at the White House on Dec. 5. Her office said that each Council member is responsible for paying his or her own travel and lodging to Kentucky. Knight Craft spoke to the media briefly on Dec. 2 about the trip but was not asked about the outstanding US dues. Her spokesman said she would give a longer media briefing on Dec. 6 at the UN.
Peter Yeo, the senior vice president of the UN Foundation, told PassBlue that in his 10-year career at the organization, he has never seen such delays in payments by the US. The UN Foundation advocates for the UN as an independent nonprofit organization based in Washington, D.C., and New York.
Besides the outstanding debt of the US and Brazil, Argentina owes $47 million. Iran and Venezuela, which owe $27 million and $17 million, respectively, cannot pay because of the economic sanctions imposed on them by the US government, impeding them from accessing their money through the international banking system. Israel ($11 million) and South Korea ($10 million) are the other big donors still owing their 2019 dues. Israel’s current government flux is causing the delay; and South Korea has technical challenges slowing the bureaucratic process down.
The US also owes $30 million for UN tribunals.
Politics and the peacekeeping budget
The US government agency that is delaying the US dues to the UN’s assessed budget is the Bureau of International Organizations Affairs at the State Department, which is the government interlocutor with the UN. A report issued in August by the State Department’s inspector general stressed that the hiring freeze ordered by the Trump administration in the bureau hampers its ability to comply with its duties.
The report said that “the hiring freeze had a broad and significant effect on overall department operations, particularly on its ability to address its most significant management challenges.”
The hiring freeze was a political decision, enforced by a Trump loyalist, the bureau chief, Kevin Moley. He recently resigned after accusations that he carried out political retribution against career diplomats deemed insufficiently supportive of the president. His last day was Nov. 29.
Moley was most likely following the guidelines put forth by other loyal officials of the president in the State Department.
According to an internal memo, published in October by Foreign Policy, State Department appointees planned to withhold more than $25 million in funding for UN human-rights programs, even though Congress had approved the transfers.
The shortage “severely hampers” the UN’s ability to fulfill its duties, according to a note sent in October by Secretary-General António Guterres to the UN’s 193 member states. Guterres warned that the liquidity crisis undermines the ability of the organization to carry out mandates that have been approved for intergovernmental bodies.
Peter Yeo of the UN Foundation is nonetheless confident the US will honor its commitments to the regular budget before the end of the year. He said that Congress has appropriated at least part of the US still-pending 2019 dues.
The real problem, he said, is peacekeeping funding, because “a political decision” has been taken by the Trump administration, supported by Congress, to not pay the UN dues in full — covering 25 percent instead of the 28.5 percent of the UN’s peacekeeping budget.
“Congress, with the administration support, is only paying our peacekeeping assessment at 25 percent, but we owe roughly 28 percent of the peacekeeping dues,” Yeo told PassBlue.
When Nikki Haley was the US ambassador to the UN, she persuaded Congress to uphold a law adopted in the late 1990s that determined that the US should not fund more than 25 percent of the Department of Peacekeeping Operations’ budget.
Congress has waived the limit in the past, most recently under the Obama administration, and financed 28.5 percent of the peacekeeping budget in 15 of the last 19 years, according to Yeo. Given this differential, the US now owes around $776 million to UN peacekeeping, which consists of 13 peacekeeping missions worldwide.
The debt is primarily the accumulation of unpaid dues over the last three years, since the beginning of Trump’s administration, in January 2017. If the 25 percent policy continues in the 2020 US budget, the US will owe peacekeeping around $1 billion by next summer.
Estimates by the UN, however, are different. According to figures released in October by Pollard, the US owes $2.3 billion to peacekeeping. Brazil owes $287 million, the second-largest amount, after the US. As a result of the debt, the UN has not paid $6 million to troop-contributing countries as of October. Guterres deemed the situation an emergency.
Yeo attributed the wide discrepancy of unpaid US dues to the peacekeeping operations ($2.3 billion vs. $776 million) to estimates of different fiscal periods. (The UN’s fiscal year is January to January.) The UN tends to show longstanding arrears in its official figures related to peacekeeping operations and the assessed budget. These arrears have often been carried over for decades, but the US does not acknowledge them anymore.
In recent US Congress budget negotiations, the respective appropriations committees approved a continuing resolution until final legislation is passed for the annual fiscal budget of the US government by the end of the year. The House of Representatives’ version approved a $478 million down payment to decrease the US arrears in peacekeeping dues, but the Senate version offered nothing on arrears.
It remains to be seen whether President Trump will sign off on the final legislation at the end of December. With impeachment proceedings underway, he could vent his anger at the process by stalling on the budget approval, Yeo suggested in a webinar on the US dues topic.