Chernobyl Nuclear Accident Congressional Hearings Transcript

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FORMULA FOR FUNDING
American assistance to Ukraine should be constructed to provide benefit to
Ukraine and to the United States. It is not necessary, indeed, it is fooUsh, to release
the money of the American taxpayer to the custody of international institutions
where it is used to support European efforts to build market position in the Newly
Independent States. American assistance should produce real and measurable improvement
in Ukraine and should produce measurable economic benefit to the
United States. Achieving such mutual benefit is neither difficult nor mysterious.
America's competitors readily understand the formula.
Seed Money with Strings Attached
First, seed money or grants are required to start the process. However, these
grants must require that resources of United States firms be employed to executed
the mission of the grant. Additionally, the grants must require a suitable in-kind
match from the receiving nation.
Several objectives are achieved by these simple requirements. First, the money of
the United States is used to employ citizens of the United States and a substantial
portion of the money is further spent in the United States, providing additional economic
benefit. More important, the work under the grant is executed using American
approaches and technology, building a foundation for additional American and
Ukraine interaction. Second, by requiring an in-kind match, it is assured that
American and Ukrainian scientists and engineers will work together on the project
funded by the grant. This builds the most important aspect of any business enterprise,
mutual understanding and respect. This process will also implant the most
important element of the market economy transition; management systems.
Management Systems
There is no effective way to communicate in this testimony the breadth and depth
of the chasm that separates Communist and American management approaches.
Only day to day personal experience can demonstrate the magnitude of this difference
in approach. If Ukraine is to succeed in its transition, management approaches
of a market economy must be learned. Western nations will make a tremendous
error if they simply supply money to the Newly Independent States. Another string
is that with grants or loans, western management systems must be employed. This
will, of course, provide auditable accountability for the use of funds, a critical but
minor benefit. More importantly, this string will imbed management practices that
are vital for the success of the transition to a market economy. That is why the
program that we present has created a management system as the first step, before
funds are sought.
Sovereign Debt
Finally, Ukraine must stand on its own feet and build its own future. It is necessary
that grants be structured in a program that leads Ukraine to the ability to
provide the funding itself. If the export capacity of Ukraine can be revitalized then
the capacity to assume long term debt is created. This will allow Ukraine to support
its own programs; will enable Ukraine to purchase necessary services and goods;
and will empower Ukraine to build its future. The path from grants to loans should
be clear in the conditions and program of any grant. If such loans were to be provided
directly to Ukraine, instead of through international institutions, then we could
be assured that the services and good of the United States would be utilized.
In summary, grants have the following requirements:
• Clear objectives and plans
• Use of American resources
• In-kind matches from receiving nation
• Use of American management systems and approaches
• Clearly leads to future use of receiving nation's funds or sovereign debt.
Loans have the following requirements:
• Clear objectives and plans
• Use of American resources in collaboration with receiving nation resources
Use of American management systems and approaches.
America's assets
Why should the United States undertake this program? The economic benefits described
are valuable in themselves, but there are other opportunities that are also
attractive. What is there about the Chernobyl opportunity that offers a special advantage
to the United States?