Sunday, May 28, 2017

Guam’s dangerous debate on casinos, a preview


A prediction: Casino gambling on Saipan will lead to a casino on Guam.

I’d bet on it.

Saipan’s new casino will siphon tourist traffic. As time goes on, Guam lawmakers will face pressure to allow a casino.

What will happen in Micronesia, has happened in the U.S. Let’s take New England as an example.

Connecticut allowed casino gambling after reaching an agreement in 1992 with the Mashantucket Pequots. Slot machines were illegal in the state and the Pequots needed state approval for them. The state agreed to slot machines in exchange for 25% of the revenue.

The Pequots opened a Las Vegas-style casino, Foxwoods, which became very profitable. It was the only casino in New England.

This put pressure on neighboring states to open casinos. Rhode Island now has a casino and Massachusetts is building them as well.

In fact, Massachusetts allowed a casino in Springfield near the Connecticut border. Connecticut now wants a casino near the state line, 12 miles from Springfield's casino. The goal is to keep Connecticut gamblers from crossing the state border.

Gamblers have little loyalty to any casino. They will go to the casino closest to them. This helps drive the growth of casinos. State lawmakers don’t want their residents gambling in a neighboring state.

Guam and Saipan are only separated by 135 miles. For travelers from China and Japan there is little difference in travel time. They might as well be neighboring states.

Saipan’s Imperial Pacific may generate more investment and tourism. This may be to Guam’s disadvantage.

As Saipan tourism grows, Guam’s lawmakers will feel compelled to take up the casino issue. The arguments will be powerful. A casino will provide a viable alternative for tourists considering Saipan.

But casinos impose a terrible cost. Having a casino on Guam will lead to problem gambling. They bring ruin to vulnerable families. Casino’s operate 24 x 7. This will increase the drunk driving risks. Crime may rise as well.

Opposition on Guam to a casino will be fierce. Guam’s faith community will issue strong warnings about the damage to families. Religious leaders may succeed in holding Guam back. But the Saipan casino, especially if it's successful, will be corrosive on public debate. As time goes on, lawmaker resistance weakens.

The casino debate in Massachusetts lasted some two decades. The resistance of lawmakers to casinos has all but collapsed in America. Indeed, President Donald Trump was a casino operator.

Thanks to Saipan, a new debate about casinos on Guam is inevitable.



Friday, May 12, 2017

Guam is built to withstand disaster

I arrived on Guam from the East Coast and had never experienced an earthquake tremor. The first was in the barracks. I was on the top rack and had a clear view of the ceiling from end to end. The tremor was jarring. The two opposite ends of the barracks appeared to twist in different directions. A few things fell off the shelves. It quickly ended and it hardly got a mention from the people who had been there a while.

Low-level tremors are common on Guam. If you stay on Guam for any length of time you'll experience one. Bigger earthquakes are possible. An earthquake on August 8, 1993, reached 8.1 magnitude. It damaged some hotels and but the disruption to the island was short-lived. Much smaller earthquakes have caused more damage in the U.S.

Experiences with typhoons -- which destroyed most of the wood-framed housing -- ushered in reinforced concrete construction. Most houses on Guam are of a pillbox design, low to the ground with flat roofs, and intended to resist typhoons. This also improves their capability to withstand earthquakes.

There are few buildings on Guam that pre-date the 1960s. There is very little construction pre-dating that time period. The 1963 typhoon Karen leveled the island, literally. It destroyed 95 percent of the homes. But Guam was able to rebuild to modern standards.

Monday, January 23, 2017

Trump affirms harder stance on South China Sea

Blocking China's access to disputed South China Sea islands may really be on the table with President Donald Trump's administration.

To recap, this is what Rex Tillerson, recently told a Senate committee about the South China Sea: "We’re going to have to send China a clear signal that, first, the island-building stops and, second, your access to those islands also is not going to be allowed.” 

Did Rex Tillerson really mean that the U.S. would be willing to block access to the disputed areas in the South China Sea? Was Tillerson was taking an outlier position? But it turns out this may not be the case.

Consider what Sean Spicer, the White House press secretary, said at a press briefing today: "I think the U.S. is going to make sure that we protect our interests there. So it's a question of if those islands are, in fact, in international waters and not part of China proper, then yes, we're gonna make sure that we defend international territories from being taken over by one country."  (Source, Washington Post transcript.)

It doesn't seem like there's much daylight between the two statements.

Reuters view: Trump White House vows to stop China taking South China Sea islands.

One worrying thing about the Trump administration is this: It seems inclined to blunt-edged policy decisions, such as imposing a federal hiring freeze even if such a action may end up costing the government money, creating headaches for the people it directly serves, such as veterans and Social Security beneficiaries.  Making the IRS that less capable of recovering tax dollars doesn't seem to make too much sense. But that's another issue (and one that hits Guam as well.) Another example of blunt force policy making is its recent action to pullback enforcement of Obamacare absent any replacement plan.

The Diplomat seemed a little nervous in its report about this emerging China policy, but it also optimistically suggest that Spicer and the administration really haven't figured it out. Read: The Trump Administration Needs a Clear South China Sea Policy.

Trump Monday also met with CEOs of a number of major corporations, some of whom source their products from China, such as Dell. I can't imagine these business leaders urging Trump to follow a path with China that could destabilize global markets and trade routes.


Sunday, January 22, 2017

Putting Guam in harm’s way


"We’re going to have to send China a clear signal that, first, the island-building stops and, second, your access to those islands also is not going to be allowed.”

-- Rex Tillerson, Trump’s nominee for secretary of state, Senate confirmation hearing.

Rex Tillerson, the former Exxon chief and President Donald Trump’s nominee for secretary of state, doesn’t seemed prepared for this job.
For sure, China’s claims to the South China Sea are audacious and worrisome. It appears to be turning its artificial islands into military bases, a clear threat to the region. But how do you resolve it?

Tillerson is suggesting confrontation. To underscore a key point: “your access to those islands also is not going to be allowed," he said.
How do you stop China’s access to the islands? Through a blockade of U.S. warships? And how might China respond?


The consequences of such a policy are unimaginable. An armed conflict over China’s South China Sea policy is not the way to resolve this matter.


A China policy built on escalating tensions will end badly for all sides. And let’s not forget the other impacts. The global economy will crash. There will be supply shortages in the U.S. because of trade disruptions with China. The scenarios are too painful to think about.

Guam will feel this tension. If the U.S. starts escalating tensions, it seems probable that Guam will see increases in the military presence and economic disruption as well, especially if it impacts tourism.

The oversize military's presence on the island has, at least since the Vietnam-era, been relatively benign. Guam has never had a direct threat since World War II. All that changes if the Trump administration starts searching for confrontation.
This is not a healthy development for Guam. If the U.S. starts increasing the military presence on the island as part of a saber-rattling strategy with China, island residents will face stress and worry. And for what?


Tuesday, January 10, 2017

Sad news about a Washington link to Guam

Saturday, January 7, 2017

Bordallo can broaden inquiry into Agent Orange use on Guam

The U.S. Defense Dept. denies that Agent Orange was used on Guam to control vegetation, despite contrary evidence. There are witnesses’ stories, photographs and testimony. There is a Web site that has aggregated some of this material.

The Dept. of Veterans Affairs (VA) does appear to support claims that Agent Orange was used on Guam. The VA “concluded that herbicides, particularly Agent Orange, were used on Guam from 1968 to 1970,” according to a National Institute of Health (NIH) paper published in 2015, titled “Disparities in Infant Mortality Due to Congenital Anomalies on Guam.”

This NIH study claims to be the first to identify associations between Agent Orange use and infant mortality in civilian populations outside of Southeast Asia. It concluded that “the results suggest that infants born to mothers who resided in AO (Agent Orange) spray areas were at an increased risk of infant mortality due to congenital anomalies.”

A new witness has emerged. An Air Force veteran told the Pacific Daily News that during his time at Andersen Air Force Base, Agent Orange was used.

The news report prompted Guam’s U.S. Rep., Madeleine Bordallo to ask the Air Force about it.

She wrote:

“I am deeply disturbed with the recent claims that Agent Orange was actively used at Andersen Air Force Base during the 1960s and 1970s. While the DoD has acknowledged that Agent Orange did transit through Andersen Air Force Base, it has consistently denied that the chemical was used for any purpose on island. However, I have heard these claims from constituents and from other service members that have served on island. As such, I have asked for the Air Force to provide me with additional information regarding the handling of Agent Orange on Guam as well as any reports of any use of the chemical on island. It is important that DoD provides very clear information regarding this matter to the public. This recent news claims is troubling, and I will work to ensure that our community is fully informed of the facts on this issue.”

There are a few more things that Bordallo can probably do.  She could contact the researchers who wrote the 2015 NIH study and find out if there has been any follow-up research to answer the questions raised by their study. Their report made a strong case for follow-up studies.

Bordallo ought to as, as well, find out whether Agent Orange was used at the Naval bases, and whether its toxins entered in the water supply and Guam's environment generally. People need clarity about the risks. The impact from the use of Agent Orange appears to be, potentially, island wide, based on what the NIH study found.

It would be interesting to know whether veterans who served on Guam during the period the spraying took place, and in the immediate years after, reported unusual medical conditions or conditions linked to Agent Orange.

The Guam government can weigh in as well and provide support for Bordallo.

Bordallo can press a case for a congressional hearing on this issue. The NIH findings alone make the argument for one. The more attention on this issue, the greater the odds others who know something will step forward.

Sunday, December 25, 2016

Guam's debt risk may guide the island's destiny

The Fitch Rating bond downgrade is getting dismissed by Guam officials as inconsequential. But its warning, detailed in the Pacific Daily News report, ought to give pause.

Fitch is saying that Guam has a "sizable outstanding debt obligations" primarily for one of its pension plans. The problem, says Fitch, is the island has "limited gap closing capacity and would likely experience fiscal distress in a moderate downturn," the PDN reported.

This means a recession may bring serious financial problems to Guam.

Guam's tourism economy is very susceptible to regional economies. The island saw nearly 1.4 million visitors through November, an increase of 9.1%, according to the Guam Visitors Bureau data. But any slowdown in the economies of Korea, which accounts for 39 percent of visitors, or Japan at 48 percent, is going to hurt.

Then there is President-elect Donald Trump's administration, a wild card if there ever was one. The implications of the Trump administration on geopolitical stability, the economy and military are all unknowns.

Guam sees China as a big tourism hope. There were only 1,377 visitors from China who arrived in November out of 126,000 overall visitors to the island that month. But expectations are that China may one day become as important as South Korea, which was responsible for nearly 49,000 visitors last month.

The larger risk for Guam, however, is increasing dependency on the U.S.

Worries about debt may help drive support for expanded military presence on the island. Buildup opponents oppose may find themselves fighting those with concerns about Gov Guam's pension funds and budget.