Radley Balko | January 23, 2009
Forget extraordinary rendition or arresting Internet gambling executives, Pulitzer Prize-winning journalist David Cay Johnston argues in Mother Jones that if the laws of another country conflict with those of the U.S., we should just invade them.
Okay, so he's talking about the Cayman Islands. Still, it's a pretty astonishing proposal.
In 1983 just 10 percent of America's corporate profits were funneled through places that charge little or no corporate income tax; today more than 25 percent of profits go through tax havens. The Obama administration could tell the Caymans—now fifth in the world in bank deposits—to repeal its bank secrecy laws or be invaded; since the island nation's total armed forces consists of about 300 police officers, it shouldn't be hard for technicians and auditors, accompanied by a few Marines, to fly in and seize all the records. Bermuda, which relies on the Royal Navy for its military, could be next, and so on. Long before we get to Switzerland and Luxembourg, their governments should have gotten the message.
Johnston then seems to get an inkling of just how preposterous his idea is and backs down a bit, just before proposing more bad ideas:
Barring gunboat diplomacy (tempting as it is), there is no reason we cannot pass laws to block financial transactions with tax havens or even, Cuba-style, make it a crime for Americans to visit or do business with them without special permission. Congress could declare the hiding of funds a threat to national security and require that anyone with offshore assets disclose them to the IRS within 30 days and pay taxes, interest, and penalties within 180 days. For the holdouts, temporary special teams in the IRS and Justice Department could speedily pursue civil or criminal charges.
Thanks to Chris Muir for the tip.
Via email, Johnston responds:
Wow, what reactions—many of them full of venom and personal attack, but without any substance on the issues in my article. BTW, for those who make wild guesses and get it wrong, I am a registered Republican and chairman of a corporation I founded with one of my sons. The issue: our federal government forces employees to pay taxes on their wages through a rigorous withholding regime, but Congress lets people with non-wage income and corporations assess themselves with little or no verification and then lets them defer paying their income taxes for decades (with inflation reducing the value collected) and to outright evade taxes, a crime. We have two income tax systems, separate and unequal in their enforcement and reporting regimes. And of course in my Mother Jones piece I am jesting about actually invading the Caymans, as Radley sort of notes, but I am joking not about the need to enforce the law and stop helping calculated cheats get away with their felonies.
I apologize for getting Johnston's political leanings wrong. I'm not sure the jest of his invasion proposal was all that apparent, particularly given the severity of his actual proposals, which include a possible Cuba-like trade embargo on a country like Switzerland.
I happen to think countries that offer secret banking and tax shelters serve an important function. Their value may not be as apparent to everyone in the U.S., but I'd imagine even a skeptic like Johnston might see things differently if he lived in a country where the government was more callous about how it appropriated its citizens' possessions (which isn't to say there's nothing callous about taking money from taxpayers and, for example, using it to help failed financial houses pay out bonuses to their executives).
It's also pretty arrogant to think the U.S. government should simply impose its own laws on the rest of the world, be it with military force or by restricting the ability of its own citizens to engage in voluntary trade with the citizens of other countries.
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Bermuda, which relies on the Royal Navy for its military,
could be next
Um...what? Isn't a that a little...oh, what'st the word?
Bermuda, which relies on the Royal Navy for its military, could be next, and so on.
Because what the United States really needs right now is a war
with the UK.
What the fuck is this guy on?
And it begins. "Now our guy is in charge, it's time to use force
for our purposes!"
So unsurprising. This guy needs to be punched in the cock,
repeatedly. Not by me, of course, as that would be an initiation of
force. Maybe by GREENMAN.
Because what the United States really needs right now is a
war with the UK.
Did you see what happened to our economy after the last world war?
I say we go for it. We can call it, Falklands II, Caribbean
Boogaloo.
OT:
Looks like Gov Patterson's proposed replacement for Hillary as US
Senator (D-NY) is a pro-gun NRA "A" rated anti-baliout conservative
Democrat Kirsten Gillibrand.
I can believe in that change.
I dunno, sounds like a bunch of political mumbo jumbo to
me!
RT
www.privacy-tools.net.tc
Episiarch,
I seriously doubt David Clay Johnson considers Barack Obama "our
guy."
Here, look at this, from the story: President-elect Obama has
offered some interesting ideas to make the tax code more fair-but
by and large, his proposals amount to tinkering around the edges,
not the kind of serious restructuring previous presidents, most
notably Reagan, undertook.
In the extremely unlikely event that war with the Cayman Islands
comes, I will betray the US and side with the Caymans.
And the membership of the Cayman Popular Resistance Front will mark
well the names of those who advocated aggression!
joe, he wouldn't have even suggested it if the president was a
Republican. Obama may not be ideally "his guy", but he's as close
as a schmuck like Johnson is going to get.
It's like some paleoconservative suggesting homos be jailed because
there's a Republican in charge. He would never suggest it with a
Dem there.
This isn't a reflection on Obama, it's a reflection on assholes
like Johnson. We'll see more of this.
I live in Gillibrand's district. She has been all those things
you said and on record for them. But she needed to be to win
election in this conservative district.
Since she will need the whole state to reelect her in two years, I
think a shift to the left will be likely. Hopefully not, but only
time will tell. So far, I've liked the fact that she has actually
represented the people of our area, knowing it was a requirement
for her to continue getting elected. That dynamic changes now that
she represents the whole state which is more union/lawyer dominated
than our upstate region. She has not been shy about being friendly
to unions and she's a lawyer, so...
We cant defeat Switzerland in a war.
It would make Iraq and Vietnam look like Grenada.
Sorry to get off topic. Fuck Johnston. Maybe the fact that
companies want to keep their money offshore should clue in our
government that their tax laws are better than ours and we should
follow suit.
(holds breath....keels over)
We cant defeat Switzerland in a war.
There was somebody else who knew better than to invade
Switzerland.
Obama in 2012: "I thought they had weapons of mass tax evasion in Jamaica."
There was somebody else who knew better than to invade
Switzerland.
Absolutely.
You can kill all the Swiss. You cant conquer them.
And if you are ever on a rowboat with a captured Swiss resistance
leader and a storm comes up, do not untie him so he can row you to
shore. Doesnt work out as well as you might think.
To tie this whole post together, Austrian tyrants are stupid.
Uh, Johnson, Americans already have to disclose their off-shore
accounts to the IRS.
So, who are the special teams supposed to go after. Everyone who
hasn't declared off-shore assets?
And the membership of the Cayman Popular Resistance Front
will mark well the names of those who advocated
aggression!
Splitter!
Of course the whole point of a place like the Caymans is to store your overseas profits until its a good time to bring them into the country... not exactly the devilishly evil purpose the author supposes. The easier thing to do would be to design the tax system so that companies don't get an advantage from parking profits off shore until the feds announce a tax amnesty.
This isn't a reflection on Obama, it's a reflection on assholes like Johnson. We'll see more of this.
Yup, this. All the bluest team-blue mouthbreathers will be
clamoring to spout off some nonsensical proposal and in the end
look like idiots. It should be pretty entertaining!
"Congress could declare the hiding of funds a threat to national
security"
LOL
Congress itself is a far greater threat to national security than
any corporation using offshore tax havens.
I seriously doubt David Clay Johnson considers Barack Obama
"our guy."
But
Kevin Drum, who very approvingly linked to Johnston's piece a
few weeks ago, would definitely consider Obama 'his guy'.
It should be noted the any taxes that corporations pay are rolled into overhead costs and charged to end consumers, so if we did invade the Caymans/Jamaica/Switzerland/Luxembourg, we'd not only be paying for another idiotic war, we'd also be paying more for the goods and services that corporate entities provide.
Here, look at this, from the story: President-elect Obama has offered some interesting ideas to make the tax code more fair-but by and large, his proposals amount to tinkering around the edges, not the kind of serious restructuring previous presidents, most notably Reagan, undertook.
And there Obama is wrong. Simplification of the tax code, like
weeding the garden, should be done regularly. Kill the embedded
favors and lame social/economic engineering attempts (by both
parties), money will then go to more productive uses.
Some tax attorneys being required to find honest work is the
biggest economic downside.
robc,
I actually asked a real Swiss once about their citizen army. To
hear him tell it, Switzerland could have effectively resisted
invasion up to perhaps 1914. Today, a large nation like the US
could overwhelm them quite easily.
Hitler's could have too. The Swiss kept Hitler from invading by
doing his dirty work--providing a convenient place to hide Jewish
gold, for example.
Wouldn't the improved growth from a lessened tax burden across
the board allow those now unemployed accountants to find work
within companies that are getting to large for their current
accounting staffs to handle? So maybe less people go into the field
in the future, but the current accountants should be able to find
work helping companies become more efficient in their
operations.
I don't really give a rats ass for the attorneys.
Just advance the Caymans a little mustard gas and nation-build
their sorry asses based on the 1% "mushroom cloud" threat to the
US.
It worked for Rummy and Cheney.
I agree with J sub D: the tax code is due for another 1986-style
round of mucking out the stalls.
I'll just note that in 1986, neither Reagan nor the Democrats ran
on anything that remotely resembled the deal they ended up putting
together. Reagan came in with his tax reform plan, and O'Neil and
the Dems came in with a Democratic tax reform plan, and what we got
was worked out between them.
The tax code is a mess but I think a lot of the policy makers prefer it that way.
I think you would be hard pressed to name a country more deserving of being invaded than the Swiss. Fondue eating pricks. They are well armed, though - I think I remember reading that their rate of gun ownership is higher than the US.
Another theme is that lefties aren't againt war. They are
against difficult wars.
Kill 100,000 Iraqis on the highway, and that's ok.
The tax code is a mess but I think a lot of the policy
makers prefer it that way.
Well, the special interests that benefit (or think they benefit)
from all the provisions prefer it that way. The policy makers
prefer the votes and cash funneled their way for looking the other
way.
"The tax code is a mess but I think a lot of the policy makers
prefer it that way."
They absolutely do.
LOL, go after the swiss. if we can't handle the iraqis and al qaeda, there is no way we could handle a mountain country that has mined their roads and has SUPPLIED assault rifles to their people along with training.
We should invade Greenland. They should be easy to beat, and it'll remove the threatening presence of the Danes from North America. No more Danegeld!
the swiss also have 2 nuke bunker spaces per citizen, hidden aircraft hangars in mountains which can use highways for take-off + proxy nuclear deterrence from countries (like Pakistan , India, Russia) whose leaders keep their money there...
since the island nation's total armed forces consists of
about 300 police officers, it shouldn't be hard for technicians and
auditors, accompanied by a few Marines, to fly in and seize all the
records.
...and the coconut revenues will be more than enough to cover the
cost of the invasion! The topless hula dancers will welcome us as
liberators! We will make the Caymans a beacon of hope in the
Polynesian world!
This is the most brilliant satire since Swift's modest proposal. And you dumbasses were fooled by it! Good show, good show.
They should be easy to beat, and it'll remove the
threatening presence of the Danes from North America. No more
Danegeld!
Loki be praised!
Damn you, Episiarch, and your pro-Danish leanings! You'll be rounded up with the Danish-Americans, buddy, just you wait!
I actually read that whole article without gouging my eyes out;
it was tough sledding, but I made it.
It's always fun to see how different people can look at the same
"data" and come to spectacularly divergent conclusions about what
it means.
An Ottawa Reader
I lived in Switzerland for a while. The Swiss would probably agree
with you or not, depending on their mood and amount of honesty they
were in.
I do know, German reunification didnt make them at all happy (I was
there in 1991).
Sure, Hitler could have taken Switzerland, but at a price on the
level of taking Russia. In other words, it wasnt worth it.
I did find the WW2 era tank traps between the buildings in all the
towns along the German border to be interesting. They were there
for "historical" reasons or because "they never got around to
removing them". Yeah, right. The Swiss were a bunch of
procrastinating lazy asses. Gotcha.
i>We will make the Caymans a beacon of hope in the Polynesian
world!
Holy crap! If we can pull that off, we're gooood.
No, Bubba, they are against wars that have even a tangential
relationship to US interests and/or are initiated by a Republican
administration. See: Kosovo.
A war for Darfur, if launched this afternoon, would be lauded as
further evidence of Obama's wisdom, competence and all around
coolness.
They are well armed, though - I think I remember reading
that their rate of gun ownership is higher than the US.
Watching a Swiss teen (lets call him 19) running thru a train
station with his rifle and throwing it casually on the rack above
the seats [he was heading to on duty, from what I could figure]
makes you reconsider a lot of things. Normally Im fine around
people with weapons, I carry myself. Not in that case.
However, I was there before they got rid of the bicycle cavalry.
Seeing the bike units out on maneuvers was always cool.
All this is an amusing sideshow - meanwhile, Obaam's new
tax-cheater Treasury secretary designee is busy pissing off the
Chinese by explicitly stating China is manipulating it's currency
in a written response to Senate questions during his confirmation
hearing.
If the Chinese start yanking their money out of U.S Treasury
securities - or even refrain from continuing to buy them at the
rate they've been doing, Johnston would find out what a real
"national security" threat was.
GM,
Arent the chinese manipulating their currency. I dont think it
floats freely. Seems like a pretty accurate statement to me.
the swiss also have 2 nuke bunker spaces per citizen, hidden
aircraft hangars in mountains which can use highways for take-off +
proxy nuclear deterrence from countries (like Pakistan , India,
Russia) whose leaders keep their money there...
As if that weren't enough, deep within Lake Geneva the Swiss have a
giant atomic-fire breathing dragon monster, which periodically
arises and wreaks havoc upon invading armies. You don't want to
fuck with him.
Damn you, Episiarch, and your pro-Danish leanings! You'll be
rounded up with the Danish-Americans, buddy, just you
wait!
My great-grandmother's last name was either Anderson or Andersen.
So it could be Scandinavian--no one is sure. Just sayin' is
all.
the Swiss have a giant atomic-fire breathing dragon
monster
Mock all you want, but ask the Hapsburg's what happens when you
mess with the Swiss.
Also, Im pretty sure the dragon is in the Vierwaldstättersee, not
Lake Geneva.
"Arent the chinese manipulating their currency. I dont think it
floats freely. Seems like a pretty accurate statement to me."
Of course they are - but it isn't the thing to do to officially
label them as curreny manipulators. The Bush administration
advoided doing that because doing so would, by law, require the
Treasury dept. to begin negotiations with them to reduce their
trade surplus. There is an article about this today on CNBC's web
site.
Starting a trade war with China in this global economy with a
nation that were are not only counting on to finance a huge chunk
of our current national debt but also a huge chunk of all the
massive additional "stimulus" spending that Obama and the Dems want
to do isn't exactly a brilliant move.
It's okay, Episiarch. The Scottish side of my family comes from the part of Scotland that was occupied by the Danes (which means that I almost certainly have Danish/crazed Viking blood). So I will only with reluctance order you taken to the camp in International Falls.
Hey, Jormungand has to hang out somewhere.
Of course, our real enemies are those Gouda-breathed
Dutch!
Kevin
David "Cay" Johnston? "Cay"man islands? I think somebody's
trying to get restored to his throne.
I do find his writings a very helpful How-To for ditching taxes.
He'll adopt this pose of moral outrage over some loophole, and I'll
think "ooo, how to I get me some'a that sweeet action?"
there is no reason we cannot pass laws to block financial
transactions with tax havens or even, Cuba-style, make it a crime
for Americans to visit or do business with them without special
permission
These people are completely hopeless, groping the dark with pure
assertions.
So I will only with reluctance order you taken to the camp
in International Falls.
You'll have trouble catching me as leader of Le Resistance.
Of course, our real enemies are those Gouda-breathed
Dutch!
Everyone picks on the Dutch. What about the fucking
Luxembourgers?
Tulpa, the Cayman Islands are in the Caribbean. Polynesia is in
the Pacific Ocean, basically the other frickin' side of the world.
Hope you were kidding.
Ottawa Reader: I've actually been to Switzerland. Andy has a much
better take on the situation than your contact...the mountains are
honeycombed with bunkers, etc. The country is a terrain nightmare
-- think Afghanistan, only with a modern army which has focused on
repelling invasion.
Pro Lib,
I want to go back. The hiking is excellent (and steep) in that area
too. All the William Tell events occurred around that lake.
Including the real events. :)
I know the pound is weak, how is the Swiss Franc doing?
Maybe I need to start planning a trip.
Re: Greenland. As the descendant of vikings, I can say with pride that we are the only Europeans kicked off their land by Native Americans.
They Caymans are in the Caribbean, so if we turn them into a beacon of hope in the Polynesian world, what does that actually mean?
In David Brin's novel, Earth, the UN invades
Switzerland to claim hidden funds. I don't have that book handy,
but searching Google books, here's an excerpt from his 1999 book
The Transparent Society:
At this point let me drop even a pretense of scholarly detachment.
Since World War II, Switzerland and its fellow banking havens have
sheltered lucre for the world's tax cheats, drug dealers,
dictators, and mafias. In exchange for this money-laundering scam,
the banks could charge large fees and, above all, get away with
paying scant interest, a major unfair competitive advantage. Many
Third World countries have been stripped on working capital by
corrupt officials, entrenched elites, and criminal gangs. Out of
these ill-gotten gains, the pittance that was not squandered --
perhaps a few tens of billions of dollars -- arguably rests at this
moment in coffers alongside "dormant" accounts of Nazi warlords and
their hapless murdered victims. One might envision these poor
nations someday demanding justice -- as depicted in my novel
Earth -- but real pressure can come only from the West.
Recently, the bankers of Berne and Vaduz have begun loosening the
ignominious shroud of secrecy just enough to eliminate some of
their most disreputable clients, a few notorious drug lords, as a
sop to Western governments. But this gesture may not suffice when
hard-pressed U.S. and European taxpayers estimate how much of their
own burden might ease if aristocratic tax cheaters had to account
for their fair share.
Whether or not this scenario actually comes to pass, it is credible
enough that the world's elites should go on notice. Caching their
reserves in such havens may be self-defeating in the long run,
creating a dossier that will later haunt them when secret lists are
handed over to placate an angry world. From now on it might be
better to invest the money, whether ill gotten or not, in real
estate.
"Ottawa Reader: I've actually been to Switzerland. Andy has a
much better take on the situation than your contact...the mountains
are honeycombed with bunkers, etc. The country is a terrain
nightmare -- think Afghanistan, only with a modern army which has
focused on repelling invasion."
Well that still wouldn't save them under certain cirmcunstances. If
the attacking nation possesed large quantities of nuclear weapons
and it's objective was simply to destroy the country rather than
occupy it, their mountain bunkers wouldn't save them.
The old Soviet Union could have simply rained down H-bombs on them
from air all day long. If the blasts didn't get them, the radiation
poisioning would.
the CHF has had its ass kicked as well due to UBS and
credit-suisse buying american CDOs....
Maybe they shouldn't have left the gold standard in 1999....
So if you want to visit, it's cheap right now. Do it before the
dollar collapses...
Quoting myself from 2 hours ago:
You can kill all the Swiss. You cant conquer them.
David Cay Johnston has been a shill for the IRS in his "reportage" of tax protesters.
"You can kill all the Swiss. You cant conquer them."
Doesn't killing them also count as conquering them?
fx,
Yeah, exchange rate is below where it was in 1991. Looks like
recent peak was around 2001. It has rallied since it bottomed out
in December, however.
Johnston as a local beat reporter: "It's so unfair when greedy people lock their cars at night!"
"GM,
Not really, you cant rule over a corpse."
Sure you can.
All you have to do is pump some of that juice they used in the
movie "Re-animator" into it and get it moving again.
by restricting the ability of its own citizens to engage in
voluntary trade with the citizens of other countries.
What makes foreigners so special? The fed restricts our ability to
engage in voluntary trade with citizens of this country, too. They
can get screwed just like we do.
All you have to do is pump some of that juice they used in
the movie "Re-animator" into it and get it moving again.
No, you just have to have them bitten by a Sumatran
Rat-Monkey.
I, for one, would be fascinated to hear Johnston's take on the
EU's whining about the unfairness of Irish (and, presumably,
Estonian) tax laws.
Much of what he said in that article makes sense, in its individual
parts, but he draws unjustifiable conclusions, based on his
apparent belief that the government can, and should, decide what
each individual "deserves" to earn, and keep.
Bill, as much as I respect David Brin as a novelist, the passage
you quoted cuts both ways. The world's richest and most powerful
people pretty much all have their money in Swiss banks. Thus,
everyone at the top has a stake in ensuring that nobody messes with
the Swiss. Anyone who did mess with the Swiss would face the wrath
of everyone else with funds there.
Trying to make an analogy to MAD, but not finding it. Anyone? Epi?
Epi?
Sure, they're putting on a show of freezing the worst of the worst,
but that's just window dressing.
Trying to make an analogy to MAD, but not finding it.
Anyone? Epi? Epi?
Tonio, it's kind of like when, in The Uplift War, humans
are glad to hand over gorilla uplift to the Thennanin, because now
they'll be allies and nobody sane would fuck with the Thennanin,
even the Tandu. Understand now?
I hate to break it to Johnston, but he is a festering example of
all that's wrong with the GOP and those who call themselves
conservatives.
He freely admits that the government is planting the IRS boot heel
firmly in the working man's face and his solution to the problem is
to fuck everyone else too.
As a Republican he should be calling for tax relief, tax abolition,
a reduction in the size of government, and all the things that
Republicans and conservatives used to stand for.
It isn't any surprise that Balko didn't recognize him as a
Republican.
[turns and spits]
"His name is Ed, and he hates the Swiss!"
We should invade Greenland.
PL, do you want to imminentize the Ragnarok?
If we were to kill all the Swiss, then move some other people
into Switzerland, then they would be the new Swiss, whom we could
oppress and "conquer." I don't see the problem.
For any Swiss reading this, I'm only speaking hypothetically. I
personally love all of our European allies and not-so allies.
BP,
Absolutely.
GM,
I think it was Tobasco.
Woooooosh.
(the sound of a south park reference flying over your head)
Tonio | January 23, 2009, 12:14pm | #
Bill, as much as I respect David Brin as a novelist, the passage
you quoted cuts both ways.
Just quoting, not making an argument either way.
(the sound of a south park reference flying over your
head)
In his defense, that is a very old one.
And- if your article gets run by Mother Jones, yer a fekkin'
LEFTY.
How many times has Radley Balko written for FoxNews.com? Over
5,000. That craven neocon.
In his defense, that is a very old one.
1. There are no old South Park episodes
2. They show it every halloween
The Swiss are not allied to anyone. They are just that badass. Hell, they barely managed to join the UN coupla years ago.
Wait, so knowing South Park episodes by heart is a prerequisite for commenting now?
The guy is crazy for wanting to invade the Cayman islands. But
his solution does not detract I think from his accurate assesment
of a problem, and that is the two-tier tax code in the United
States. I mean, if you've got some coin and connections, you can
get away without paying your taxes. Look at the Geitner tool, or
Charlie Rangel. Or Mizz Kennedy...word around the Hyannis camp fire
is that there were some "tax problems" potentially derailing her
coronation bid. So for the rich, not paying your taxes is
problematic for securing a Senate job by fiat, but not a whiff of
criminal anything apparently. If I run a small business and have an
"error" pop up in my protection-payments for a quarter, its time to
meet the IRS guy for a "come to Jesus" moment if you know what I
mean. Definite double-standard there.
Offshore banks are at first blush a handy libertarian valve for
capital to escape stupidity, and operationally that is what they
do. However their existence prolongs the stupidity, because the
Establishment gets to escape the consequences of that stupidity
while inflicting it on everyone else. When everyone has skin in the
game, including the lucky elite who make up the rules of the game,
things change faster.
For instance, if I was Prez and wanted to launch a political
initiative of sorts to change America's drug laws, the first thing
I would do is get as big and bad of a drug-dragnet going to nab me
a clutch of the Rich Kids. All those Congressmens' kids in the nice
colleges, or nepotistically ensconed in some cush job (thanks
Daddy!) - they all do drugs as much as most poor people. One night
BAM! a couple hundred no-knocks get served across the land, all at
tony addresses. The uproar would be significant in the talking-head
sphere the next day, given its THEIR kids who are now on the
front-line of the war on drugs. Nothing changes and opens minds to
liberty and fosters hostility to the state like a couple nights in
GULAG
Okay, Tulpa; how about this:
If your article about imposing Social Justice through confiscatory
taxation gets run by Mother Jones, yer a fekkin' LEFTY.
"(the sound of a south park reference flying over your
head)"
It's kind of hard for me to get references from I show that I have
never watched.
So, his response to companies, productive, lucrative, profitable companies, leaving this country for greener pastures aren't to green our own a bit, but to salt those other pastures?
Isn't that what liberalism has always been about?
Achieving "equality" by dragging everyone down to the same
miserable level.
I am a registered Republican and chairman of a corporation I
founded with one of my sons.
Oooh, he registered his affiliation. And he's a
corporatist to boot! None of those on the left. Whoopie. His
solution to tax inequity is to impose those inequities on everyone
else. I'm reasonably confidant he voted for the big O. But hell, a
vote for McCain wouldn't really prove anything either.
When he actually espouses something non leftist I'll concede that
he's not a flaming leftist. Until then color me unconvinced.
"Isn't that what liberalism has always been about?
Achieving "equality" by dragging everyone down to the same miserable level."
No, you're confusing liberalism with socialism.
I scoff at David Cay Johnson being anything other than a populism-inclined NY Times leftie, no matter what his party affiliations might be. Johnson is an arrogant, self-righteous prig (his run-in with the late Cathy Seipp springs to mind) who routines squeals at any suggestion that he might be anything other than a selfless truth-teller. Anybody whose books are endorsed by Paul Krugman is nowhere near the mainstream of Republican, much less conservative thought. He's a "Republican" in the same sense that Kevin Phillips is--solely as a means to artificially gain credibility in the eyes of other liberals.
"No, you're confusing liberalism with socialism."
There's not a dime's worth of difference between the two.
David Cay Johnson is the NY Times writer who has covered the tax
honesty movement. I think this article illustrates just where his
bias lies.
Johnson at one point in his coverage asked the IRS Commissioner why
they did not simply answer the questions that the tax honesty
people are asking. He received points for journalistic integrity
for this, but he quickly squandered those integrity points by
consistently misrepresenting the legal issues presented by the tax
honesty folks.
A good bit of his dishonesty is revealed in Larken Rose's excellent
book, "Kicking the Dragon" --google it. It is worth reading.
So once again, what we discover with the different political
stripes of left and right, is that it's not the policy or the
process, but the cause. Invade, embargo, unilateralism,
unauthorized war, torture. That's not what we're focusing on. It's
why we're doing it that either makes it legitimate or
not.
Got it now.
So how would any of you solve the two-tiered tax system?
Johnston has done in-depth reporting about the ways the wealthy get
around paying their share (what all the rest of us are compelled to
do). His essential beef is with "socialism for the rich," which,
I'd think, libertarians should be against just as they are
socialism for the poor.
Flat tax.
The wealthy get around paying "their share" via influence-peddling
on the part of the people who write and interpret the tax code. If
the tax code were made simple and straightforward (and "loopholes"
abolished), there would be less fiddling and manipulation.
This would prohibit using the tax code as a means of social
engineering, so it will never happen.
I know plenty of people who think ideas like this are good - to
be sure they probably don't think through what "force" means, but
they think we should not let people move their money overseas. It's
"cheating" they say.
Instead maybe we should be learning a lesson - people like their
property so much they'd rather move it than let someone take it
away from them. Instead of closing off the option for some, open up
the option for everyone, or make our burdens less onerous so they
don't feel like they have to move it. THAT is the correct
response.
It's like when I worked at Motorola in the 90s and Chris Galvin
sent out an email saying anyone who used another phone were
"billboards for the competition" you know instead of analyzing what
was so horrible about Moto phones that even their own employees
didn't like them.
"So how would any of you solve the two-tiered tax system?"
Scrap the concept of an income tax completely and fund government
services on a user fee basis.
Government activites that are not actual services but merely
transfer payments, such as social security, medicare, farm price
supports, food stamps, etc. etc. would be eliminated.
Problem solved.
He's a registered Republican but calls Obama "our guy"? Methinks he's a liar one way or the other.
Ah, so we solve the inequality problem by going to the most
regressive system imaginable. No democracy can function on a flat
tax. And no properly informed democracy would enact one.
Corporations don't move money offshore because they're overburdened
by taxes. They do it because their job is to maximize profits, and
because they can. They won't stop trying to maximize profits at a
certain tax level out of the goodness of their hearts.
Johnston's argument is simply that, regardless of the tax scheme we
happen to have, who can possibly be in favor of letting the rich
and powerful cheat on their taxes while everyone else has to
comply? It's that simple. No need to muddle the argument with
pie-in-the-sky flat tax proposals. Even with a flat tax
corporations would look for loopholes. It's the government's job to
ensure the taxes it is owed are paid.
It is the point of a flat tax (both individual and corporate) to
take away most loopholes. For individuals, I believe that most
proposals deal with the regressive tax issue by exchanging a
somewhat higher rate for excluding certain income levels. There are
good arguments for going with a consumption tax, too, and dumping
the income tax altogether.
I've heard somewhere that the U.S., shockingly, has the highest or
among the highest corporate taxes in the West.
It is true that America has the second highest corporate tax
rate of the 30 most wealthy countries of the Organization of
Economic Cooperation and Development. It is also true that America
takes in the fourth lowest corporate tax revenues because of
government favors and loopholes.
If they can offshore money at X% why can't they do it at a lower
Y%? Even a flat tax would require rules to discourage tax
cheating.
No democracy can function on a flat tax. And no properly
informed democracy would enact one.
Eastern Europe seems to be functioning just fine.
You know, for eastern europe.
So how would any of you solve the two-tiered tax
system?
Followed by:
Ah, so we solve the inequality problem by going to the most
regressive system imaginable. No democracy can function on a flat
tax. And no properly informed democracy would enact one.
Always a personal fav. ZOMG our tax system is unfair! Answer: tax
reform vis. flat tax or nat'l sales tax (my favorite). Response:
ZOMG, our tax system will become unfair!
Our tax system is already unfair and immoral. Income tax
of any kind is immoral. Period.
It invites levels of government scrutiny into our lives that cannot
be justified in a free democracy. We have proof of this. Our
current system already invites all manner of scrutiny, and it went
through the roof with the PATRIOT act.
In the end, it is no business of the government what I make, what I
earn, and what someone pays me.
I don't like a 'flat tax' because it is ultimately more
regressive. A national sales tax can be tailored to be
non-regressive, or at least no more regressive than the very system
we have now, and eliminates the government having to chase
profit streams around the world or create voluminous texts
describing "income". Plus it eliminates the sheer stupidity of
someone having to pay taxes on a car they win on the Oprah show.
Does anyone really think about how fucking stupid that is? Someone
made a dollar, but where did he put it? With a national sales
tax...who cares? As soon as Bill Gates or Jay Z buys a ferrari,
they pay their tax.
P Brooks,
I don't think they're evil. I just thing they're single-mindedly
profit-driven and as such can't be trusted to do anything out of
pure generosity. For decades we've been fed this nonsense that
corporations can better handle almost anything than can government.
But too often that has turned into an excuse to remove the policing
responsibilities of government and to give corporations whatever
they ask for.
So what we end up with in the absence of a vigilant government is a
system that shifts risk away from the wealthy. Surely you guys are
equally miffed at this form of socialism as you always are about
any subsidy whatsoever for the poor.
I don't like a 'flat tax' because it is ultimately more
regressive.
It's imperfect, but that can be largely mitigated by excluding the
first "X" dollars of income. And no, I don't know what "X"
equals.
My personal belief is that the complications in "fixing" the
regressiveness of a consumption tax would lead us right back to the
stupid bullshit we're trying to get away from.
"So how would any of you solve the two-tiered tax system?"
Libertarian ideal would be flat tax at a very limited rate; all
wealth-distribution efforts, both overt and corrupt, would be
eliminated. Politically speaking, this isn't possible for a number
of reasons, first amongst them Charlie Schumer and Co. like the
power of arbitrarily taxing their "enemies" and somehow
distributing the proceeds to their "friends."
What drives such bad behavior - and what the slimeballs use to
justify it - is the general altruism of free societies. In a truly
free, libertarian society, people are free not just with their
soveriegnty but are free to surrender it to another person, usually
based on some goodie the other person will kick down ("free" health
care, a drug-free world, "safety" from all threats; from terrorists
with thermonuclear weapons to uninspected Mexican tomatoes).
Without going back to square one with more laws and crap to limit
people's ability to do this (and therefore limit their freedom)
there is no way I think to prevent that evolution from taking place
in a free society. Its why don't last very long. Knowing this,
there can be no long-term realization of the libertarian ideal in
such a context.
But the ideas always flittering through libertarian minds about
this subject focus on separating the government from money. But
since this isn't truly possible given the above realities about
people in gerneral, a more pragmatic line of thought would be
schemes that separate politicians and bureaucrats from direct,
unaccountable access to the Public treasury and credit-rating. Such
schemes could be something radically different than forms of
government that have been tried before. I am thinking of out-there
ideas like a "fiscal democracy" where on tax day the taxpayers
literally vote their taxes to departments and organizations. The
legislature would be limited to deciding what the flat-tax rate is
for instance, and the "core" government ops that libertarians think
should be a State's only function. Everything else stemming from
the public treasury would be up to voters to decide.
Such a mechanism would need an income tax system, a sales or
consumer-tax scheme wouldn't work in such a "fiscal democracy."
Billions of details would have to be rectified in as simple a
structure as possible (as measured in words-on-page). But if such a
scheme were implemented rationally, it would be a very real
revolution in the way the people fund their collective State, and
it would blow the current political order and associated cottage
industries away.
I am absolutely opposed to corporate welfare.
But I also do not believe in the Easter Bunny, Santy Clause, the
Tooth Fairy, or government employees who are selflessly
virtuous.
It's imperfect, but that can be largely mitigated by
excluding the first "X" dollars of income. And no, I don't know
what "X" equals.
And no one really knows what 'income' is. Moving targets all. Most
of the fixes for regressiveness on "consumption taxes" are already
in. See your local municipal sales tax code. In my opinion, it's
something that cities and states do fairly well.
Flat income taxes fix little if nothing. Flat tax for a guy with
three kids? Flat tax for the same guy with one or no kids? Doh! We
need some writeoffs. You can guess where that goes. Nat'l sales tax
even taxes black market incomes. A flat tax won't. The drug dealer
still has to buy his benzo, or his gold necklace.
Tuned properly, the poor will pay little or no tax, the wealthy the
most tax. And no bureaucrat will ever show up at your door to find
out where or if you're hiding your income.
Tuned properly, the poor will pay little or no
tax
The devil is always in the details. Just so you know, I actually
would prefer a comsumption tax. But, just for example, how do you
collect on "private sales"?
If you set your tax rates at that mythical point where avoidance is
more costly than compliance, you could presumably eliminate a lot
of problems. But how does that square with the revenue-neutral
level?
"I don't think they're evil. I just thing they're
single-mindedly profit-driven and as such can't be trusted to do
anything out of pure generosity."
Tony tony tony. Why the hell should they? corporations are owned by
the investors. The investors are free to take their profits and
donate them as they please. corporations aren't people, after all,
only a legal fiction allows them to be treated that way. Corporate
bigwigs are some of the most generous contributors to society that
you would ever meet. The problems start when they decide to
literally give away cash that should be going into my 401k.
"Flat income taxes fix little if nothing. Flat tax for a guy
with three kids? Flat tax for the same guy with one or no kids?
Doh! We need some writeoffs."
This is where the breakdown occurs for me. I don't understand why a
guy who has three kids needs some kind of extra break from society
relative to the guy who has one kid. He has less money for himself
because previous choices in his life left him with three kids
instead of one. Sounds like his problem.
Flat income taxes fix little if nothing. Flat tax for a guy with three kids? Flat tax for the same guy with one or no kids? Doh! We need some writeoffs.
I've never understood the concept of subsidizing procreation. What
is this, cold-war era Romania?
Just as I didn't say corporations are evil, I didn't say
government employees are virtuous. I prefer to leave moral
assumptions out of the equation.
A democratic government is responsive to the interests of the
people. A corporation is responsive to the pocketbooks of
shareholders. One's job is to maximize profit, the other's is to
make sure rules are enforced and that any tax scheme is fair for
the greatest number of people possible.
To me, fair does not mean some arbitrary percentage. It means, as
T. Jefferson put it, "Taxes should be proportioned to what may be
annually spared by the individual."
But, just for example, how do you collect on "private
sales"?
If you set your tax rates at that mythical point where avoidance is
more costly than compliance,
P Brooks. All valid points, except we already have a model. It's
called your local and state governments. Localities have been
pretty good at collecting sales taxes for a long time, and private
sales (for the most part) already avoid the tax. It's not like
Safeway or Albertson's are making behind the counter, super-secret
private sales to avoid the tax. The issue would have to be studied,
to be sure, but the advantage to moving to a sales tax is that we
already have one, so we would merely bump it up to a federal level.
The only question left is would or could it pull in enough revenue
for government to function. The cynical libertarian side of me says
"Geez, I hope not", but the realistic side says "don't know". I
suspect it could but it has to be studied.
I've never understood the concept of subsidizing procreation.
What is this, cold-war era Romania?
MAX-HATS, hal9000:
Nope, it's 21st century America. So I take it we're in agreement,
that you don't like an income tax (flat or otherwise), and prefer a
consumption tax. You know, so we can get away from subsidizing
procreation like we do. right. now. Consumption taxes eliminate
child subsidies.
P Brooks,
To further bolster the "private sales" issue, even then, some
private sales are covered under sales tax. I know that states are
different, but here in Washington, you can private sale your car
all you want, and you'll still pay taxes on it. You pay taxes when
you go get it registered. Tell the gum-chewer behind the counter
that you paid $1 for your car, and she'll pull a book out, and tell
you "The car you bought for $1 is valued at $10,997, so the taxes
due are..."
Like I said. This 'consumption tax' thing isn't wild new territory,
we've been doing it for decades and quite frankly, we're pretty
good at it.
The thing I haven't seen said clearly is that corporate tax
havens like the Caymans serve a very important buffering effect on
our government's erstwhile confiscation schemes (aka tax policies).
Given the option of having a small percent of a large pie or a
large percent of a tiny pie, the smart government will opt to take
less of more (i.e. lower taxes).
My nightmare scenario is one in which the global economy grows
large enough and offers US businesses sufficient low/no tax
incentives that they simply pack up and rely upon free-trade
agreements to support their N.A. markets or simply take their ball
and go to their new home. Once these sources of revenue dry up the
US gov will turn to the next sucker (middle class) for even a
bigger hunk of the megabucks beeded to fill the business tax
vacuum. Think urban flight/blight, but on a national scale.
I don't understand why we subsidize home mortgages with tax
relief, but don't do that for credit card or auto loan debts. Oh,
now I remember. The home mortgage is "good" debt. The bigger, the
better.
It's imperative that we encourage consumers to buy the products
that they already want to buy. Yeah, that's it. And while we're
making all sorts of sense, screw those rich people who rent and are
too cheap to spend their money on buying a house.
I'm in favor of an income taxes for a variety of reasons, but an income tax does not have to have child credits or deductions built into it. Similarly, there's no reason a consumption tax wouldn't have a similar refund "child credit" of some such. In fact, if we went to a consumption tax, I'd bet anyone that within two years there would be just such a credit, along with all sorts of other "credits" distributed by "refund" checks from the government.
"Ah, so we solve the inequality problem by going to the most
regressive system imaginable"
And who says inequality is a "problem" that has to be soloved in
the first place?
Or that it is any legitimate business of the federal government to
attempt it?
I don't see that anywhere in the list of ennumerated powers
delegated to the federal government in the text of the
Constitution.
If I have more money than you do, that isn't a "problem".
I earned it and you didn't.
And on this little taxing corporations contretemps, consumption tax fixes that, too. The CEO's and shareholders pay taxes when they go by their new Lexus and summer homes in the hamptons based on the profits they made from said corporations. Corporations aren't individuals, and they shouldn't pay "taxes". Their owners and operators should.
I'm in favor of an income taxes for a variety of reasons,
but an income tax does not have to have child credits or deductions
built into it. Similarly, there's no reason a consumption tax
wouldn't have a similar refund "child credit" of some
such.
Max Hats, a man can dream, can't he?
So what you want, is a system exactly like we have now, but better
people running it who won't be tempted to tweak it, you know, like
the system we have right now.
Max, no system is perfect, and no system is immune from policy
shenanegans. But in the case of a consumption tax, any credits are
purely after-the-fact, and would force the government to write a
cheque to you at the end of the year. Whereas now, the tax-credits
are deductions that you take when filling out your tax
return-- another fine, quaint and totally fucking retarded activity
that would be gone with a consumption tax.
Gilbert Martin,
The inequality I was referring to is having two tax systems, one
for the rich and powerful, one for everyone else.
I don't believe government should attempt to make everyone equally
wealthy. I do think government should enforce equal opportunity for
all.
"I don't believe government should attempt to make everyone
equally wealthy. I do think government should enforce equal
opportunity for all."
I think the federal government should confine itself to it's
ennumerated powers as the 10th Amendment requires it to do.
And those don't include anything about attempting to enforce "equal
opportunity" either.
There are no affirmative rights - to an equal opportunity or
anything else. There are only negative rights such as freedom of
speech, etc.
Basically, you have the right to be left alone by the government
unless you are actively doing something to harm someone else.
two tax systems, one for the rich and powerful, one for
everyone else.
How did this come to be?
Why should I expect the people who created that system, because it
benefits them politically and personally, to fix it?
Incentives matter, and the incentives which actually affect
legislation are not necessarily what you might prefer.
"Like I said. This 'consumption tax' thing isn't wild new
territory, we've been doing it for decades and quite frankly, we're
pretty good at it"
Consumption tax seems nifty, but in some ways I don't think it is
the panacea its supporters indicate.
For one thing, it is somewhat inequitable in the context it takes a
certain, base amount of "consumption" just to live at all. Poor guy
has to spend say, $20,000 a year just to eat and live in a shack,
and he only makes $20,000 a year to boot. Mr. Megamillions-per-year
elects to do the same thing, and live just as poor (Warren Buffett,
lets say), spending only $20,000 bucks a year on himself. End
result there is the marginal tax rate on the poor guy is much
higher on a per-dollar-earned basis than Mr. Rich Guy. That ain't a
flat-tax.
Also, you just wait for the social engineers to get ahold of
manipulating sales-taxes in a BIG way. They already do it. Smokes
are taxed more, food is tax-free, booze is turbo-taxed, etc. If
consumption taxes were the only game in town for the engineers,
descend on it they would with wild abandon. Soon, you would see
integrated debit cards that track your purchases (reverse
welfare!), so for some stuff you would pay less tax (for instance,
buy fewer then twenty gallons of gas a week, and you drop to a
lower "gas consumption bracket" because you're saving Earth!) and
other stuff more tax. Now the government might not know everything
I make, but more and more they will know everything I buy. Zero-sum
trade there in my opionion.
Soon moronic subsidies would show up. If I buy organic food I get a
"negative" consumption tax, so at the end of every year my refund
check shows up because I'm eating healthy. Unions would love a
purchase-subsidy for the stuff their shops make or sell...did
anyone say "healthcare?" Purchase-subsidy-palooza! How 'bout
education? Wheee!
At the end of the day, you're just trading an antelope for an ibex
changing out an income tax for a consumption tax...not a whole lot
of difference.
P Brooks,
I agree. That's why I favor laws that restore the incentive formula
to ensure government actually works for the people who own it and
not just for those who can afford to buy elections.
Paul-
You're in Washington? That explains a lot. How are Washington's
finances holding up? I am not looking for a "gotcha", just
genuinely curious.
As I recall, there is a sales tax only, no income tax, there. I
spent my first year of business school in Moscow, Idaho (University
of Idaho); there was a shiny new mall about two hundred yards from
the state line, and lots of people came from Pullman, and the rest
of western Washington, to avoid the sales taxes. Sound
familiar?
The Obama era, a mere three days old, has gotten so bizarre, that I can no longer tell the difference between the news and the spoofs. It's like reality decided to drop acid. Invade the Caymans? WTF? I need to start dropping acid myself just to keep up with current events!
THE URKOBOLD FINDS THIS DISCUSSION TO BE TOO TAXING. ALERT HIM WHEN THE THREAD TURNS TO WOMEN WITH GRAVITY-DEFYING BREASTS.
Goes right along with Rep. Rangel (D-NY) repeatedly trying to reintroduce the draft. Dems supporting the draft, Reps supporting confiscatory taxes. We do live in interesting times.
Why is it odd for a Democrat to support the draft? Democrats are egalitarian; a draft means even plutocrats' children might have to serve. Republicans are just fine with an underclass doing their dirty work for them.
Tony,
"Why is it odd for a Democrat to support the draft? Democrats are
egalitarian; a draft means even plutocrats' children might have to
serve. Republicans are just fine with an underclass doing their
dirty work for them."
Please tell me what you're smoking, because it must be some good
s***. Are you kidding? Being a "plutocrat" means you have lots of
money, lots of connections, and lots of strings you can pull. Now,
tell the rest of the class how these just might possibly affect the
acquisition of a draft deferment.
And, being an Air Force retiree and the father of a son and
daughter-in-law who are both in the Army, I f***ing resent your
implication our volunteer troops are from some knuckle-dragging
"underclass." Both of my children them are smart as hell,
well-educated, well-trained, and could kick your pasty ass in a
skinny minute--after, of course, I get a few shots in first as an
appetizer.
Capisce, paisan imbecile?
"It is true that America has the second highest corporate tax
rate of the 30 most wealthy countries of the Organization of
Economic Cooperation and Development. It is also true that America
takes in the fourth lowest corporate tax revenues because of
government favors and loopholes."-Tony
And yet you do not recognize that those truths are related? With a
more reasonable level of corporate tax there'd be less push for
making loopholes and exceptions. Exercising loopholes cost the
corporation money as well just less than th savings and directs
funds to inefficient uses.
A proliferation of people seeking tax shelters and loopholes is
evidence that the base tax rates are too high. This analogous to a
grocery store raising the price of a box of cereal to $7 and then
complaining that they can only move the product with coupons.
"It means, as T. Jefferson put it, "Taxes should be proportioned
to what may be annually spared by the individual." - Tony
That sounds nice and all, but who is supposed to judge that
proportion...non-arbitrarily? One can make those kind of
theoretical statements but we do not have the kind of
incorruptible, objective, philosopher-kings in the real world to
actually implement it. Which is why the real tax cade is a bloody,
indescipherable morass.
"The inequality I was referring to is having two tax systems,
one for the rich and powerful, one for everyone else."
The guy arguing in defense of the progressive income tax writes
that? Tony, you have one of the worst cases of cognitive dissonance
I have ever seen.
Wars stimulate the economy, and what our economy needs right now is stimulation! Yeah, yeah, stimulate it! Harder! HARDER!
"The inequality I was referring to is having two tax systems,
one for the rich and powerful, one for everyone else."
Well, if you're rich AND powerful, you're probably some
scum-sucking Washington reptile (I'm looking at you Ted Kennedy,
brain tumor or not). If you're just rich, you get screwed by the
tax code. In the butt.
"Why is it odd for a Democrat to support the draft? Democrats
are egalitarian; a draft means even plutocrats' children might have
to serve. Republicans are just fine with an underclass doing their
dirty work for them."
Could Tony be Lefiti? It makes sense. Lefiti would come up with an
excuse to defend any leftist cause, especially one that pisses off
libertarians (like the draft).
"There are no affirmative rights - to an equal opportunity or
anything else. There are only negative rights such as freedom of
speech, etc.
Basically, you have the right to be left alone by the government
unless you are actively doing something to harm someone
else."
But Gil, we're in the Age of Obama now. The age of the Hope and the
Change. So get around the fire with us and join hands and sing the
great hymns of equality and the collective spirit. Or else.
MarkJ,
I'm certain there are bright and brilliant people serving in the
armed forces. But I'm also certain that, on the whole, the armed
forces are comprised of people for whom it's the most prudent
economic option. What I object to, what I find offensive, is
wealthy, detached people making decisions about war and peace when
they, themselves, have nothing to sacrifice for it. Sending poor
southerners off to be carbomb fodder in an illegal war is not
something to celebrate.
MJ,
I'm in favor of taxes not being a burden on anyone. When you can
pay fewer taxes per dollar when you're rich and connected than
someone who is poor and can barely afford what he's forced to pay,
something's wrong. I just wish libertarians would spend as much
time being angry about rich welfare as they do poor welfare.
Tony,
I wish liberals would spend some time thinking about how and why
their policies lead to results they supposedly disapprove of.
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