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Center for Freedom and Prosperity's E-mail Update 1) CF&P Foundation Study Highlights Economic Benefits of Competitive Shipping Market 2) Maritime Media Highlight CF&P Foundation's Shipping Study 4) Dan Mitchell: Time for tax reform 5) High tax rates lead to tax evasion 6) Worldwide taxation hurts US companies 7) 2003 tax cuts generate impressive results 8) Richard Rahn: Kerry's plan to make America more like France 10) Bruce Bartlett: Europe's pathetic economy 11) OECD launches new attack on fiscal sovereignty 12) Jack Kemp: You don't make the poor rich by making the rich poor 13) Economic lessons for politicians (and other dummies) 14) The perils of income redistribution 15) New report shows that money laundering not associated with low-tax countries 16) World Bank squanders money 17) CF&P News Clips
1) CF&P Foundation Study Highlights Economic Benefits of Competitive Shipping Market, Condemns OECD/ITF Attack Against Open Registries The Center for Freedom and Prosperity Foundation recently released a study analyzing the impact of open registries on the global shipping market. These registries, maintained by about 30 countries, are open to shipowners from all nations and the study finds that they have boosted international trade and the world economy by reducing shipping costs and increasing efficiency in the industry. "Open registries have been particularly beneficial to the United States, which is the world's largest exporter and importer," said Andrew Quinlan, president of the CF&P Foundation. "Moreover," he added, "open registries have good safety and security records - features that are very important to US policy makers." CF&P Foundation's latest Prosperitas, "The Threat to Global Shipping from Unions and High-Tax Politicians: Restrictions on Open Registries Would Increase Consumer Prices and Boost Cost of Government," was written by Heritage Foundation Senior Fellow Daniel Mitchell. Commenting on his study, Mitchell stated, "Unlike monopolistic national registries, open registries use a market-based model. And since they compete with each other to attract ships, this has led to better service for shipowners and more rational tax and regulatory systems." [Link to full statement on the study below:] CF&P Foundation Study Press Statement: Link to full paper: Link to PDF version of paper:
2) Maritime Media Highlight CF&P Foundation's Shipping Study Tax-News.com August 31, 2004, Tax-News.com, by Jeremy Hetherington-Gore, Open Shipping Registries Best, Says US Report Maritime Global Net Newsletter The report, "The Threat to Global Shipping from Unions and High-Tax Politicians" says restrictions on open registries would "increase consumer prices and boost cost of government". While shipowner organisations are likely to agree with many of the basic arguments the lack of any reference to the recently formed International Bargaining Forum and the pragmatic approach the ITF adopts in practice could lead to a reluctance within the industry to become too closely associated with this report. [Link to full article below:] August 19, 2004, Maritime Global Net Newsletter, Report Defends FOCS Against ITF and OECD Lloyd's List It takes the line that open registries compete to offer shipowners the best tax and regulatory environment combined with efficient service. This reduces costs in the shipping industry, "with consumers reaping the lion's share of the benefit". Yet, despite such advantages, FoCs are under attack from two quarters. The first is the Organisation for Economic Co-operation and Development, "acting on behalf of high-tax governments that maintain monopolistic 'national registries' ". Shipowners abandon them "to escape burdensome red tape and onerous taxation". The second adversary is the International Transport Workers' Federation, which Dr Mitchell accuses of campaigning against FoCs to bolster its political muscle. Andrew Quinlan, president of the Center for Freedom and Prosperity Foundation, adds: "Open registries have been particularly beneficial to the US, which is the world's largest importer and exporter. Moreover, open registries have good safety and security records, features that are very important to US policymakers." [Link to full article below:] August 23 2004, Lloyd's List, By David Osler, FoCs find a friend in US think tank
3) Dan Mitchell to speak in Oxford and Cambridge on Tax Competition and Financial Privacy ~ September 6 & 9, 2004 Next week, Dan Mitchell of the Heritage Foundation will participate in both the Oxford Offshore Symposium and the Cambridge International Symposium on Economic Crime. He will give a dinner address in Oxford on September 6th on the "Economics of Tax Competition" and a September 9th morning panel presentation on "The Patriot Act and Beyond" in Cambridge. The 14th Oxford Offshore Symposium The 22nd Cambridge International Symposium on Economic Crime
4) Dan Mitchell: Time for tax reform President Bush and many Republican leaders are hinting that the time has come for fundamental tax reform. Dan Mitchell explains why either a flat tax or a national sales tax would be a big improvement over the corrupt internal revenue code. [Excerpt from Dan Mitchell's article:] Even people who disagree about tax cuts usually agree that our tax system is a mess. It should be repealed and replaced with a system that treats all taxpayers fairly and equally. ...Two great ideas for achieving this goal are on the table - the flat tax and the national sales tax. They may seem different, but the flat tax and the sales tax are different sides of the same coin: The flat tax takes a small slice of your income as it's earned; the sales tax takes a small slice of your income as it's spent. ...this debate should include potential pitfalls. For instance, if we adopt a flat tax, how can we ensure that politicians don't create new loopholes? And if we adopt a sales tax, how do we make sure the politicians don't pull a bait-and-switch, implementing a sales tax but then conveniently "forgetting" to repeal the income tax? Many European nations have adopted a form of national sales tax, but none have eliminated their income-tax systems. As a result, national sales taxes have been used to finance a big expansion in the size of government - which helps to explain why so many European nations are economically stagnant. ...Special-interest groups will fight to protect the loopholes and shelters they have placed in the current system. But this doesn't mean the battle can't be won. Nobody thought President Reagan would be able to cut America's top tax rate from 70 percent to 28 percent. Nobody predicted 15 years ago that the Soviet Union would disappear and be replaced by a more democratic Russia with a 13 percent flat tax. [Link to full article below:] August 9, 2004, FoxNews.com, By Daniel J. Mitchell, Two Choices for Tax Reform August 13, 2004, The Market Center Blog, Time for tax reform. August 10, 2004, Reuters, Bush Says National Sales Tax Worth Considering Link to more Market Center Blog entries on taxation:
5) High tax rates lead to tax evasion. In a stunning admission, the European Commission has produced a report acknowledging that rampant tax evasion in Europe is largely the result of confiscatory tax rates. Sadly, this report is not likely to generate tax reductions and tax reform, but it is still noteworthy that somebody in Brussels was willing to state the truth. [Excerpt from the Wall Street Journal:] Even though about 50% of the officially measured gross domestic product in France, Germany and Italy goes through the state coffers, the three find it increasingly difficult to pay their bills. It has long been argued that the high tax rates in these countries, particularly on the margins, simply stall economic growth and depress tax revenues rather than boosting them. ...High taxation has another effect -- it drives a significant part of the economy underground, further reducing state receipts. A European Commission report this month shows a strong correlation between high income and social taxes and the magnitude of the black market economy. "This problem can create a vicious cycle, as the state is likely to increase taxes to compensate for the loss of income. However, as the tax burden increases, the incentive to perform and hire undeclared work also increases," says the report. Doubters of supply-side economics please take note. [Link to full report below] July 29, 2004, The Wall Street Journal, Review & Outlook, Europe's Black Economy July 30, 2004, The Market Center Blog, High tax rates lead to tax evasion.
6) Worldwide taxation hurts US companies Herman Bouma of Buchanan Ingersoll explains for the Bureau of National Affairs that American-chartered companies are put at a competitive disadvantage because they are forced to pay a second layer of tax to the IRS on income earned in other nations. This policy, he explains, means that the American government treats US companies worse than foreign companies. [Excerpt from Herman Bouma's article:] Congress needs to ask itself, if a start-up business venture can easily incorporate abroad (e.g., in Australia, Bermuda, or the Netherlands) and avoid the onerous U.S. tax rules for income earned outside the United States (while still being listed on a U.S. stock exchange), why impose these onerous rules on U.S. corporations? What's the point? You only end up hitting U.S. corporations that are trapped as U.S. corporations, and you only extract more revenue from them until you have killed the proverbial goose, i.e., until they go out of business or are acquired by foreign corporations. Why does Congress have no compunction about imposing onerous tax rules on U.S. corporations? Why discriminate against U.S. corporations? Why not treat U.S. and foreign corporations the same? [Link to full article below:] August 17, 2004, Bureau of National Affairs, By Herman B. Bouma, If Congress Ruled California: The Consequences of Taxing Worldwide Income August 19, 2004, The Market Center Blog, Worldwide taxation hurts US companies. July 19. 2004, The Royal Gazette, US House brings more pressure on offshore tax shelters
7) 2003 tax cuts generate impressive results The Wall Street Journal explains that the lower tax rates on investment included in last year's tax bill - combined with the fact that the 2003 legislation also accelerated the income tax rate reductions from the 2001 bill - have helped boost economic performance. The editorial also notes that the President's track record on other economic issues is not nearly as impressive. [Excerpt from Wall Street Journal article:] It was only when the 2003 tax cuts passed Congress in mid-year that the expansion really gained steam. Those tax cuts are criticized for favoring the rich. In fact, they lowered the burden for all, although because the rich pay the most taxes it is inevitable that in dollar terms they enjoyed the biggest break. The child tax credit took many lower-income workers off the tax rolls entirely. The elimination of the marriage penalty, increased college tuition deductions and higher retirement contribution limits all helped the middle class. But in retrospect, it's clear that the largest economic boost came from cutting the tax on capital. By reducing the bite on dividends and capital gains to 15% from as high as 38.6%, investors' calculations of the return necessary to justify any given level of risk was immediately reduced. Accelerating the marginal rate cuts to take place immediately also lifted the incentive to invest. The stock market rose and balance sheets improved. Not surprisingly, all of this has led to more investment. It's scary to think what the economy would look like now without the tax cut. ...Mr. Bush's economic choices have not been perfect. He has failed to expend any political capital to restrain the spending impulses of Congress. Sarbanes-Oxley may also have swung the regulation pendulum too far, and tardy telecom reform prolonged the slump in that industry. The steel tariffs were a blunder of the first order... [Link to full article below:] September 1, 2004, The Wall Street Journal, Review & Outlook, The Anti-Hoover September 1, 2004, The Market Center Blog, 2003 tax cuts generate impressive results
8) Richard Rahn: Kerry's plan to make America more like France Richard Rahn explain in the Washington Times that Senator Kerry will reduce economic growth if he succeeds in restricting trade and increasing the cost of productive behavior. Dr. Rahn speculates whether Kerry doesn't understand economics or whether he simply is willing to impoverish people for political gain. [Excerpt from Dr. Rahn's op-ed:] Those politicians who propose policies that would restrict trade, increase taxes on capital and/or labor; and increase costly regulations on labor and business are in effect proposing policies to reduce economic and job growth. Unfortunately, Mr. Kerry proposes to do all of the above. He wants to put restrictions on both current and future trade agreements — and each one of these would cause a one-time drop in baseline economic growth and a permanently reduced economic level. His proposals to "tax the rich" would in fact increase taxes on capital — i.e., capital gains, dividends and savings, all of which will reduce the capital stock. (He has argued that the negatives of his tax increase proposals will be offset by a drop in the deficit, but his new spending proposals exceed many times any possible revenue increase from his tax package.) Also, his proposals to raise the minimum wage and impose other restrictions on worker employment will only reduce jobs and real wages. Such policies are not compassionate but in fact are hurtful. Either Mr. Kerry does not or chooses not to understand economic reality. [Link to full article below:] August 26, 2004, The Market Center Blog, The Washington Times, By Richard W. Rahn, Kerry economically scary? August 26, 2004, Kerry's plan to make America more like France.
Techcentralstation.com, EU Observer and the Wall Street Journal all offer optimistic outlooks for Europe's future. Free market reformers in Eastern Europe already are changing the debate in Brussels and newly-announced European Commission members favor market liberalization. [Excerpt from Techcentralstation.com:] Politicians like Estonia's Prime Minister Juhan Parts, Slovakia's Prime Minister Mikulas Dzurinda, Hungary's once and future Prime Minister Victor Orban and Poland's next Prime Minister Jan Rokita are at the forefront of a group of young politicians that will try to bring Eastern Europe's revolutionary free-market conservative beliefs to Brussels. Together, they will be in prime position to push Europe's agenda in a different direction - less Sweden, more Texas. In the field of economic policy-making, Eastern Europe's accession to the EU's internal market is already leading to previously unthinkable results. The threat of further outsourcing of manufacturing jobs to Eastern Europe has put the return to a 40-hour working week (or 36 hours in France) firmly on the agenda in Western Europe. Equally firmly off the agenda are subjects like tax harmonization and further labor market regulation. [Link to full article below:] [Excerpt from EU Observer:] The new European Commission is set to have a distinctly liberal [in the pro-market European sense of the word] angle as the three of the top economic posts have gone to people who favour market liberalisation. Competition, which is arguably the biggest portfolio in the European Commission, will be handled by the Dutch Neelie Kroes who comes from the free market liberal party, VVD, in the Netherlands. Meanwhile, the Briton Peter Mandelson will take on the trade portfolio. A close ally of UK prime minister Tony Blair, Mr Mandelson is also a strong proponent of free trade and is a former trade minister. Responsible for the internal market and financial services is the Irishman Charlie McCreevy. He has been finance minister in Ireland for seven years and is known as a free marketer. Another interesting appointment is of Ingrida Udre to look after taxation - she comes from Latvia, a country with very low corporate tax rates. These appointments are likely to make it harder for France and Germany to push their traditionally more protectionist agenda. [Link to full article below:] [Excerpt from Wall Street Journal:] ...as Mr. Barroso read the names of the Commissioners he had chosen for the key portfolios, it became clear that the center of gravity has shifted: the Franco-German axis might still exist but it is no longer calling the shots. Almost none of the duo's central demands had been met while all important economic positions went to avowed free-marketers. ...Trade went to Britain's Peter Mandelson and the important internal market position went to Ireland's former Finance Minister Charlie McCreevy. What better man to tear down the last obstacles to free trade and the free movement of capital and people in Europe than the man whose supply-side policies helped steer Ireland toward 8% growth rates? Taxation was split off from internal markets portfolio and given to Latvia's Ingrida Udre. Mr. Barroso could have hardly sent a clearer message to France and Berlin that they are wasting everybody's time with their calls for a European minimum tax to stop tax competition from the East. Latvia adopted a 25% flat tax almost ten years ago and experienced economic growth rates averaging over 6% during the last five years. [Link to full article below:] August 10, 2004, Tech Central Station, By Joshua Livestro, Knock, Knock, Knockin' on Brussels' Door August 13, 2004, EU Observer, by Honor Mahony, Free marketers in top commission posts August 13, 2004, The Wall Street Journal, Review & Outlook, Welcome to New Europe August 13, 2004, The Market Center Blog, Hope for Europe, Part II. August 11, 2004, The Market Center Blog, Hope for Europe.
10) Bruce Bartlett: Europe's pathetic economy Bruce Bartlett has a comprehensive column showing how bad economic policy is causing Europe to fall way behind the United States. Living standards in Europe are akin to those in America's poorest state. In short, Europe taxes productive activity and subsidizes sloth. [Excerpt from Bruce Bartlrett's column] Europeans produce no more per year than Americans did 20 years ago. And they are not catching up. According to the Bank for International Settlements in Switzerland, the productivity gap between the United States and Europe is actually widening. In the Euro area as a whole, workers were 86 percent as productive as American workers in 1995. In 2003, this fell to 84 percent. As a consequence, living standards are much lower in Europe than most Americans imagine. This fact is highlighted in a new study by the Swedish think tank Timbro. For example, it notes that the average poor family here has 25 percent more living space than the average European. Looking at all American households, we have about twice as much space: 1,875 square feet here versus 976.5 square feet in Europe. On average, Europeans only live about as well as those in the poorest American state, Mississippi. ...Europeans seem to get sick a lot more than Americans. According to a July 25 report in The New York Times, on an average day 25 percent of Norway's workers call in sick. A 2002 study in Sweden found that the average worker there took more than 30 sick days per year. Makes you wonder just how good their health care systems really are. As a consequence, aggregate hours worked are much lower in Europe than in the United States. According to a new report from the Organization for Economic Cooperation and Development in Paris, last year the average American worked 1,792 hours. By contrast, the average Frenchman worked just 1,453 hours and the average German worked only 1,446 hours. Twenty-five years ago, annual hours worked in Europe were much closer to those here. ...neither the OECD nor the IMF has any real explanation for why Europeans take so much leisure time. However, a new study by economist Edward Prescott of the Federal Reserve Bank of Minneapolis provides the answer. He says that Europe's higher taxes explain almost all the difference in labor force participation rates between Europe and here. He notes that when European tax levels were comparable to those here, work hours were similar. But as Europe's taxes have risen, workers responded by working less. Consequently, tax cuts in Europe would raise labor supplies, increase output and raise the standard of living. For example, if France reduced its tax burden from 60 percent of GDP to 40 percent, the average Frenchman would be able to consume 19 percent more over his lifetime than he does now. This is a very large impact. In short, Europeans don't work because it just doesn't pay to work after the government takes its cut. And because welfare benefits are so high, the cost of not working is low. [Link to full article below:] August 10, 2004, Townhall.com, by Bruce Bartlett, The grass is not greener August 10, 2004, The Market Center Blog, Europe's pathetic economy. Additional EU blogs and articles: August 30, 2004, The Market Center Blog, Europe's misguided economic policy. August 26, 2004, The Market Center Blog, Another reason for Europe's pathetic performance. August 24, 2004, The Market Center Blog, EU uses any excuse to fight against lower taxes. August 18, 2004, Tax-News.com, by Ulrika Lomas, France Suggests EU-Wide Investment Tax Amnesty August 3, 2004, The Market Center Blog, Europeans choose more leisure, but who is paying the bills? July 30, 2004, The Market Center Blog, New study highlights Europe's dismal future. July 23, 2004, The Royal Gazette, By Matthew Taylor, Bermuda avoids EU tax legislation, for now Link to more Market Center Blog entries on the EU:
11) OECD launches new attack on fiscal sovereignty. In hopes of jump-starting its faltering agenda of fiscal imperialism, the Organization for Economic Cooperation and Development has altered a provision of its model tax treaty. The tax-free bureaucrats have proposed that laws regarding financial privacy and domestic collection requirements should not hinder a government's attempt to double-tax income earned in other nations. Fortunately, this is a rather toothless effort by the OECD since nations will simply choose not to apply this new provision. [Excerpt from the Bureau of National Affairs:] The Organization for Economic Cooperation and Development's Committee on Fiscal Affairs has agreed on new provisions for the exchange of information between national tax authorities that would prevent bank secrecy or domestic tax interests from being used as a basis to refuse to share information, the group announced July 23. The OECD said the changes are outlined in the first major update of Article 26 under the OECD Model Tax Convention since 1977. ...In commentary to the revised Article 26, Austria, Belgium, and Luxembourg all reserved the right not to include the bank secrecy paragraph in their tax conventions, while Switzerland said it has reserved its position on this issue. Austria said it will authorize the exchange of information held by banks or other financial institutions for criminal investigations of tax fraud, however. Switzerland said its reservation about the bank secrecy provision would not apply in cases involving fraud that would result in imprisonment in both contracting states. [Link to full article below:] July 27, 2004, Bureau of National Affairs, By Alison Bennett, Tax Information Exchange Provisions Revised in OECD's Model Convention July 28, 2004, The Market Center Blog, OECD launches new attack on fiscal sovereignty.
12) Jack Kemp: You don't make the poor rich by making the rich poor Jack Kemp explains in Townhall.com why John Kerry's class warfare tax policy is so misguided. Kerry - and many other politicians from both parties - fail to realize that high tax rate discourage productive behavior and therefore have a negative impact on growth. Moreover, Kerry does not seem to understand that raising taxes on the "rich" will make it hard for others to get rich, thus undermining the income mobility that is one of America's great strengths. [Excerpt from Jack Kemp's column:] I was glad to hear Sen. John Kerry quote Abraham Lincoln as he accepted the Democratic nomination, but he did not read Lincoln far enough. Lincoln famously said, "I don't believe in a law to prevent a man from getting rich; it would do more harm than good." ...The Kerry-Edwards economic agenda is now clear: They see the American system as a zero-sum game. ...Not only left-leaning Democrats, but too many Republicans don't understand the difference between tax rates and tax revenue. As John F. Kennedy reminded us in 1962, "It is a paradoxical truth that tax rates are too high and tax revenues too low, and the soundest way to raise revenues in the long run is to cut rates now." ...As secretary of Housing and Urban Development, I spent a lot of time talking to people who lived in public housing. I never heard one person say they want to make the rich poor; they only want the opportunity to get ahead and get out of poverty. High tax rates don't hurt the rich, who can shelter their income; high tax rates just keep the poor in poverty. ...Kerry makes an age-old mistake of treating workers' station in life as static. That is exactly wrong. A worker earning "middle-class" income today may be in the top 1 percent tomorrow. Researchers at the Urban Institute found that anywhere from 25 percent to 40 percent of Americans move from one income quintile to another in a single year. Over longer periods the shifts are even larger: about 45 percent over five years and 60 percent over average 15-year periods. Today's laborer is tomorrow's investor, owner and job creator. [Link to full article below:] August 2, 2004, Townhall.com, by Jack Kemp, Weapons of class warfare August 3, 2004, The Market Center Blog, You don't make the poor rich by making the rich poor.
13) Economic lessons for politicians (and other dummies) The invaluable Walter Williams explains in his Townhall.com column that there is no free lunch. Sadly, politicians always focus on the benefits of intervention and never calculate the costs. This may be politically smart since costs tend to be hidden and spread over a large population, but it certainly does not promote good policy. In the free market, by contrast, people get rich by providing goods and services other people genuinely desire. [Excerpt from Dr. Williams' column:] How many times have we heard "free tuition," "free health care," and free you-name-it? If a particular good or service is truly free, we can have as much of it as we want without the sacrifice of other goods or services. Take a "free" library; is it really free? The answer is no. Had the library not been built, that $50 million could have purchased something else. That something else sacrificed is the cost of the library. While users of the library might pay a zero price, zero price and free are not one and the same. So when politicians talk about providing something free, ask them to identify the beneficent Santa Claus or tooth fairy. It's popular to condemn greed, but it's greed that gets wonderful things done. When I say greed, I don't mean stealing, fraud, misrepresentation or other forms of dishonesty. I mean people trying to get as much as they can for themselves. We don't give second thought to the many wonderful things others do for us. Detroit assembly-line workers get up at the crack of dawn to produce the car that you enjoy. Farm workers toil in the blazing sun gathering grapes for our wine. Snowplow drivers brave blizzards just so we can have access to our roads. Do you think these people make these personal sacrifices because they care about us? My bet is that they don't give a hoot. Instead, they along with their bosses do these wonderful things for us because they want more for themselves. [Link to full article below:] August 11, 2004, Townhall.com, by Walter E. Williams, Economics 101 August 11, 2004, The Market Center Blog, Economic lessons for politicians (and other dummies).
14) The perils of income redistribution Kevin Hassett of the American Enterprise Institute explains that "compassion" is a dangerous yardstick for political decision-making. It creates a slippery slope that leads down the "Road to Serfdom" described by Nobel Laureate Friedrich Hayek. [Excerpt from Dr. Hassett's column:] Hayek recognized that the problem of compassion is that it can be aroused in voters and then abused by socialist opportunists to increase the size of government without restraint. Since life will always deliver pain and injustice, one can always find problems that the government can in principle cure. This dynamic path will lead, he argues, to a government that is anything but compassionate in effect. Citizens will be so bound to the whims of bureaucrats and so heavily taxed that effort will wane, as will welfare [as defined by society's overall well-being]. One need not look much farther than France or Germany today to see how desperate the economic circumstances can become when a society becomes too "compassionate." ... [Kerry's] claim is that higher taxes on the wealthy can finance generous improvements in government programs for the middle class. The philosophy of this view is quite radical, as it empowers government to seize without limit the property of individuals higher up in the income distribution if the resources are used to benefit those lower down. At a recent event at the American Enterprise Institute, I pushed one Democratic economist on this point. If marginal tax rates of 39.6 percent are acceptable because of social justice, why not go higher? The individual responded that Wesley Clark had recently remarked favorably on the seventy percent tax rates of a few decades ago. Senator Kerry's philosophy appears to admit the same slippery slope. This confiscatory power is exactly what those wary of the road to serfdom are afraid of. They argue against such policies for two reasons. The high marginal tax rates will encourage capitalists to take their business abroad, reducing the welfare of those who government was attempting to assist. Second, the coercive seizure of too much of an individual's property conflicts with his very freedom. [Link to full article below:] September 1, 2004, Tech Central Station, By Kevin Hassett, Compassionate Concerns September 1, 2004, The Market Center Blog, The perils of income redistribution.
15) New report shows that money laundering not associated with low-tax countries The latest study from the Financial Crimes Enforcement Network demonstrates that criminals do not rely on so-called tax havens to launder dirty money. The report also indicates that it is almost impossible to stop money laundering, which is why law enforcement resources should be focused on catching and prosecuting people for real crimes rather than imposing huge regulatory burdens that have very little practical impact. [Excerpt from The Bureau of National Affairs:] Money laundering through foreign shell banks and shell companies, automated teller machines, and fraudulent consumer loans are key areas of concern in the Financial Crimes Enforcement Network's latest review of trends in suspicious activity reports, released Aug. 16 (SAR Activity Review). FinCEN, the Treasury Department's anti-money laundering unit, said information filed along with suspicious activity reports identified specific Eastern European countries as homes for shell firms, including Armenia, Belarus, Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Georgia, Greece, Kazakhstan, Latvia, Lithuania, Moldova, Poland, Romania, Russia, Slovenia, Turkey, Turkmenistan, Ukraine, Uzbekistan, and Yugoslavia. ...Money launderers--who nowadays are also seen as potential terror financiers--use a wide variety of ways to move money outside the law, the FinCEN review found. One method is food stamp fraud using electronic benefit transfer cards. Some food stamp recipients sell their cards for cash, which makes its way to the retailers' bank accounts via an automated clearing house transaction. The Department of Agriculture's Food and Nutrition Service estimates that some $395 million of food benefits are diverted each year from their intended purpose through food stamp "trafficking and associated money laundering activities." [Link to full article below:] August 17, 2004, Bureau of National Affairs, By Marcia Kass, Foreign Shell Firms, Eastern Europe, ATMs, Loan Fraud Stressed in SAR Review August 19, 2004, The Market Center Blog, New report shows that money laundering not associated with low-tax countries.
16) World Bank squanders money. The New York Times reports on the utter failure of the World Bank to generate positive results after spending tens of billions of dollars: [Excerpt from the New York Times:] Wealthy nations and international organizations, including the World Bank, spend more than $55 billion annually to better the lot of the world's 2.7 billion poor people. Yet they have scant evidence that the myriad projects they finance have made any real difference, many economists say. ...A recent in-house review of bank projects during the past four to five years found that only 2 percent had been properly evaluated for whether they made a difference ... none of the studies were rigorous enough to measure whether the initiatives made a difference, except for one that found it increased enrollment by a disappointing 1.3 percent. "The World Bank spent more than a billion dollars without knowing why they were doing what they were doing - that's the tragedy,'' said Abhijit Banerjee, an M.I.T. economics professor and co-founder of the Poverty Action Lab. [Link to full article below:] July 28, 2004, The New York Times, By Celia Dugger, World Bank Challenged: Are Poor Really Helped? Saturday, July 31, 2004, World Bank squanders money. Additional Blogs and News Clips: August 5, 2004, The Market Center Blog, IMF urges more spending and more taxes in the U.S. August 1, 2004, The Market Center Blog, IMF admits to subsidizing Argentine crisis. July 31, 2004, The Market Center Blog, World Bank squanders money. July 29, 2004, The Market Center Blog, World Bank subsidizes dictatorships.
August 12, 2004, The Economist, Doing business in dangerous places: You don't have to be mad to work here August 9, 2004, Tax-News.com, by Amanda Banks, Bahamas Not Prepared To Enter Into Further TIEAs August 6, 2004, Caribbean Net News, Another EU directive may impact Caribbean offshore business August 5, 2004, The Economist, After Babel, a new common tongue August 4, 2004, Reuters, By Laura MacInnis, Foreigners own half US debt, tipping point unclear August 4, 2004, LawAndTax-News.com, by Robin Pilgrim, UK Lawyers Angered By Trust Proposals In EU Money Laundering Directive August 2, 2004, Weekly Standard, by Noemie Emery, John Kerry Is Different from You and Me August 2004, Center for Individual Freedom, Global Taxes Are Back, Watch Your Wallet, July 28, 2004, The Washington Times, By Shaun Waterman (UPI), 9/11 panel proposes liberties watchdog July 28, 2004, Cato Institute, by James A. Dorn, Hong Kong: World's Freest Economy July 27, 2004, Tax-News.com, by Ulrika Lomas, OECD Releases New Exchange Of Tax Information Guidelines July 27, 2004, The Washington Times, By Paul M. Weyrich/David Keene, Guarding liberties July 27, 2004, Tax-News.com, by Jason Gorringe, UK's Black Economy Deprives Government Of £40 Billion In Revenues July 26, 2004, Reason Online, by John Berlau, John Kerry's Monstrous Record on Civil Liberties: The Man from Beacon Hill's "New War" on the Constitution July 25, 2004, Washington Post, By David J. Rothkopf, Just As Scary As Terror: Anyone Seen Our Economic Policy? July 24, 2004, The Telegraph, Meanwhile, welcome to the World Mk II: Who needs an island when you can buy a home on a luxury, globe-trotting liner? Saul Brookfield goes aboard July 23, 2004, OECD, OECD Releases New Provisions for Exchange of Information Between Tax Authorities May 30 2001, Silicon.com, Echelon: It can see us, but not as clearly as we thought
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