The Babe Theory Of Political Movements.
Mar. 21, 2005 11:50 AM
Iran's Sham Election In Houston.
June 20, 2005 5:36 AM
Yes, Kanye, Bush Does Care.
Oct. 31, 2005 12:41 AM
Health Care vs. Wealth Care.
Nov. 23, 2005 3:28 PM
Americans Voting With Their Feet.
Nov. 30, 2005 1:33 PM
Idea Majorities Matter.
May 12, 2006 6:15 PM
Twilight Zone Economics.
Oct. 17, 2006 12:30 AM
The "Shrinking" Middle Class.
Dec. 13, 2006 1:01 PM
From Ashes, GOP Opportunities.
Dec. 18, 2006 6:37 PM
Battle Between Entitlements & Pork.
Dec. 21, 2006 12:31 PM
Let Economic Freedom Reign.
Dec. 22, 2006 10:22 PM
Biggest Health Care Moment In Decades.
July 25, 2007 4:32 PM
Unions Antithetical to Liberty.
May 28, 2008 11:12 PM
Right To Work States Rock.
June 9, 2008 12:25 PM
Social Security Reform Thursday.
March 13, 2008
Caption Contest: Enter Today!
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The Carnival Of Classiness.
Mar. 14, 2006
Quotational Therapy: Obama.
Apr. 4, 2008
Mainstream Melee: Wolfowitz.
May 19, 2007
Pundit Roundtable: Leaks.
July 9, 2006
A WILLisms.com(ic), by Ken McCracken
July 14, 2006
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International Tax Competition: Capital & People Go Where They Are Treated Well.
Some interesting actions on tax policy from around the world.
Sweden looking to rid itself of its unfair "wealth tax" that is driving some its best and brightest out of the country:
STOCKHOLM, Sweden -- Maybe the next Bjorn Borg won't feel compelled to move to Monaco now that Sweden plans to scrap a decades-old "wealth" tax that imposes levies on assets -- not just on income.
So, yeah. Money flows to where it is treated well. Countries around the world have begun to understand this, for the most part.
It's why so many countries in recent years have adopted flatter, lower taxes, and dropped some of their protectionist tariffs and such. Not surprisingly, these countries, like Ireland and Iceland, are flourishing economically.
The Czech Republic is now proposing a flat tax:
The Czech government has announced a raft of major tax reform plans, which include a flat tax on personal income, a significant reduction in tax on corporate income, and changes to the value-added tax regime.
And India is looking seriously at major tax reform.
Dubai has gone from a desert wasteland to the most exciting city on the planet, not on the strength of oil, but because it is now a low-tax financial hub.
Even the UK is cutting its corporate tax rates, if only slightly.
Even in Germany there are steps in the lower-tax direction, especially on personal and corporate tax rates (being cut roughly 10 points).
Hong Kong and Singapore have enjoyed rapid growth and now rank among the world's wealthiest jurisdictions -- thanks, in part, to their low tax rates and open markets. But no good deed goes unpunished. Today, both thriving jurisdictions face possible economic sanctions courtesy of the U.S. Congress.
This is just mindnumbingly stupid.
Meanwhile, as America's political class has developed a phobia of doing anything that could be perceived as beneficial for the evil corporations, and other countries have aggressively lowered their business taxes, the United States suddenly has the second-highest corporate income taxes in the industrialized world.
Tax competition around the world has yielded some highly illuminating results, and we ignore those results at our own economic peril. Low-tax countries are just plain doing better economically than high-tax countries. And you can even see the results of tax competition within the United States itself. Capital and people are fleeing high tax states and moving to low tax states.
It's so obvious, yet we still have these economically illiterate knuckledraggers like Dorgan and Levin, completely beholden to the dying labor unions, with their protectionism, isolationism, and socialism, now in power in the Senate.
The United States still has many advantages, economically-speaking. According to the Index of Economic Freedom, however, America is below average in two important categories:
The two low points in an otherwise fantastic report card:
Fiscal Freedom - 79.4%
Our advantages are being undermined by our burdensome tax policies, and now our very economy is threatened by our new Congress.
It's time to throw Dorgan (and Conrad, while we're at it) out of office and back into the frozen, desolate streets of Bismarck or Fargo or wherever he is from. It's time to elect Senators in every allegedly-Republican state who, even if they are not pure free market conservatives, are are least not beholden to the worst kind of long-discredited mercantilist labor union hocus-pocus now so rampant in Congress.
When Democrats are in charge, they clearly have no problem letting the lunatics run the show. When Republicans are in charge, you may not necessarily have ideologically or philosophically "pure" conservatives in committee chairmanships, but at least there's a buffer that keeps clowns like Levin and Dorgan from getting anywhere with their "low tax nation blacklists" and such. And-- occasionally-- when the GOP is in power, you'll even get someone like Paul Ryan or Mike Pence fighting for and succeeding in advancing economic liberty.
In 2006, a lot of Republican-leaning voters sat out or even voted for Democrats, to send a message. Now we face the end of the "free trade era" in America. We face one of the largest tax increases in world history amidst a climate of global economic competition-- and global tax cuts. We face the ironically named Employee Free Choice Act (EFCA). We now face more pork than ever, with less accountability, and no entitlement reform anywhere on or over the horizon. Forget the tort reform movement. Forget property rights advances. Forget deregulation and privatization. Forget fixing SARBOX's excesses. Forget all sorts of issues where Republicans were making slow-but-steady advances before this last election.
Just forget about it. Jimmy Hoffa is still apparently very much alive and is now in charge of America's economic policy.
No, but there are no differences between the parties or anything silly like that. Republicans are just as bad as Democrats.
For those who sat out in 2006 to send a message, consider for a moment how that message has actually been received and interpreted by the left-leaning establishment media and the Democrats now in power.
All they've heard is, "we want left-wing economics. Please, we beg of you, give us left-wing economics!"
Posted by Will Franklin · 5 April 2007 02:56 PM
What we see is a new global mobility that used to be reserved only for super rich folks. Within the developed world, it is relatively easy for the affluent and educated to work where they choose, regardless of country of origin. Things like the EU and H1-B visas for tech workers, etc.
There is a competition for workers as well as capital and smart leaders recognize that the single biggest reason people choose to live, work, locate a business or start a business in one location as opposed to another is a term called "profit motive".
Point being that capital will flow into businesses and areas and counties and states and countries that offer the best return on investment. Workers want to live where they get the most return, especially workers that have skills that are in demand. Wealthy folks can live anywhere and as global communication improves and almost every major city has extensive broadband connecting the entire world, people can work remotely and live where they choose.
Case in point--my original boss and mentor is a 38 year old IT professional and major libertarian. He decided to move to New Zealand and establish permanent residency. Takes two years and if you have a BS in technology, they practically beg you to move there. He actually splits time between Arizona and NZ and because he works for a major IT company, he is able to work wherever he wants. NZ has a lot of things going for it and he went there because of the relative economic and social freedom they enjoy.
I am in the same boat. I work in Utah and Arizona, but my boss is in Austin. Most of our customers are in California and New York. I get to live in a Red State making big city Blue State money. I could just as easily live in New Zealand or Ireland or just about anywhere I want. So why would I move to France or Canada as compared to Ireland or New Zealand? Plus they speak French and when I took French 101 I only learned a couple phrases:
Posted by: Justin B at April 5, 2007 05:59 PM
BTW, letting the Tax Cuts expire is a tax increase and this makes us even less competitive. Places like Sweden that all the Libs tout as being an ideal model of Socialism and Tax Fairness is moving towards more freedom and lower taxes while we go the opposite way...
Bad move. If we want 3+% GDP Growth, we need to be more like Ireland than like Sweden or France or Germany.
Posted by: Justin B at April 5, 2007 06:03 PM
Bad move. If we want 3+% GDP Growth, we need to be more like Ireland than like Sweden or France or Germany.
Oh yeah. Let's be like Ireland.
Let's have a country with nearly 23% of the populace lacking fundamental literacy skills. And the fact is Ireland still has one of the highest poverty rates among developed nations.
But where Justin really shows a need for a basic economics survey course is his use of GDP to support his Irish economic miracle argument. In most countries, the difference between GDP and GNP is meaningless. But in Ireland the difference between GDP and GNP is about 25% because about 25% of revenues are sucked out of Ireland. This renders per capita incomes based on GDP meaningless.
Posted by: Jadegold at April 5, 2007 06:56 PM
Thanks for the bunking, there.
Posted by: Will Franklin at April 5, 2007 07:51 PM
Senators Levin and Dorgan are smart. If we don't pass such legislation wealthy Americans will have the ability to shelter income offshore in tax havens with no income tax paid in the US. I say that is unpatriotic when our troops need funding. Further, this puts the burden of paying tax on honest Americans.
Posted by: AFS at April 6, 2007 07:48 AM
Population: 4.1 million GDP (PPP): $158.0 billion 4.5% growth in 2004 6.1% 5-yr. comp. ann. growth $38,827 per capita Unemployment: 4.5% Inflation (CPI): 2.2%
Population below poverty line: 10% (1997 est.) Literacy: definition: age 15 and over can read and write total population: 99% male: 99% female: 99% (2003 est.)
Fundamental economics course, eh? Please send a hyperlink so that I can see your references for the numbers that you posted. I sent you links to Heritage and the CIA factbook. I am thinking you used http://www.my-ass.com/pulledoutof/. Don't try to make me look dumb by spouting off fake figures. I know how to fact check. I learned that in College where I graduated with my BS in Global Business Summa Cum Laude, top of my class. 4.0 GPA. That sort of thing. I'll post transcripts if you want to fact check.
Basic Economics Survey Course... good one.
Posted by: Justin B at April 6, 2007 12:21 PM
Gentlemen, I presume - I lived in Ireland for 2 years. Let me explore a few items for you based on personal experience. The corporate tax rate is very low but not the individual tax rate. See http://www.worldwide-tax.com/ireland/ireland_tax.asp Second, they were a very poor country until very recently where they have seen explosive growth. Ireland has benefitted because of a low corporate tax rates, no transfer pricing, an English speaking population and a strong connection to the US. But let us not forget the most important - they are not spending billions on military spending. If the USA wants a strong economy, the first thing it needs to do is to cut military spending. Second we need to do something about the Medicare problem. If we don't then in a generation all our money will be paid to medicare and servicing our national debt.
The only thing that Ireland needs to be careful is that the cost of living there has risen very quickly making it one of the most expensive places to live in Europe. They could easily price themselves out of the market and the US companies will simply move somewhere else - such as Hungary.
Posted by: AFS at April 6, 2007 04:50 PM
But let us not forget the most important - they are not spending billions on military spending. If the USA wants a strong economy, the first thing it needs to do is to cut military spending.
Major issue is that medicare, social security, and entitlements are going to destroy this country. These programs dwarf the military spending and represent the real threat. Military spending is something the Federal Govt is Constitutionally required to do. Entitlements aren't.
Posted by: Justin B at April 6, 2007 08:28 PM
Ireland has benefitted because of a low corporate tax rates, no transfer pricing, an English speaking population and a strong connection to the US.
English speaking population... Note how that is also a key reason why India is growing so fast. If you want to grow your economy teach your population English and cut your tax rates. I know it sounds culturally insensitive, but the world operates in English. It is the lowest common denominator for multinational businesses to conduct their discussions in. It is the countries like the Middle East that chant "Death To America" and decline to learn the language of business and/or implement strict social and economic controls that have low growth rates.
Posted by: Justin B at April 6, 2007 08:31 PM
Two responses - One - I half agree with the English comment. I have travelled all over Asia and it is English that they want to speak. However, with the rise of the Chinese I could see that in 150 years, it might be Mandarin that is the dominant lanugage. Second, India needs to be careful not to also price themselves out of the market. I have a client that has operations in India and the prices India is charging is equivalent to US/W Europe. In fact, many Indian companies are outsourcing to E Europe.
Posted by: AFS at April 7, 2007 10:58 AM
AFS - linguistics note, as here you come into a favorite subtopic of mine. Though there are 6,000 living languages, nearly everyone in the world speaks one of the top 20. The others will rapidly vanish. About half of the top 20 are languages that are not necessarily popular internationally, but have a large number of primary speakers in a populous area such as China or India. Thus, the only nominations for what languages will be used are a very short list. English would certainly have the edge at the moment and for the next few decades, but language adoption has been subject to some odd twists over the centuries, and it is best not to project out much beyond that. If you have interest in the topic, John McWhorter is a good writer and speaker on same.
Posted by: Assistant Village Idiot at April 7, 2007 11:42 AM
It would seem that the dominant languages would all be of European origin and primarily those that were spread by colonialists in the 16th-20th Century. It happens that the English were the among the most successful colonies and the most widespread, I would think closely followed by the Spanish and French in terms of the extent of their colonial system. In the entire Western Hemisphere (not counting small island nations, four languages are spoken--English, Spanish, French, and Portugese. There are far more Spanish speakers than any other.
Given that the US represents the single largest economy in the world, doubling the size of the number two economy, China, most countries and companies recognize that to transact business with the largest economy, they must speak English.
Funny that we speak English because of the colonial influence of the Brits, but the world is changing over the English because of those 13 little colonies.
Posted by: Justin B at April 7, 2007 04:55 PM
Seems I have hijacked the thread. Cool.
Arabic and Mandarin are also on the big list, and they are also international. The Chinese also colonised, and speakers of both have used military and economic force to rule other nations. Chinese ex-pats throughout the world tend toward use of Mandarin as the default, though Chinese reads the same regardless of one's dialect, which is one of its advantages.
The 13 colonies, yes, but the existence of the British Commonwealth countries across the globe created footholds which made the American linguistic dominance easier. And the English-speakers in India have a fairly British cast.
Posted by: Assistant Village Idiot at April 8, 2007 02:14 PM
I must say that the last blog made me never ever want to own a captial one credit card. In fact, I just cancelled mine.
Posted by: AFS at April 11, 2007 04:47 PM