Billions of dollars are moving out of Canada – nearly all tax free – with 92 tax treaties signed.
“I think those of us who warned, 35 years ago, that one of the consequences of this would be, ‘those who have the most would end up paying the least and those with the least would end up paying the most’ — we’ve been proven right. ”
The Massachusetts Supreme Court will decide whether a local shrine should be tax-exempt—a decision that could have broad implications for faith organizations in America.
The world wants U.S. debt and the U.S. needs infrastructure repair. Seems like a natural match unless you’re a Republican or fellow-traveling Democrat.
Must-Read: Narayana Kocherlakota: The World Needs More U.S. Government Debt: “Are government-imposed restrictions holding back the U.S. economy?… …In a way, yes: The federal government is causing great harm by […]
The 50 biggest US companies, including global brands such Pfizer, Goldman Sachs, Dow Chemical, Chevron, Walmart, IBM, and Procter & Gamble, have stashed more than a trillion dollars offshore and used more than 1,600 subsidiaries in tax havens to avoid billions of dollars in tax each year, according to Oxfam America. In a new report released today ahead of Tax Day, Oxfam outlines how corporate tax dodging costs the US an estimated $100 billion each year, a gap that the average American taxpayer would have to shell out an extra $760 to cover…..
…..The report reveals that the same companies are among the largest beneficiaries of US taxpayer funded support, receiving a staggering $11 trillion in federal loans, loan guarantees and bailout assistance from 2008-2014 even as they avoided hundreds of billions of dollars in taxes over the same period.
Oxfam calculated that during this period, these 50 companies collectively received approximately $27 in loan support for every $1 they paid in federal taxes.“…..
The companies, which made nearly $4 trillion in profits globally between 2008 and 2014, paid an average effective tax rate of just 26.5% – well below the statutory tax rate of 35% in the US and well below the tax rate of an average US worker of 31.5%…..
“For every $1 spent on lobbying, the largest 50 companies received $130 in tax breaks and more than $4,000 in federal loans, loan guarantees and bailouts,”…..
Since the initial JP Morgan deal that sparked outrage over tax deductions, consumer relief wiggle room, and other fine-print details that make such deals cheaper for companies than press releases indicate, Sen. Elizabeth Warren (D-MA) and other lawmakers have tried to force federal and state lawyers to stop the doublespeak. Warren and Sen. Tom Coburn (R-OK) have pushed for the Truth in Settlements Act since early 2014.The measure would require federal agencies to clearly delineate between deductible and non-deductible settlement costs, and include an estimate of the actual corporate costs of such deals in their formal communications about them. It passed the Senate in September, but hasn’t moved out of any of three separate committees with jurisdiction over it in Speaker Paul Ryan’s (R-WI) House.
America’s great public research universities, which produce path-breaking discoveries and train some of the country’s most talented young students, are under siege. The result may be a significant weakening of the nation’s preeminence in higher education. Dramatic cuts in public spending for state flagship universities seem to be at odds with widespread public sentiment. Americans say they strongly believe in exceptional educational systems; they want their kids to attend excellent and selective colleges and to get good, well-paying, prestigious jobs. They also support university research. After 15 years of surveys, Research! America found in 2015 that 70 percent of American adults supported government-sponsored basic scientific research like that produced by public universities, while a significant plurality (44 percent) supported paying higher taxes for medical research designed to cure diseases like cancer or Alzheimer’s. Nonetheless, many state legislators seem to be ignoring public opinion as they essentially starve some of the best universities—those that educate about two-thirds of American college students.
According to the American Academy of Arts and Sciences’ recently completed Lincoln Project report, between 2008 and 2013 states reduced financial support to top public research universities by close to 30 percent. At the same time, these states increased support of prisons by more than 130 percent. New York City’s budget office reported in 2013 that incarcerating a person in a state prison cost the city roughly $168,000 a year. California apparently does it on the cheap: It costs roughly $64,000 annually for each prisoner—a bit more than the cost of a year at an Ivy League university (average tuition is $50,000) and far more than at the University of California, Berkeley, ($13,000) or at CUNY ($8,000).
All this amounts, arguably, to a pillaging of the country’s greatest state universities. And that pillaging is not a matter of necessity, as many elected officials would insist—it’s a matter of choice. If Wisconsin’s governor and legislature succeed in eliminating or emasculating tenure for faculty members at the University of Wisconsin, Madison, they can say goodbye to the greatness of that institution of higher learning. If Florida’s governor asks students in the humanities or arts to pay higher tuition than those who major in business or STEM subjects, Florida’s universities are apt to deteriorate in quality. And just so it doesn’t seem like I’m cherry picking, consider what North Carolina’s governor said not long ago: “If you want to take gender studies, that’s fine, go to a private school and take it. But I don’t want to subsidize that if that’s not going to get someone a job.” The consequence of such policy choices, it seems, is that tuition will go up and access for kids from poorer families will go down.
Looking at the documents leaked from Mossack Fonseca and one thing is clear: Britain’s network is once again at the core. More than half of the companies listed in the documents are registered in the UK or its Overseas Territories, and Hong Kong plays a huge role.
Of course, this shouldn’t be surprising. Britain has for for a while now been thought to be the global capital for money laundering. And it’s no shock that nothing has been done about it. In 2010, two years after they crashed the global economy, the City paid for more than half of the Conservative party’s election campaign, helping (along with the aforementioned Lord Ashcroft) them limp them over the line, with a Lib Dem shaped crotch. Though, of course, Labour did little to regulate in the previous 13 years.
If we want to understand modern Britain, first we need to realise that our primary economic function in the world is probably our network of tax havens. After all, around $21tn is estimated to sit in offshore accounts, of which Britain’s territories are said to make up by far the biggest part. Our own GDP is only around $3tn.
Second, we need to get to grips with the serious claims about our role as the global money laundering capital: a function which pushes up the price of the pound, making other exports unaffordable (bye bye steel), and drives up the cost of houses in London and the South East, fuelling a vast speculative bubble which sucks investment out of the rest of the economy.
And third, we need to think about how this gradually dawning economic reality interacts with our politics: not through the obvious corruption of direct bribery, but through revolving doors between government and civil service, through old boy’s networks and friendship groups, through perfectly legal election donations and media domination.
The U.S. “is effectively the biggest tax haven in the world” —Andrew Penney, Rothschild & Co.
An investigation published today by the International Consortium of Investigative Journalists and its media partners reveals the hidden workings of a secretive industry that banks and lawyers use to hide the financial holdings and dealings of powerful clients, including prime ministers, parliamentarians, plutocrats and criminals, according to a trove of leaked documents.
The files, known as the Panama Papers, exposes the offshore holdings of 12 current and former world leaders and reveals how associates of Russian President Vladimir Putin secretly shuffled as much as $2 billion through banks and shadow companies, according to the joint investigative project conducted by ICIJ, the German newspaper Süddeutsche Zeitung and more than 100 other news organizations around the globe. ICIJ is the international arm of the Center for Public Integrity.
The files — which total more than 11.5 million documents — contain new details about major scandals ranging from England’s most infamous gold heist in 1983, an unfolding political money laundering affair in Brazil and bribery allegations currently convulsing FIFA, the body that rules international soccer and is under investigation by the U.S. Justice Department.
The next time you read about macro-economists’ authoritative statements on forecasting the economy under Bernie’s programs, remember the following two charts and how well the macro-economists at the IMF did on projecting World Growth and China’s Growth. Doesn’t make him right, makes you think.
Political and social change emanate from persistent pressure for a just world, not settling for what is “realistic” before even getting to the negotiating table.
There is a growing sense of tighter financial conditions, particularly to the commercial real estate sector. Late last year the regulators issued a joint statement on Prudent Risk Management for Commercial Real Estate Lending and the latest Senior Loan Officer Opinion Survey (SLOOS) shows that banks tightened their lending standards to commercial real estate meaningfully in 4Q15…. The growing sense of gathering clouds in terms of tightening financial conditions to commercial real estate translates into a more challenging road ahead for US commercial real estate.
Sanders points out: “Three out of the 4 largest financial institutions (JP Morgan Chase, Bank of America and Wells Fargo) are nearly 80 percent bigger than before we bailed them out. Incredibly, the six largest banks in this country issue more than two-thirds of all credit cards and more than 35 percent of all mortgages. They control more than 95 percent of all financial derivatives and hold more than 40 percent of all bank deposits. Their assets are equivalent to nearly 60 percent of our GDP. Enough is enough.”
The Federal Reserve is becoming the focal point of a longstanding divide between more business-friendly Democrats and the party’s populist branch over how the next president should promote full employment and police Wall Street.
Democratic presidential hopeful Sen. Bernie Sanders (I-Vt.) put forward a lengthy list of proposals for reforming the Federal Reserve in a Dec. 23 op-ed in the New York Times.
Lawrence Summers, a former top economic adviser to President Barack Obama, who nearly became Fed chairman in 2013, penned a response on Tuesday agreeing with Sanders on some grounds, but forcefully pushing back against the notion that Wall Street influence at the Fed is too pervasive.
In the America of haves and have-nots, fewer folks are “movin’ on up” like George Jefferson of the classic sitcom. In a new paper for the Institute for New Economic Thinking, Peter Temin, MIT economist and economic historian, breaks down how it happened and where we’re headed with a powerful model first used by West Indian economist W. Arthur Lewis, the only person of African descent to win a Nobel Prize in economics. Dual economies are common in less developed countries, but Temin argues that America has now diverged into a top thirty percent, where children receive excellent educations and grow up to work in sectors like finance, technology and electronics industries (FTE)— and then there’s the rest, the low-wage folks who live paycheck to paycheck and whose kids have little hope of joining the lucky ones at the top. Temin explains what drives the dual economy, what race has to do with it, how children are hurt, and why our political system can’t seem to fix anything.
Source: How Economics and Race Drive America’s Great Divide | Institute for New Economic Thinking
Timely article given recent article in NY Times (An S.E.C. Settlement With Citigroup That Fails to Name Names) wherein Citi agrees to pay a $180 million settlement plus $726 million in investor compensation and yet the SEC not only doesn’t hold any individual responsible – it doesn’t even name them. Talk about moral hazard.
The sentencing of the trader Tom Hayes for his part in the Libor scandal caused many a sharp intake of breath on London’s Canary Wharf.…
Housing tax breaks for the rich are worth more than housing subsidies for the poor.
Finally someone gets it. Borrow when rates and debt are low to invest in future growth – duh! Just ask any CEO or anyone for that matter – except politicians and knee-jerk anti-government types (unless they’re the beneficiaries of course.
Liberal Leader Justin Trudeau says a Liberal government won’t balance the books for another three years, but will double spending on infrastructure to jump-start economic growth.
In Toronto, researchers recently found that people living on tree-lined streets reported health benefits equivalent to being seven years younger or receiving a $10,000 salary rise. As well as studies revealing benefits from everything from improved mental health to reduced asthma, US scientists have even identified a correlation between an increase in tree-canopy cover and fewer low-weight births. And economic studies show what any estate agent swears by: leafy streets sell houses. Street trees in Portland, Oregon, yielded an increase in house prices of $1.35bn, potentially increasing annual property tax revenues by $15.3m.
The EU Open Data Portal provides, via a metadata catalogue, a single point of access to data of the EU institutions, agencies and bodies for anyone to reuse.