Feeds:
Posts
Comments

Posts Tagged ‘international bureaucracy’

Here’s a new mini-documentary from the Center for Freedom and Prosperity, narrated by Natasha Montague of Americans for Tax Reform, that explains why the process of tax competition is a critical constraint on the propensity of governments to over-tax and over-spend.

The issue is very simple. When labor and capital have the ability to escape bad policy by moving across borders, politicians are more likely to realize that it is foolish to impose high tax rates. And they oftentimes compete for jobs and investment by lowering tax rates. This virtuous form of rivalry helps explain why so many nations in recent years have lowered tax rates and adopted simple and fair flat tax systems.

Another great feature of the video is the series of quotes from winners of the Nobel Prize. These economists all recognize competition between governments is just as desirable as competition between banks, pet stores, and supermarkets.

The video also discusses how politicians are attacking tax competition. It mentions a privacy-eroding scheme concocted by governors to tax out-of-state purchases (how dare consumers buy online and avoid state sales tax!).

And it also discusses a very destructive tax harmonization effort by a Paris-based bureaucracy (the Organization for Economic Cooperation and Development, subsidized with American tax dollars!), which would undermine fiscal sovereignty by punishing jurisdictions that adopt pro-growth tax systems that attract labor and capital.

The issues discussed in this video generally don’t get a lot of attention, but they are critical for the long-run battle to restrain government. Please share widely.

P.S. This speech by Florida’s new Governor is a good example of how tax competition encourages governments to do the right thing.

Advertisements

Read Full Post »

I’ve already poked fun at Herman Van Rompuy, the nondescript über-bureaucrat who has risen to the non-elected post of European Council President. I’ve mocked Rompuy’s attempts to compete with other European politicians, and I encourage everyone to have a good laugh at this video of Van Rompuy getting eviscerated by a British MEP.

We now have a new reason to roll our eyes about Van Rompuy. He is whining about those mean, nasty bond traders who have decided that it is a somewhat risky proposition to lend money to Europe’s welfare states. Even though Van Rompuy has no experience with money (other than spending the fruits of other people’s labor), he imperiously thinks it is “absurd” to put Greece and Portugal in the same category as Ukraine and Argentina.

I guess he would prefer if everyone just pretended these countries were in good shape and able to pay their bills, sort of like a fiscal version of “The Emperor’s New Clothes.”

Here’s the relevant passage from an article in the EU Observer.

European Council President Herman Van Rompuy has lashed out at ‘bond vigilantes’ over the treatment of peripheral eurozone economies in recent months. Speaking in London after a meeting with Prime Minister David Cameron on Thursday (13 January), Mr Van Rompuy described recent events as “absurd” and said the likes of Greece and Portugal should not be treated the same as poor countries: “Recent market developments are sometimes rather strange. The spreads now show default risks for some eurozone countries bigger than for emerging countries like Ukraine or Argentina: that is absurd.”

Read Full Post »

Why hasn’t Europe fought World War III? Could it be because the Soviet Union eventually collapsed? Could it be that the NATO, the western military alliance, was effective? Could it be the mutually assured destruction kept the peace? Could it be that America’s commitment to defend Europe was a deterrent?

But all those reasons focus on the role of the Soviet Union. Let’s cast the net wider and ask why World War III, or even smaller wars, didn’t begin with fights among Western European nations. How did long-time rivals France and England avoid war? Why did the Germans not launch another war on the continent? Did these things not happen because civilization finally triumphed? Because the peoples of Europe finally got sick of fighting? Because Western European nations were focused on the danger from the Soviet Union? Because the large U.S. military presence as part of NATO helped keep the peace?

I’m not a foreign policy expert, so I’m sure this is not even close to being a comprehensive list of potential explanations. But it turns out that all of my guesses are wrong. Or they’re wrong if we choose to believe French Finance Minister Christine Lagarde, who says the creation of a pan-European bureaucracy in Brussels has been the key to peace. Moreover, we are supposed to believe that the only way to keep the peace is to impose more harmonization, more centralization, and more bureaucratization on the unwilling peoples of Europe.

You may think I’m being satirical, but this is not a joke. Ms. Lagarde was being interviewed on BBC. She was asked about plans to further erode national sovereignty and transfer more power to Brussels, and whether the people of Europe (rather than just the political elite) should get to choose whether this happens. Here’s a summary of her  mind-blowing statement from Open Europe.

…when asked whether people had ever voted for this convergence she replied, “The European project has been around for over fifty years and it was built on the back of a situation where people were at war…The European project is something we all believe in because we want peace to be maintained.”

To be fair, I don’t actually think Ms. Lagarde is stupid. There’s no way she thinks the so-called European Project, or any of its bureaucratic creations (European Commission, European Parliament, European Court of Justice, etc), deserves credit for keeping the peace. But she obviously thinks the people of Europe are a bunch of stupid peasants and serfs. Or she thinks they are so powerless, thanks to the anti-democratic structure of the European Union and the housebroken European media, that she can say something utterly absurd and be confident that there will be no adverse consequences.

Read Full Post »

The International Monetary Fund is a great place to work – at least for those who don’t feel guilty about getting extravagant salaries from taxpayers. And what do IMF bureaucrats do for the money we pay them (American taxpayers finance the biggest share of the bureaucracy’s expenses)?

Many of them jet around the world in business class, stay at first-class hotels, and tell nations to raise taxes and devalue their currencies. And to add insult to injury, they specialize in misallocating global saving and investment by bailing out irresponsible nations.

This is not to say the bureaucrats are always wrong. While the IMF often is bad on taxes and monetary policy, the bureaucrats sometimes give good advice on trade, regulation, and government spending.

But even when they give good advice, that doesn’t justify their big salaries (which are tax-free, by the way). The real question, though, is whether the IMF should even exist – especially when the bureaucracy more often than not is on the wrong side of key public policy issues.

Unfortunately, instead of being cut back or phased out, the IMF is getting even bigger. While the rest of us are having to tighten our belts, the bureaucrats at the IMF are having fun spending our money. The gold-plated international bureaucracy now wants to spend big bucks to upgrade it already lavish headquarters in Washington. Here’s a blurb from the UK-based Guardian.

…the International Monetary Fund’s bureaucrats plan to concentrate on a matter closer to home in the new year – sprucing up their offices in downtown Washington DC. Dominique Strauss-Kahn, the fund’s managing director, quietly announced last week that he would be asking permission from the organisation’s cash-strapped member states to refurbish its main headquarters building. …Pressure groups greeted the news with scepticism, pointing out that eight years ago the fund spent $150m on a second building, complete with external waterfall, after saying its original site – known as HQ1 – was no longer big enough for its staff of highly-paid international officials.They said the fund was now flush with cash after selling some of its stock of gold and extracting fees and interest payments from troubled countries such as Ireland and Greece. …Peter Chowla, programme manager at the Bretton Woods Project, a think tank that monitors the activities of the IMF and the World Bank, said: “After a nice financial crisis, the IMF’s balance sheet is looking very health – lots of interest to pour in from Greece and Ireland and commitment fees on money never even lent to Colombia, Mexico and Poland. So the fund is thinking about spending some of the proceeds on remodelling its headquarters.”

Read Full Post »

Some ideas are so horrible that I’m almost at a loss for words. The United Nations is a grotesquely wasteful and corrupt international bureaucracy with a long track record of failure and incompetence.

Yet some people think this collection of looters, moochers, and kleptocrats should have authority over the Internet. I’m not kidding. Here are some of the details from an Australian newspaper.

The United Nations is considering whether to set up an inter-governmental working group to harmonise global efforts by policy makers to regulate the internet. Establishment of such a group has the backing of several countries, spearheaded by Brazil. At a meeting in New York on Wednesday, representatives from Brazil called for an international body made up of Government representatives that would to attempt to create global standards for policing the internet… India, South Africa, China and Saudi Arabia appeared to favour a new possible over-arching inter-government body. However, Australia, US, UK, Belgium and Canada and attending business and community representatives argued there were risks in forming yet another working group that might isolate itself from the industry, community users and the general public.

For what it’s worth, this proposal is so crazy that it appears that even the Obama Administration is opposed. I certainly hope so, because this proposal inevitably would lead to many bad results, including restrictions on freedom of speech.

Read Full Post »

The old saying that “two wrongs don’t make a right” is especially true in the field of public policy. A good example is the crazy new proposal from the United Nations to collect billions of dollars by imposing global taxes on financial transactions and energy. That’s bad enough, but the international bureaucracy wants to impose these taxes in order to bribe developing nations into agreeing to cripple their economies with policies designed to fight global warming. So people in the real world would pay more money to support a misguided scheme, while a bunch of tax-free bureaucrats get more power. This is so absurd that even the Obama Administration is opposed – at least according to this Bloomberg story.

At least $65 billion might be raised by taxing foreign-exchange transactions and auctioning pollution permits, a United Nations panel said today in a report recommending ways to finance aid for fighting global warming.

The panel, which includes billionaire investor George Soros and Larry Summers, director of President Barack Obama’s National Economic Council, said selling carbon-emissions permits would generate $38 billion and a financial transactions tax an additional $27 billion, according to the report released today.

The findings are intended to guide envoys at UN climate talks that start this month in Mexico as they seek ways to pay for $100 billion in climate aid that was pledged by 2020 to poor nations at last year’s summit in Copenhagen. The report found that the goal is “challenging but feasible” to achieve.

…Former U.K. Prime Minister Gordon Brown, French President Nicolas Sarkozy and labor groups including the U.K. Trades Union Congress have supported the idea. President Barack Obama’s administration opposes it. A tax of 0.05 percent on financial transactions may raise as much as $700 billion a year, according to WWF, a Washington-based global environmental activist group.

Read Full Post »

The bureaucrats at the International Labor Organization (which shouldn’t even exist) are correct to note that high levels of unemployment threaten social unrest. But like most left-wing international bureaucracies, they think the solution is more government – including so-called stimulus and government intervention in labor markets.

The extended loss of employment and growing perceptions of unfairness risked increasing social tension, the ILO said. In 35 countries for which data exists, nearly 40 per cent of jobseekers have been without work for more than one year, running risks of demoralisation and mental health problems, and young people were disproportionately hit by unemployment. It noted that social unrest related to the crisis has been reported in at least 25 countries, including some recovering emerging economies. …Torres warned governments against withdrawing fiscal stimulus measures while recovery was still weak. The ILO recommended…A combination of active labour market policies including work-sharing that target vulnerable groups such as young people, and training [and] A closer link between wages and productivity gains in surplus countries to boost demand and job creation;

Read Full Post »

Older Posts »

%d bloggers like this: