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Posts Tagged ‘Video’

Since it is tax-filing season and we all want to honor our wonderful tax system, let’s go into the archives and show this video from last year about the onerous compliance costs of the internal revenue code.

Narrated by Hiwa Alaghebandian of the American Enterprise Institute, the mini-documentary explains how needless complexity creates an added burden – sort of like a hidden tax that we pay for the supposed privilege of paying taxes.

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I’m not a big fan of the IRS, but usually I blame politicians for America’s corrupt, unfair, and punitive tax system. Sometimes, though, the tax bureaucrats run amok and earn their reputation as America’s most despised bureaucracy.

Here’s an example. Earlier this year, the Internal Revenue Service proposed a regulation that would force American banks to become deputy tax collectors for foreign governments. Specifically, they would be required to report any interest they pay to accounts held by nonresident aliens (a term used for foreigners who live abroad).

The IRS issued this proposal, even though Congress repeatedly has voted not to tax this income because of an understandable desire to attract job-creating capital to the U.S. economy. In other words, the IRS is acting like a rogue bureaucracy, seeking to overturn laws enacted through the democratic process.

But that’s just the tip of the iceberg. The IRS’s interest-reporting regulation also threatens the stability of the American banking system, makes America less attractive for foreign investors, and weakens the human rights of people who live under corrupt and tyrannical governments.

This Center for Freedom and Prosperity video outlines five specific reason why the IRS regulation is bad news and should be withdrawn.

I’m not sure what upsets me most. As a believer in honest and lawful government, it is outrageous that the IRS is abusing the regulatory process to pursue an ideological agenda that is contrary to 90 years of congressional law. But I guess we shouldn’t be surprised to see this kind of policy from the IRS with Obama in the White House. After all, this Administration already is using the EPA in a dubious scheme to impose costly global warming rules even though Congress decided not to approve Obama’s misguided legislation.

As an economist, however, I worry about the impact on the U.S. banking sector and the risks for the overall economy. Foreigners invest lots of money in the American economy, more than $10 trillion according to Commerce Department data. This money boosts our financial markets and creates untold numbers of jobs. We don’t know how much of the capital will leave if the regulation is implemented, but even the loss of a couple of hundred billion dollars would be bad news considering the weak recovery and shaky financial sector.

As a decent human being, I’m also angry that Obama’s IRS is undermining the human rights of foreigners who use the American financial system as a safe haven. Countless people protect their assets in America because of corruption, expropriation, instability, persecution, discrimination, and crime in their home countries. The only silver lining is that these people will simply move their money to safer jurisdictions, such as Panama, the Cayman Islands, Hong Kong, or Switzerland, if the regulation is implemented. That’s great news for them, but bad news for the U.S. economy.

In pushing this regulation, the IRS even disregarded rule-making procedures adopted during the Clinton Administration. But all this is explained in the video, so let’s close this post with a link to a somewhat naughty – but very appropriate – joke about the IRS.

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To put it mildly, the Federal Reserve has a dismal track record. It bears significant responsibility for almost every major economic upheaval of the past 100 years, including the Great Depression, the 1970s stagflation, and the recent financial crisis. Perhaps the most damning statistic is that the dollar has lost 95 percent of its value since the central bank was created.

Notwithstanding its poor performance, the Federal Reserve seems to get more power over time. But rather than rewarding the central bank for debasing the currency and causing instability, perhaps it’s time to contemplate alternatives. This new video from the Center for Freedom and Prosperity dives into that issue, exposing the Fed’s poor track record, explaining how central banking evolved, and mentioning possible alternatives.

This video is the first installment of a multi-part series on monetary policy. Subsequent videos will examine possible alternatives to monopoly central banks, including a gold standard, free banking, and monetary rules to limit the Fed’s discretion.

One of the challenges in this field is that opponents of the Fed often are portrayed as cranks. Defenders of the status quo may not have a good defense of the Fed, but they are rather effect in marginalizing critics. Congressman Ron Paul and others are either summarily dismissed or completely ignored.

The implicit assumption in monetary circles is that there is no alternative to central banking and fiat money. Anybody who criticizes the current system therefore is a know-nothing who wants to create some sort of libertarian dystopia featuring banking panics and economic chaos.

To be fair, it certainly might be possible to create a monetary regime that is worse than the Fed. That is why the next videos in this series will offer a careful look at the costs and benefits of possible alternatives.

As they say, stay tuned.

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A former  Cato colleague, Will Wilkinson, made one of the most astute and powerful observations I have ever read when he wrote that, “…the more power the government has to pick winners and losers, the more power rich people will have relative to poor people.”I thought about this statement when I read a column today by muckraking journalist Tim Carney, who discusses how former Republican Senator Bill Frist is advising his fellow GOPers to surrender and give up the fight against Obamacare. But, as Tim warns, Frist is not an impartial observer. He is getting rich (or richer, to be more accurate) by helping special interests line their pockets by taking advantage of the government’s added power over the health care sector.

If you’re a Republican, and you don’t want the media to pry into your financial conflicts of interest, there used to be a simple method: support Democratic big-government policies. The latest Republican to try this rule is Bill Frist. …as I wrote in my column last year:

Frist is a partner in a private investment firm that bets on health care companies — and on regulation…. So Frist gets rich by helping pick the health care companies that will get rich. Now he’s backing Obamacare — and winning praise for it.

Look at some of the language on Cressey & Co’s webpage. “The Cressey & Company strategy applies unique insights and experience to produce extraordinary results” [emphasis added]. What “unique insights” do you think Frist provides? Another page on the site gives us a hint: “With deep expertise in the healthcare reimbursement and regulatory environments, the Cressey & Company team has invested in almost every for-profit niche of healthcare.” Stein noted Frist’s conflicts of interest, but don’t expect the rest of the media to be as thorough — after all, last year, Frist got a free pass as did health-care lobbyist Bob Dole. Sharing the stage with Frist was Tom Daschle, a K Street consultant for many health-care companies. The venue: The Bipartisan Policy Center. That’s a clue — if you hear the word “bipartisan,” there’s a good chance everyone on the marquee is getting paid.

Tim’s work on these issues is first rate, and you should follow what he writes – but only if you have a strong stomach and low blood pressure. Why? Because if you follow his work, you will understand that the worst forms of redistribution in Washington are the ones that 1) take place behind closed doors, and 2) transfer money from ordinary people to the rich and powerful.

This is the essential point of my video linking big government to corruption, though I wasn’t as succinctly eloquent of Will Wilkinson or as exhaustively detailed as Tim Carney.

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This doesn’t have the production quality of the Hayek-Keynes rap video, and it presumably won’t get as many views, but this young lady has a very clever love song for Friedrich Hayek.

(h/t Instapundit)

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The White House recently released a video, narrated by Austan Goolsbee of the Council of Economic Advisers, asserting that higher tax rates on the so-called rich would be a good idea.

Since Goolsbee’s video made so many unsubstantiated assertions and was guilty of so many sins of omission, here’s a rebuttal video, narrated by yours truly.

This new Center for Freedom and Prosperity video includes the full footage of the White House production, so viewers can decide for themselves which side is correct.

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