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from the luxembourg-shuffle-fulfilled-by-amazon dept.
In 2012, something like US$80 billion worth of multinationals' profits worked on their suntans in Bermuda, according to an international report into profit-shuffling and tax avoidance.
Oxfam, the Tax Justice Network, the Global Alliance for Tax Justice, and Public Services International have put their heads and wallets together to fund a report into how multinationals are picking the pockets of G20 nations.
In one way, it's no surprise: the world's top economies are, pretty much by definition, the places where multinationals will make the most money. However, they also have the best resources to try and get companies to pay their taxes, and if the Oxfam et al report is accurate, they're getting gamed hand-over-fist.
The report says just twelve countries (the USA, Germany, Canada, China, Brazil, France, Mexico, India, the UK, Spain and Australia) account for 90 per cent of US multinationals' “missing” profits.
Those profits get processed through various implementations of the “Irish-Dutch sandwich” to be booked in low-tax countries like the Netherlands, Ireland, Luxembourg, Switzerland and Bermuda.
If the numbers are accurate (the report's authors put a number of caveats on the data), then between $500 and $700 billion gets shuffled around in this way, which is how Bermuda found itself home to $80 billion worth of profits in 2012 (its GDP in the same year was a paltry $5.47 billion).
(Score: 3, Interesting) by Phoenix666 on Thursday November 12 2015, @03:48PM
That's from an article in Forbes in 2012. Presumably that figure has only grown dramatically since then.
Me, I think the best solution to the problem is akin to what Germany did during reunification wherein they let people in the East exchange their money at a fixed rate up to a certain limit. So we figure out what the average cash holding of the middle class family is, set the ceiling at 150% of that, and let them exchange their old dollars for new dollars. Hey presto $21 trillion in ill-gotten gains suddenly becomes toilet paper. (so to speak--of course no one holds physical cash anymore)
Washington DC delenda est.
(Score: 0) by Anonymous Coward on Thursday November 12 2015, @03:56PM
That constitutes a currency default.
That is a very, very, very bad idea (unless you're trying to smash the US standard of living and quite likely precipitate another civil war, in which case, rock on, brother!)
But at least you're thinking about it.
(Score: 2) by Phoenix666 on Thursday November 12 2015, @04:56PM
No, it doesn't. I put a simple gloss on a complex subject, because it's not worth anyone's time on an internet forum to compose an apt proposal that covers all the bases, and which no one will read. But there has been precedent, it has been done at least twice with major, major currencies in living memory, and we can do it too.
Washington DC delenda est.
(Score: 0) by Anonymous Coward on Thursday November 12 2015, @05:26PM
Just saying it doesn't constitute a currency default doesn't suddenly make it not one.
Let's break this down.
In Germany, to take the case you referred to, it was a currency default. It didn't matter much because one state was actually going away, the prior currency was basically toilet paper anyway, and the successor state was picking up the burdens. All the creditors, then and future, could have confidence in what was happening with debts that remained or might be established in future. So it was a default, but a tolerable default.
What you're proposing is a unilateral refusal to honour pre-existing obligations (a default!) in the form of a taking (legally enforced!) of accumulated financial assets, as measured in terms of the currency.
That is a textbook currency default, without so much as the fig leaf of unifying disparate currencies (such as with the DDR, or the establishment of the Euro). The moment that even gets mooted in the halls of power, the currency will crash, hard, while people flee to other currencies, hard commodities, works of art, foreign securities - anything they can.
It is one of the most ruinous plans I've read on soylentnews, and that's saying something.
(Score: 2) by Phoenix666 on Thursday November 12 2015, @07:24PM
And your desire to cast it as a currency default does not make it one. Touche.
What it does represent is a real desire to translate paper balances with real ones.
There would have to be provisions to classify debt held by state actors differently from that held by private banks or individuals. That's part of the simple gloss I was referring to. But it's targeted to affect those who have squirrelled away ill-gotten gains in offshore banks, not those who have invested in good faith. It is targeted at those who have gamed the system, who represent a fraction of the world.
Yes, it is ruinous, for the 1%. But, then, they have quite ruined the mass of humanity for far too long using usury and other number games. They have not amassed wealth through providing value to the human race, such as by curing cancer or inventing teleportation, but by theft. They must be corrected, or everyone will fail.
Devise a better plan. Use your time and effort to describe it and market it. But don't defend the status quo from a place of abject apathy. That is inexcusable and worthy of a special place in Dante's Hell.
Washington DC delenda est.
(Score: 0) by Anonymous Coward on Thursday November 12 2015, @08:15PM
And your desire to cast it as a currency default does not make it one. Touche.
Cute. I broke down precisely why it is a currency default. Feel free to use a different set of terminology for monetary economics, but at least do the rest of the world the courtesy of telling us what your words mean.
So, since further down you challenge me to give a better solution (though to what isn't clearly specified), here's my challenge to you: describe, precisely and in detail, what your plan is, precisely why it does not constitute a currency default (including furnishing explanation of what you understand by terms such as `currency default' since apparently what you mean isn't what the rest of the world means) and to cap it all, precisely how your plan will ruin the wicked one percenters without screwing everybody else pitilessly?
There would have to be provisions to classify debt held by state actors differently from that held by private banks or individuals. That's part of the simple gloss I was referring to. But it's targeted to affect those who have squirrelled away ill-gotten gains in offshore banks, not those who have invested in good faith. It is targeted at those who have gamed the system, who represent a fraction of the world.
What you stated was a simple, straightforward, clearly stated deliberate repudiation of validly held money. If that is not what you meant, please supply the details which make it something else.
Yes, it is ruinous, for the 1%. But, then, they have quite ruined the mass of humanity for far too long using usury and other number games. They have not amassed wealth through providing value to the human race, such as by curing cancer or inventing teleportation, but by theft. They must be corrected, or everyone will fail.
Aaaaah, now we come to the real point. You want to ruin a bunch of people based on a moralistic judgement of their activities, presuming that they haven't delivered any value. Darned shame about guys like, say, Elon Musk, who's trying to push forward ecological responsibility as well as space exploration at the same time. But, the omniscient Phoenix666 declares that he's a useless parasite on humanity - off with his head! Or at least, his money.
Turns out that in the real world, that is precisely the sort of plan that ruins lots of little guys because the 1% (however you measure that nebulous category) have complex interdependencies with the rest of us poor schlubs.
"Hey, boss, when you paying our wages?"
"Sorry, can't, the government took the payroll money."
"Can you pay us in something else?"
"No, because the bottom dropped out of the market. We're liquidating, and someone from some other country that isn't run by kleptocrats will be your new boss. Bye, now!"
Devise a better plan. Use your time and effort to describe it and market it. But don't defend the status quo from a place of abject apathy. That is inexcusable and worthy of a special place in Dante's Hell.
A better plan for what, precisely? Breaking an economy? Good times!
Maybe you just want to be able to tax big, evil, mean, nasty, wicked corporate fatcats who are part of the big, evil, mean, nasty, wicked 1%?
Most straightforward solution is to tax economic activity rather than assets. You do business here? We tax the business activity as such.
Maybe you want to disown big, evil, mean, nasty, wicked corporate fatcats who are part of the big, evil, mean, nasty, wicked 1%?
You're still going to ruin the economy on an epic scale because subverting the notion of held property absent some kind of compensation, or justification in criminal law, is the kind of thing that breaks businesses - just ask the big successful businesses of sub-saharan Africa, where that kind of experiment has been tried.
(Score: 1) by khallow on Tuesday November 17 2015, @08:48PM
Me, I think the best solution to the problem is akin to what Germany did during reunification wherein they let people in the East exchange their money at a fixed rate up to a certain limit. So we figure out what the average cash holding of the middle class family is, set the ceiling at 150% of that, and let them exchange their old dollars for new dollars. Hey presto $21 trillion in ill-gotten gains suddenly becomes toilet paper. (so to speak--of course no one holds physical cash anymore)
Assets are valued in currency, but for the most part they are not the currency. The vast majority of the $21 trillion would remain untouched because nothing actually happened to it.