RHETORIC Vs. REALITY: For Ending Corporate Tax Havens, While Pushing Pact To Preserve Them

by: David Sirota

Mon May 04, 2009 at 18:55


Today, I read this:

NEW YORK (CNNMoney.com) -- President Obama on Monday spelled out his proposals to close corporate tax loopholes on U.S. multinational corporations and crack down on overseas tax havens.

But last week, I read this:

The White House's newly confirmed trade representative, Ron Kirk, indicated that was under consideration in a speech last week, saying "we believe there is strong bipartisan support for the pending free-trade agreement with Panama."

How are these two issues related? What's the contradiction between purporting to crack down on offshore tax havens while pushing the Panama Free Trade Agreement? Here's Dow Jones newswires to explain:

The Organization for Economic Cooperation and Development on April 2 listed Panama as one of 30 tax haven jurisdictions that have committed to international standards on bank secrecy, but have "not yet substantially implemented" those standards. Panama is also mentioned in legislation introduced by Sen. Carl Levin, D-Mich., with sanctions for tax haven jurisdictions.

I also read this from Public Citizen:

President Obama's ability to deliver on his campaign commitments to close tax loopholes that promote offshoring and re-regulate the financial sector would be dealt a sharp blow if the U.S.-Panama Free Trade Agreement (FTA) is passed, according to a Public Citizen report released today.

The new report details how Panama explicitly created an industrial policy designed to create a "comparative advantage" in tax-evasion and money-laundering services for entities such as the bailed-out American International Group (AIG) and Mexican and Colombian narcotraffickers. The report also examines how specific FTA rules would remove key policy tools - such as limitations on transfers from tax-haven countries that are used to combat financial crimes - and would also conflict with U.S. government efforts to combat the global economic crisis by re-regulating finance.

Sorry, but pretending to be for cracking down on tax havens while pushing a trade deal that rewards one of the biggest tax havens - and codifies that tax haven's laws into our international trade system - insults the public's intelligence.

David Sirota :: RHETORIC Vs. REALITY: For Ending Corporate Tax Havens, While Pushing Pact To Preserve Them

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RHETORIC Vs. REALITY: For Ending Corporate Tax Havens, While Pushing Pact To Preserve Them | 21 comments
I'm assuming you read this as well: (0.00 / 0)
The next big test for trade is Panama. Mr. Kirk said last week that the deal wasn't ready yet for a congressional vote, saying, "I'm working to resolve some labor and other issues before we ask Congress to consider it."

One wonders what those "other issues" are, especially in light of your post...  

Which is WA speak for the likes of (0.00 / 0)
"Blue Skies" and "Clean Water".  My biggest bitch is MI.   Our Democratic leaders cost me my primary vote because MI had such an important message to give to the party.  Well, I'd sure like to know what the hell it was.

We have the Obama Car Czar committee without any auto experts on it tearing apart our state.  He is asking MI, "what do you need?"   Instead of responding, jobs, single payer and you to keep your promise to renegotiate NAFTA, they are telling him we need more food banks, facilitated access to welfare and more job training funds for jobs that don't exist.

US offshores  22,000 green jobs to India
Noting an interesting irony the authors of the report say, "In the US, green stimulus plan is creating low-wage installation and construction jobs."  But, in India, which is usually associated with cheap and low-skill work, "...New green jobs include higher dollar engineers, strategic business management and support technicians charged with designing innovative environmental friendly solutions," they add.  - - -

[ Parent ]
Don't be sorry. (0.00 / 0)
Be angry.


Could you pls make your comments look less like an ad? (0.00 / 0)
Thank you.
[ Parent ]
Since I don't make them like that to begin with... (0.00 / 0)
Your request is moot.


[ Parent ]
"Don't make them like that"? Who inserted that big banner, the easter bunny? (0.00 / 0)
You're the only one going to such lengths of self-promotion that you insert a banner for your site in your comments! Do you have no sense of decency left, sir?
[ Parent ]
It's in my signature. Big deal. (0.00 / 0)
You're under no obligation to click the link or even read my comments, and I generally do not promote the web site in material I post here.  I don't see what the big deal is.  I suggest you thicken up that skin of yours and focus more on what people say, less on what's in their signatures.


[ Parent ]
Well, thx for changing your signature anyway! (0.00 / 0)
Sure, maybe I'm a bit too thinskinned about the constant bombardment with ads nowadays. But I really appreciate that you replaced your graphic sig for a conventional one. That's very courteous, thx!
[ Parent ]
When I saw the headline 2day that obama was going 2 crack down on tax havens, I was thinking ... (4.00 / 1)
... that it probably wouldn't amount 2 much and it looks like I was right.  U really can't be 2 cynical with these bastards especially with the most cynical democrat in dc, emanuel, running the show.  And I do mean show, coz that's all they really want 2 serve the American people: a fucking show while they maintain the current corrupt power order.

It's all about semantics, visuals, soundbites and headlines with this crew.  And apparently this is what obama wants becoz otherwise he wouldn't have hired emanuel coz this is what emanuel specializes in:  deceit.

Z

very good catch (0.00 / 0)
well done
They really do think we're stupid (0.00 / 0)
And judging by the market action after Obama's announcement, it's apparent Wall Street thinks it's bullshit too.

NIce catch.

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates

what public intelligence (0.00 / 0)
" insults the public's intelligence."

I cant believe how many stupid people i meet everyday, and i work at a college,

I am starting to think much of this country is as dumb as they think we are.

whatever you think people owe you, that is what you owe people

[ Parent ]
The two are not mutually exclusive. (0.00 / 0)

I guess they think they can keep getting away with this shit ... (0.00 / 0)
... and if they get in big hot water they'll just book the head pr man of the establishment on leno or letterman again to deflect the heat.  It worked with the aig bonus bs and they got thru that w/o correcting a damn thing so I guess they think they got themselves a blueprint.

Z

They won't get away with it if we point this out, (0.00 / 0)
It also helps we defeat free-trade agreement with Panama.
[ Parent ]
In fact we can defeat the free-trade agreement with Panama. (4.00 / 1)
if make the point about tax havens.
[ Parent ]
Like we beat the aig bonuses? (0.00 / 0)
U R right though in that it is possible, just not very probable with a president and a congress who act as if they have a corporate constituency.  At least the methods deployed by the left thus far have not been very successful in getting the gov't to represent them.

Z

[ Parent ]
Like we beat the aig bonuses? (0.00 / 0)
U R right though in that it is possible, just not very probable with a president and a congress who act as if they have a corporate constituency.  At least the methods deployed by the left thus far have not been very successful in getting the gov't to represent them.

Z

they left "transfer pricing" out of the "reforms" too -- (0.00 / 0)
http://www.nytimes.com/2009/05... -- Obama Plan Leaves One Path to Lower Taxes Wide Open --

...  The most widely used tactic not covered by the plan is known as transfer pricing, which multinational corporations employ routinely to reduce the taxes they owe to the United States by keeping their profits offshore in low-tax or no-tax havens.

The highly complex tactic has become a cause of growing concern within the Internal Revenue Service in recent years because it deprives the Treasury of billions of dollars a year, according to private-sector estimates. One senior government official briefed on the matter, who spoke on the condition of anonymity because he said he was not authorized to comment publicly, said on Monday that transfer pricing abuses were the single largest source of tax avoidance in corporate America.

Rosanne Altshuler, an economics professor at Rutgers, called transfer pricing "the elephant in the room" that was not addressed under the Obama plan.

Corporate America "will still have the ability to do and use transfer pricing - it's still there," said Robert Willens, an independent tax and accounting expert in New York. ...


VERY GOOD PRESIDENT (0.00 / 1)
Obama is very good president.

and this is the reality

This article is very useful and we can see about the tax probelm clearly and we can discuss abou it together.

Nice articles.

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this proposal (0.00 / 0)
needs to be supported....hard.  and the reason is the US Chamber of Commerce, NASSCOM, USINPAC, Compete America, ITAA (these are all corporate, national lobbyists) are now frothing at the mouth to stop it.

I have to dig into a real analysis on precisely how many jobs it could save, the tax shift....

but just beating down the corporate lobbyists is obviously a major war and they are all over FOX news, CNBC, etc. where they can prattle on about how this will "hurt the economy"...

So, it's going to be a war of corporations against US workers frankly, even when it's not that great of an effect....or Panama is slated to become the new Cayman's because of yet another bad trade deal.

I just did a blog piece, What's the Deal with that Little Tax Break to Offshore Outsource Your Job.  I will be posting much more on this assuredly.

NoSlaves.com  


The Economic Populist

RHETORIC Vs. REALITY: For Ending Corporate Tax Havens, While Pushing Pact To Preserve Them | 21 comments
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