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The views expressed by Andrew Quinlan and Dan Mitchell on this weblog are solely their own and are not necessarily those of their employers, The Center for Freedom and Prosperity Foundation and The Cato Institute, respectively. |
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The Market Center Blog |
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Observations and insights on the global fight |
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CF&P's Market Center Blog Archives |
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Friday, July 31, 2009 ~ 1:34 p.m., Dan Mitchell Wrote: With increasing taxes geared to the wealthy and the Bush tax cuts also coming off the books, it may be that the low tax states like Florida and Texas begin to have a big advantage over higher tax states when
it comes to NBA free agents. ...Could, in the end, the biggest barrier to the Bulls attracting a major free agent next summer like Dwyane Wade be the health care legislation now being debated in Washington?
...The answer is taxes. The closest anyone seems to a plan now to pay for the changes is to tax the so-called rich. That would include just about every player in the NBA. I know we're not supposed to feel sorry
for rich people and assume they have so much that giving up more doesn't matter. It does, just as comfortable people in the middle class with two cars and a nice health club membership don't want to pay more
taxes, either, even though they can afford to. So I contacted a tax expert in Chicago, Noel Wilner, president of CBIZ MHM, an accounting and tax advisory company, and asked him to do some calculations. The
assumption was single tax payer, the 2011 tax rates when the presumed five percent health care surtax would go into effect with the higher rates that year, salaries of $5.5 million, which is about the NBA
average, and $17 million, which would be a high earner like Wade and no deductions. ...The total tax for a $5,500,000 salary and an Illinois resident is $2,568,412. This is made up of $2,142,412 of federal
income tax, $261,000 of health care tax and $165,000 of Illinois tax. A Florida resident will have the same federal and health care tax but no state income tax ($165,000). The total tax for a salary of
$17,000,000 will be $8,088,412. That is made up of $6,696,412 of federal income tax, $882,000 of health care tax and $510,000 of Illinois tax. A Florida resident will have all the same tax except no state tax
($510,000). In addition, Wilner notes, there is typically an allocation to other states where the games are actually played. But there should be at least a savings of 50% of the state tax for being a Florida
resident as 50% of the games are home games. I know almost $9 million after taxes is a lot of money. But with the government adding on another half million dollars penalty to pay for health care and who knows
how much more down the road as the rich seem to be set up as the villains in this health care debate, suddenly hanging onto more than $500,000 in state tax may sound appealing. So perhaps someone like Wade sees
he can resign with his own team for an extra year under NBA rules and then get that much more in tax benefit, and maybe the money starts becoming too big to decide to leave? With increasing taxes geared to the
wealthy and the Bush tax cuts also coming off the books, it may be that the low tax states like Florida and Texas begin to have a big advantage over higher tax states. And then seemingly making it even less
appealing to go to a ridiculously high tax state like New York. Thursday, July 30, 2009 ~ 7:12 p.m., Dan Mitchell Wrote: The Science and Public Policy Institute announces the publication of Climate Money, a study by Joanne Nova revealing that the federal Government has a near-monopsony on climate science funding. This
distorts the science towards self-serving alarmism. ...The US Government has spent more than $79 billion of taxpayers' money since 1989 on policies related to climate change, including science and technology
research, administration, propaganda campaigns, foreign aid, and tax breaks. Most of this spending was unnecessary. Despite the billions
wasted, audits of the science are left to unpaid volunteers. A dedicated but largely uncoordinated grassroots movement of scientists has sprung up
around the globe to test the integrity of "global warming" theory and to compete with a lavishly-funded, highly-organized climate monopsony. Major errors have been exposed again and again. ...Meanwhile, in a
distracting sideshow, Exxon-Mobil Corp is repeatedly attacked for paying just $23 million to skeptics—less than a thousandth of what the US
government spends on alarmists... he large expenditure designed to prove the non-existent connection between carbon and climate has created a
powerful alliance of self-serving vested interests. ...Robert Ferguson, SPPI's president, says: "This study counts the cost of years of wasted Federal spending on the 'global warming' non-problem. Government
bodies, big businesses and environmental NGOs have behaved like big tobacco: recruiting, controlling and rewarding their own "group-think"
scientists who bend climate modeling to justify the State's near-maniacal quest for power, control, wealth and forced population reduction.
"Joanne Nova, who wrote our study, speaks for thousands of scientists in questioning whether a clique of taxpayer-funded climate modelers are
getting the data right, or just getting the "right" data. Are politicians paying out billions of our dollars for evidence-driven policy-making, or
policy-driven evidence-making? The truth is more crucial than ever, because American lives, property and constitutional liberties are at risk." Wednesday, July 29, 2009 ~ 6:51 p.m., Dan Mitchell Wrote: Face-lifts, tummy tucks and hair transplants could be hit with a new tax to help finance the trillion-dollar healthcare overhaul plan, according to
sources familiar with the Senate talks. The Senate Finance Committee has discussed imposing a 10 percent excise tax on cosmetic surgery deemed unnecessary for medical purposes. The idea was broached in a meeting
with OMB Director Orszag in mid-July, after which Senate Finance Chairman Max Baucus told reporters he had heard some "interesting,"
"creative," and "kind of fun" ideas. The tax, which has not been officially scored, would plug some of the revenue gap senators are seeking to fill to
keep on schedule for a markup the week of Aug. 3. It would target procedures prohibited under Section 213 of the tax code, which deals with
itemized deductions for medical expenses not covered by health insurance. The 1990 deficit-reduction law prohibited taxpayers from taking deductions for cosmetic surgery "unless the surgery or procedure is
necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or
trauma, or a disfiguring disease." The law defines cosmetic surgery as "any procedure which is directed at improving the patient's appearance
and does not meaningfully promote the proper function of the body or prevent or treat illness or disease." According to the IRS, deductions for
procedures such as reconstructive surgery due to cancer or laser eye surgery would be allowed. But nose jobs, liposuction, teeth-whitening procedures and Botox injections to smooth wrinkles would be prohibited
under Sec. 213 and subject to the new tax. Tuesday, July 28, 2009 ~ 7:34 p.m., Dan Mitchell Wrote: Gov. Bill Ritter turned down a $75-an-hour offer from the Colorado attorney general's office to handle legal matters regarding the disbursement of federal stimulus funds, instead hiring his former law
partners for up to six times that cost. ...Ritter hired Hogan & Hartson through a no-bid contract. So far, the firm has been paid $40,000 from
federal funds. Although Colorado has laws governing the circumstances under which the state can contract, the governor and other elected
officials are exempt. In 1941, the state legislature buried a sentence in an unrelated section of the law that essentially permits elected officials to
disregard procurement rules — including a requirement to seek multiple bids — when entering into contracts. ...The March contract between the
firm and the governor's office is vague. A letter attached to the contract says Hogan & Hartson will represent the governor's office in analyzing the
recovery act and help ensure that the state "receive and distribute its full share" of the funds. Other documents that may shed more light on the
work the firm is doing for taxpayers were withheld by the governor's office on the grounds of "attorney-client privilege." Monday, July 27, 2009 ~ 9:21 p.m., Dan Mitchell Wrote: Sunday, July 26, 2009 ~ 8:23 p.m., Dan Mitchell Wrote: All the problems with the American health care system come from government intervention, so naturally the Democrats' idea for fixing it is
more government intervention. This is like trying to sober up by having another drink. ...We already have near-universal health coverage in the
form of Medicare, Medicaid, veterans' hospitals, emergency rooms and tax-deductible employer-provided health care -- all government creations.
So now, everyone expects doctors to be free. People who pay $200 for a haircut are indignant if it costs more than a $20 co-pay to see a doctor.
The government also "helped" us by mandating that insurance companies cover all sorts of medical services, both ordinary -- which you ought to
pay for yourself -- and exotic, such as shrinks, in vitro fertilization and child-development assessments -- which no normal person would voluntarily pay to insure against. This would be like requiring all car
insurance to cover the cost of gasoline, oil and tire changes -- as well as professional car detailing, ...As a result, a young, healthy person has a
choice of buying artificially expensive health insurance that, by law, covers a smorgasbord of medical services of no interest to him ... or going
uninsured. People who aren't planning on giving birth to a slew of children with restless leg syndrome in the near future forgo insurance -- and then politicians tell us we have a national emergency because some
people don't have health insurance. The whole idea of insurance is to insure against catastrophes: You buy insurance in case your house burns
down -- not so you can force other people in your plan to pay for your maid. You buy car insurance in case you're in a major accident, not so
everyone in the plan shares the cost of gas. ...Even two decades after the collapse of liberals' beloved Soviet Union, they can't grasp that it's easier
and cheaper to obtain any service provided by capitalism than any service provided under socialism. You don't have to conjure up fantastic visions
of how health care would be delivered in this country if we bought it ourselves. Just go to a grocery store or get a manicure. Or think back to
when you bought your last muffler, personal trainer, computer and every other product and service available in inexpensive abundance in this
capitalist paradise. Third-party payer schemes are always a disaster -- less service for twice the price! If you want good service at a good price, be
sure to be the one holding the credit card. Under "universal health care," no one but government bureaucrats will be allowed to hold the credit
card. Isn't food important? Why not "universal food coverage"? If politicians and employers had guaranteed us "free" food 50 years ago,
today Democrats would be wailing about the "food crisis" in America, and you'd be on the phone with your food care provider arguing about
whether or not a Reuben sandwich with fries was covered under your plan. Instead of making health care more like the DMV, how about we make it more like grocery stores? Too bad Republicans can't be this articulate. But I guess that would require them to stop making the problem worse, as they did with their profligate Medicare expansion earlier this decade. Saturday, July 25, 2009 ~ 3:08 p.m., Dan Mitchell Wrote: Auto companies and eight of the country's biggest banks that received tens of billions of dollars in federal bailout money spent more than $20
million on lobbying Washington lawmakers in the first half of this year. General Motors, Chrysler and GMAC, the finance arm of GM, cut back
significantly on lobbying expenses in the period, spending about one-third less in total than they had in the first half of 2008. But the eight banks, the
earliest recipients of billions of dollars from the federal government, continued to rely heavily on their Washington lobbying arms, spending
more than $12.4 million in the first half of 2009. That is slightly more than they spent during the same period a year ago, according to a review of
congressional records. ...big banks traditionally are among the most active Washington lobbying interests in the financial industry, and the recession has done little to dent their spending. ...Since last fall,
companies receiving government funds have argued that none of the taxpayer money they were receiving was being spent on lobbying. ...Six of
the eight banks spent more to try to sway lawmakers in the first half of 2009 than over the same period in 2008, before the worst of the financial
crisis took hold. The eight banks include: Citigroup, JPMorgan Chase & Co, Bank of America, Goldman Sachs, Morgan Stanley, Wells Fargo, State Street and Bank of New York Mellon. JPMorgan was the top
spender, at $1.76 million in the second quarter and $3.07 million in first half of the year. That is roughly 20 percent more than the bank spent on
lobbying in the first half of 2008. Citigroup, which has yet to repay any of the $50 billion in bailout money it has received, was the second highest, at
$1.67 million in the quarter and $2.92 million in the first half. A spokesman for Citigroup declined to comment. ...American International
Group, the insurance firm crippled by trades in financial derivatives that received roughly $180 billion in bailout commitments, closed its
Washington lobbying shop earlier this year. AIG continues to spend money on counsel to answer requests for information from the federal government, but the firm said it does not lobby on federal legislation. The most absurd part of the story was the companies claiming that they did not use tax dollar for lobbying. I guess the corporate bureaucrats skipped the classes where their
teachers explained that money is fungible. The best part of the story was learning that AIG closed its lobbying operation, thought that does not mean much since AIG
basically now exists as a subsidiary of the federal government. The most important message (which is absent from the story, of course) is that the real problem is that
government is too big and that it intervenes in private markets. Companies would not need to lobby if government left them alone and/or did not offer them special favors.
Indeed, that was the key point of CF&P's video entitled, "Want Less Corruption: Shrink the Size of Government." Friday, July 24, 2009 ~ 8:16 p.m., Dan Mitchell Wrote: McDonald's is to leave London for Geneva, joining the growing ranks of US companies moving their European headquarters to take advantage of
preferential intellectual property tax laws. The fast-food group, which will open its head office in the Swiss city in the autumn, said the move had
been almost a year in the planning. The Swiss tax regime, particularly for intellectual property, has become increasingly attractive for foreign companies, particularly the regional European headquarters of US
multinationals. Kraft, Procter & Gamble, Google, Electronic Arts and Yahoo have switched from the UK to Switzerland in recent years, while
Informa, the UK publisher, is changing its tax domicile to the country. ...The growing success of Switzerland, Luxembourg and Ireland at attracting multinationals is causing disquiet in European centres such as
London... Under the UK tax rules that came into force at the start of the month, McDonald's would be paying tax on foreign profits relating to
intellectual property twice over. ...The issue of companies moving their main centre of operations outside the UK has dogged the UK Treasury. Mr Darling last year bowing to pressure and scrapped reforms to the
taxation of foreign profits that threatened to provoke an exodus of companies from the UK. Since the start of 2008, WPP, Shire, Regus, Henderson, Charter, Beazley, Brit Insurance and UBM have all announced
that they are moving their tax base out of the UK. Gordon Brown's Greed and Demagoguery Causing Investors and Entrepreneurs to Flee England. Gordon Brown Making England Less Competitive. Thursday, July 23, 2009 ~ 2:50 p.m., Dan Mitchell Wrote: NHS guidance is advising school pupils that they have a "right" to an enjoyable sex life and that regular sex can be good for their cardiovascular health. The advice appears in leaflets circulated to
parents, teachers and youth workers and is meant to update sex education by telling students about the benefits of enjoyable sex. The authors of the
guidance say that for too long, experts have concentrated on the need for "safe sex" and committed relationships while ignoring the principle
reason that many people have sex. ...The leaflet carries the slogan "an orgasm a day keeps the doctor away". It also says: "Health promotion
experts advocate five portions of fruit and veg a day and 30 minutes' physical activity three times a week. What about sex or masturbation twice a week?" Thursday, July 23, 2009 ~ 2:33 p.m., Andrew Quinlan Wrote: Ending a multiyear battle between Hollywood studios and telecommunications giants, the Supreme Court ruled Monday that cable operators could allow subscribers to store recorded shows on cable
systems' massive central databases instead of in set-top boxes. The ruling looks like a clear victory for subscribers of cable services, long frustrated
by awkward set-top box technology and perpetually rising subscription fees. By allowing cable operators to build video-storage units into their
networks, the Supreme Court has vastly reduced the cost of expanding DVR service, wrote Sanford C. Bernstein analyst Craig E. Moffett in a note to clients Monday. Today, cable systems have to provide costly
set-top boxes equipped with high-capacity hard drives to every new customer that signs up for DVR service. For customers lucky enough to already have a DVR box, the expense of new equipment has generally
blocked upgrades to bigger, more powerful devices. There are significant economies of scale in using a few giant servers to hold subscribers' videos,
and Moffett thinks the cable companies will expand their DVR offerings over a number of years. The lower costs of video storage could also spark
a mini-price war in markets where AT&T or Verizon compete with the local cable system. These telecoms have been rolling out cable-like television service and may take advantage of the improved economics of
offering DVR services to cut their prices. Wednesday, July 22, 2009 ~ 4:45 p.m., Dan Mitchell Wrote: The purpose of this announcement is to seek qualified contractors with the capability to provide presentations for The Department of Treasury,
Bureau of the Public Debt (BPD), Management Meeting with experience in meeting the objectives as described herein. The Contractor shall conduct two, 3-hour, Humor in the Workplace programs that will discuss
the power of humor in the workplace, the close relationship between humor and stress, and why humor is one of the most important ways that
we communicate in business and office life. Participants shall experience demonstrations of cartoons being created on the spot. The contractor
shall have the ability to create cartoons on the spot about BPD jobs. The presenter shall refrain from using any foul language during the presentation. This is a business environment and we need the presenter to
address a business audience. Tuesday, July 21, 2009 ~ 8:42 p.m., Dan Mitchell Wrote: The man who guided his varsity softball team to a 2A Western Region title this spring was terminated last week for violating a school alcohol policy.
In a phone interview Monday, Walkersville High School coach Brad Young acknowledged that a couple of parents brought beer to the annual post-season team cookout and pool party at his home in June -- a
violation of Frederick County Public School rules prohibiting alcohol at any school function. Young, in his fifth year as head softball coach, does
not work for the school system and said he was unaware that parents drinking at his home during a post-season team party constituted a violation of the alcohol-free, drug-free, tobacco-free school system rules.
...Young and team parents said none of the students at the party drank or had access to alcohol. The letter Young received from the school system
does not allege that any students drank or had access to alcohol at the party. None of the adults at the party were intoxicated, the parents and
coach said. ...Bob McNally, father of two players on this year's team, said he brought beer to the team function at Young's home, unaware it would
be a school system policy violation for the coach to permit it at a team party. "None of the students had access to alcohol or were drinking,"
McNally said in a phone interview Monday. "The girls simply had a lot of fun. And Brad (Young) did not drink. In no way shape or form did any
parents or school employee put any of the students in jeopardy or do anything illegal or immoral." McNally described Young as a "great role
model for those kids," and "a mentor who gives 150 percent" for the students-athletes in his charge. Monday, July 20, 2009 ~ 11:11 p.m., Dan Mitchell Wrote: Governor Deval Patrick yesterday accused Zoo New England officials of creating a false and inflammatory scare with their warning that state budget cuts may force them to close two Greater Boston zoos and
euthanize some animals. "As a supporter of the zoo and a parent who has visited often, the governor is disappointed to learn that Zoo New England
has responded to this difficult but unavoidable budget cut by spreading inaccurate and incendiary information,'' Kyle Sullivan, a spokesman for
the governor, said in a statement. And a second Patrick aide emphatically ruled out the killing of any animals. ...Zoo officials declined to comment
on Patrick's remarks yesterday. They also canceled a public event to welcome two French Poitou donkeys to the Franklin Park facility in honor of Bastille Day tomorrow. John Linehan, Zoo New England chief
executive, was scheduled to attend the event. ...On Friday zoo officials released a statement saying the funding reduction might require them to
shutter both zoos. Then on Saturday, they issued a statement that said state bureaucrats - and not animal-care professionals - would be responsible for deciding whether some animals would have to be killed if
the zoos closed. ...At least one visitor to the Franklin Park Zoo yesterday suggested the operator solve the budget crisis on its own. "I wonder why
the Franklin Park Zoo doesn't raise their prices so they can support themselves,'' said Emanuel Achidiev, 28. "They shouldn't have to rely on the state.'' Sunday, July 19, 2009 ~ 11:14 p.m., Andrew Quinlan Wrote: "The bill would treat any offshore hedge fund, offshore feeder fund, or offshore CDO vehicle with $50 million or more of gross assets that is
managed from within the United States (or any other foreign corporation with $50 million or more of gross assets that is "managed and controlled"
from within the United States) as a U.S. corporation for federal income tax purposes, and subject to federal corporate income tax. This provision
would be effective two years after enactment. This is a new provision. Although we believe that it is unlikely that the provision will be enacted in
its current form, if it were enacted, many U.S. managers would either be forced to withdraw from the management of foreign funds or conduct that management activity from London or another offshore location." Saturday, July 18, 2009 ~ 7:23 p.m., Dan Mitchell Wrote: They came in droves wearing dark suits and carrying résumés yesterday -- some lined up for a block in the hot sun waiting for the doors to open -- to
the only employer in this dismal economy hiring by the thousands: the federal government. More than 6,000 people jammed into the National Building Museum in Washington to apply for openings at 75 agencies,
including the departments of Treasury, Homeland Security, Justice, Veterans Affairs and Energy. ...in the government, added Shipp of Silver
Spring, "you get stability, you get great benefits and [an opportunity] to move up and progress in your job." The federal government represents
about one-third of the Washington region's $401 billion economy. Some analysts said they think the ramp-up in federal hiring and spending will
help the area emerge from the recession before most other metropolitan regions. From May 2008 to May 2009, the region lost 55,000 jobs. But during that same period, nearly 20,000 jobs were created, mainly in the
federal government and federal contracting sector. ...The Partnership for Public Service, a nonprofit that sponsored the job fair and is surveying
federal agencies to determine their staffing needs, estimates that the government will hire about 600,000 people over the next four years, as many as 120,000 of whom would work in the Washington region. The
federal workforce, currently at 1.9 million, is expected to grow to about 2.1 million during the Obama administration, according to the Partnership for Public Service. That is comparable to the staffing level
during the Johnson administration's Great Society programs of the 1960s. Friday, July 17, 2009 ~ 10:51 a.m., Andrew Quinlan Wrote: One of the largely-unrecognised factors that contributed to this renaissance is jurisdictional diversity. There are two specific reasons why
the existence of many nations (and territories with independent economic policies) has helped resuscitate the world economy. First, the world is a
laboratory and when different jurisdictions adopt different policies, they generate different results. This means real-world evidence that has a significant impact on the public policy debate. Thursday, July 16, 2009 ~ 3:02 p.m., Dan Mitchell Wrote: Development depends on good governance. ...Repression can take many forms, and too many nations, even those that have elections, are plagued
by problems that condemn their people to poverty. No country is going to create wealth if its leaders exploit the economy to enrich themselves... No
business wants to invest in a place where the government skims 20 percent off the top... No person wants to live in a society where the rule of
law gives way to the rule of brutality and bribery. That is not democracy, that is tyranny, even if occasionally you sprinkle an election in there. And now is the time for that style of governance to end. My initial reaction, focusing on the passage about 20 percent being too much for government, is to ask why Obama wants higher tax rates in America? After all, he wants American small businesses to pay 40 percent, which is twice the burden he thinks is excessive for Ghanians. Upon further reflection, though, I wonder if the President is referring to corrupt bureaucrats asking for bribes. But, even if that is the case, why does that matter? Investors and entrepreneurs care about the amount of disposable income that is generated by an investment. Losing 20 percent to the tax collector has a negative impact on incentives, regardless of whether the money winds up in Treasury coffers or a bureaucrat's pocket. In any event, it is good to see that the President recognizes that the economy suffers when government becomes too much of a burden. We just need to figure out how to convince him that the laws of economics work the same way in America as they do in Ghana. Thursday, July 16, 2009 ~ 2:13 p.m., Dan Mitchell Wrote: With the economy weak and the labor market continuing to decline, there is now talk of a second stimulus (which is actually the third, counting
President Bush's 2008 tax rebates). This would be a mistake. The truth is there hasn't been any stimulus to speak of so far this year. ...By June 26,
about $56 billion was spent on the stimulus from the American Recovery and Reinvestment Act of 2009, passed Feb. 17. ...even if we call all of the
$56 billion spending, it's still not enough to make a meaningful impact. By this point of the year in 2008, the Bush administration's tax-rebates got
out about $80 billion. Most economists believe the rebates had a positive but hardly dramatic effect on the economy. The Obama stimulus, being
significantly smaller, cannot possibly be expected to turn the economy around. The economy will improve. But it will do so because the financial
sector is recovering, largely due to the Fed policies to enhance liquidity and the success of the Bush administration's Troubled Asset Relief Program, continued by the Obama team, in helping to recapitalize the
banks. Wednesday, July 15, 2009 ~ 4:45 p.m., Dan Mitchell Wrote: I never could have imagined that, after living here for more than three decades, I would be filing a lawsuit against my beloved Los Angeles and
making plans for my company, Creators Syndicate, to move elsewhere. But we have no choice. The city's bureaucrats rival Stalin's apparatchiks
in issuing decrees, rescinding them, and then punishing citizens for having followed them in the first place. I founded Creators Syndicate in 1987,
and we have represented hundreds of important writers, syndicating their columns to newspapers and Web sites around the world. The most famous
include Hillary Clinton, who, like Eleanor Roosevelt, wrote a syndicated column when she was first lady. ...Other Creators columnists include Bill
O'Reilly, Susan Estrich, Thomas Sowell, Roland Martin and Michelle Malkin -- plus Pulitzer Prize-winning political cartoonists and your favorite comic strips. From the beginning, we've been headquartered in
Los Angeles. But 15 years ago we had a dispute with the city over our business tax classification. The city argued that we should be in an
"occupations and professions" classification that has an extremely high tax rate, while we fought for a "wholesale and retail" classification with a
much lower rate. ...Everything was fine until the city started running out of money in 2007. Suddenly, the city announced that it was going to
ignore its own ruling and reclassify us in the higher tax category. Even more incredible is the fact that the new classification was to be imposed
retroactively to 2004 with interest and penalties. No explanation was given for the new classification, or for the city's decision to ignore its 1994
ruling. Their official position is that the city is not bound by past rulings -- only taxpayers are. This is why we have been forced to file a lawsuit. We
will let the courts decide whether it is legal for adverse rulings to apply only to taxpayers and not to the city. ...Regardless of the outcome of our
case, the arbitrary and capricious behavior of some bureaucrats is creating a lose-lose situation for everyone involved. If we win in court, the
taxpayers of Los Angeles will have lost because all those tax dollars will have been wasted on needless litigation. If we lose in court, the remaining
taxpayers in Los Angeles will have lost because their burden will continue to swell as yet another business moves its jobs -- and taxpayers -- to another city. Tuesday, July 14, 2009 ~ 11:23 a.m., Dan Mitchell Wrote: The old hands of the Clinton health fight know there never was uniform opposition to the government plan. Plenty of bigger players figured they
could craft the regulations for bigger profits. In 1993 a number of insurance giants cut ties with their trade group, the Health Insurance Association of America (HIAA). Prudential, Cigna and others were
salivating over Clinton proposals to pay for insurance for millions of uninsureds. The giants were in line to suck up these customers. They didn't
appreciate the grousing of smaller association members who opposed regulations that would crowd them out. Representing many HMO biggies was a one-time AFL-CIO employee named Karen Ignagni. While the rump
HIAA was running its Harry & Louise ads, others like Ms. Ignagni were running with the Clintons to craft a regulation to the big insurers' liking.
The insurers have today reunited under a group called America's Health Insurance Plans. Its CEO? Ms. Ignagni. She, along with Billy Tauzin, head of the Pharmaceutical Research and Manufacturers of America, the
American Hospital Association's Rick Umbdenstock, and others are back in Washington convinced they can outsmart, or at least outrun, the politicians. Democrats are happy to let them think so. The industry's
calculation is that by cutting deals, it can set the terms of its contributions to "reform" and even wangle upsides. The insurers came first, promising
to squeeze $2 trillion in costs out of the system. Democrats are letting Ms. Ignagni believe that in return she'll get a mandate to require all
Americans to carry insurance (which her members will supply), and be spared a public option (which would decimate her industry). ...Democrats have complemented their smiling encouragements with behind-the-scenes
threats. After retaking the House in 2006, the party made clear that companies that did not hire Democratic lobbyists would not get a hearing
in Washington. The ruling party is now seeing the fruits of its bullying. These days, a meeting of health-care lobbyists is better described as a reunion of Senate Finance Chairman Max Baucus's former aides.
Health-care lobbying has been turned on its head: The new cabal of Democratic lobbyists does not exist to protect the industry from Congress. It exists to present Democratic ultimatums to business. ...Liberal
Democrats intend to make the private sector fund their plans. They figure by the time they drop a bill that contains odious elements, it'll be too late
for any industry player -- big or small -- to cut a Harry & Louise ad. Industry players this week got a glimpse of how they will be treated. House Energy and Commerce Chairman Henry Waxman dismissed the
$80 billion drug deal, claiming it did not have House support, and moreover that the White House "told us they're not bound to that agreement." ...The question is just how long it is going to take for
America's health-care CEOs to realize they are being taken for a ride, both by Congress and their own lobbyists. Americans are wary enough about ObamaCare to maybe appreciate some straight talk from corporate
America. If only corporate America can find the smarts to give it. Tuesday, July 14, 2009 ~ 10:51 a.m., Dan Mitchell Wrote: Last week the Social Security Administration flew approximately 700 of its managers from across the U.S. and Guam to Phoenix, Arizona's posh
Arizona Biltmore Hotel and Resort, for "organizational training." The event, which included musical entertainment and dancing, skits, catered
food, cocktails, and a "casino night" featuring "door prizes," cost us lowly taxpayers approximately $750,000. ...Ignore the fact that SSA is
estimated to waste hundreds of millions of taxpayer dollars each year in faulty overpayments." ...forget all that stuff. Pay no attention to the fact
that our government is bankrupt. The managers of our Social Security Administration needed to get out of the office, come together face-to-face,
let their hair down and have some fun together, do some "team building," and get trained on how to "reduce workplace stress." And when William
La Jeunesse of the Fox News Channel showed up at the resort asking to speak to the SSA, the childish incompetence of our public servants was
put on display for all the nation to see. ...So La Jeunesse wanted to know why the SSA's taxpayer funded retreat was okay, when the AIG Corporation's retreat was not. "There's a clear distinction between the
two" SSA Spokesperson Peter Spencer explained. "They (the AIG Corporation) received specific bailout funds, we did not…" Mr. Spencer was, of course, playing the American people for fools. Whether you call it
"bailout funds" or an operating budget, government money is our money, the people's money. All the money that government possess comes from our tax payments. And while American workers in the "real world" face
layoffs, pay-cuts, the elimination of expense accounts, and moratoriums on corporate travel and entertainment ( wasn't the annual "holiday party" eliminated at your place of employment a year or two ago?), it is
disgraceful that government employees think its okay to sit in the lap of luxury at our expense. Monday, July 13, 2009 ~ 7:34 p.m., Dan Mitchell Wrote: In February 2008, President George W. Bush and Speaker Nancy Pelosi, who normally were at daggers drawn, agreed that a $168 billion stimulus
-- this was Stimulus I -- would be the "booster shot" the economy needed. Unemployment then was 4.8 percent. In January, the administration,
shiny as a new dime and bursting with brains, said that unless another stimulus -- Stimulus II wound up involving $787 billion -- was passed immediately, unemployment, which then was 7.6 percent, would reach 9
percent by 2010. But halfway through 2009, the rate is 9.5. For the first time since the now 16-nation Eurozone was established in 1999, the unemployment rate in America is as high as it is in that region, which
Americans once considered a cautionary lesson in the wages of sin, understood as excessive taxation and regulation. ...while government diminishes America's comparative advantages, liberals are clamoring for
... higher taxes. Partly because of changes endorsed by presidents from Ronald Reagan to Barack Obama, approximately 60 percent of taxpayers
now pay either no income tax (43 percent) or less than 5 percent of their income. Because one cannot raise significant money by that tax without
nicking the middle class, or without bringing millions of people back onto the income tax rolls, attention is turning to a value-added tax. A VAT is
levied at every stage of production. Like the cap-and-trade regime being constructed, a VAT is a liberal politician's delight: It taxes everything, but opaquely. Monday, July 13, 2009 ~ 7:11 p.m., Dan Mitchell Wrote: The Massachusetts law, which was championed by former GOP Governor Mitt Romney, imposed an individual mandate, requiring nearly all residents to buy health insurance or else pay a penalty. (The exceptions
are those who qualify for the state's public program.) This was supposed to cover everybody and save money too. We've written before about how costs have exploded, but it also turns out that consumers have other
ideas. For 15 years Massachusetts has also imposed mandates known as guaranteed issue and community rating -- meaning that insurers must cover anyone who applies, regardless of health or pre-existing conditions,
and also charge everyone the same premium (or close to it). Yet these mandates allow people to wait until they're sick, or just before they're
about to incur major medical expenses, to buy insurance. This drives up costs for everyone else, which helps explain why small-group coverage in
Massachusetts is so much more expensive than in most of the country. Mr. Romney argued -- as Democrats are arguing now -- that the individual mandate would make that problem disappear, since everyone is always
supposed to be covered. Well, the returns are rolling in, and a useful case study comes from the community-based health plan Harvard-Pilgrim.
CEO Charlie Baker reports that his company has seen an "astonishing" uptick in people buying coverage for a few months at a time, running up
high medical bills, and then dumping the policy after treatment is completed and paid for. Harvard-Pilgrim estimates that between April 2008 and March 2009, about 40% of its new enrollees stayed with it for
fewer than five months and on average incurred about $2,400 per person in monthly medical expenses. ...To one degree or another all insurance
pools require the younger and healthier to subsidize the older and sicker, though part of the risk-sharing bargain is the hedge against unanticipated
or future health problems -- i.e., true insurance. The combination of guaranteed issue and community rating actively encourages parts of the healthier population to forgo coverage and thus blow up voluntary risk
pools. No doubt our politicians will conclude that the solution is to raise the penalty for going uninsured, though it would be easier and more rational to let insurance markets function without mandates. Sunday, July 12, 2009 ~ 5:55 p.m., Dan Mitchell Wrote: Area drivers looking to outwit police speed traps and traffic cameras are using an iPhone application and other global positioning system devices
that pinpoint the location of the cameras. That has irked D.C. police chief Cathy Lanier, who promised her officers would pick up their game to
counteract the devices... Lanier said the technology is a "cowardly tactic" and "people who overly rely on those and break the law anyway are going
to get caught" in one way or another. The greater D.C. area has 290 red-light and speed cameras -- comprising nearly 10 percent of all traffic
cameras in the U.S., according to estimates by a camera-tracking database called the POI Factory. ...Photo radar tickets generated nearly $1 billion in revenues for D.C. during fiscal years 2005 to 2008. Saturday, July 11, 2009 ~ 6:54 p.m., Dan Mitchell Wrote: Mass transit needs mass to work: enough people must live and work near train stations and bus stops. Densely populated Eastern Massachusetts
should therefore be a prime location for public transportation. Yet the MBTA faces budget woes and has threatened to close train stops. Despite
the difficulties trains face in urban Boston, the Obama administration is pushing a new transportation agenda that promises high-speed rail in unlikely spots like Alabama and Oklahoma....Per capita federal
transportation spending in the 10 densest states, which include Massachusetts, is less than half of spending in the 10 least-dense states. ...Now the administration wants Americans to envision high-speed rail
lines in the wide-open spaces of Texas. ...Despite investments in speedy Acela trains, politics and right-of-way problems mean that those trains
take 210 minutes to travel the 200 miles between Boston and New York. Those problems are unlikely to vanish....There is a reason why 48 percent
of Amtrak's passengers travel on only two routes: the Northeast Corridor and the Los Angeles-San Diego line. For travelers in the less-dense areas
between the coasts, cars beat trains for modest distances and planes win over long hauls.The national high-speed rail agenda is being pushed with
claims that these trains will jump-start economic growth. No serious evidence supports such claims. When new transportation does affect local economies, it generally does so by moving activity from one place to
another, not by creating nationwide benefits....Amtrak also regularly faces a $1 billion gap between revenues and expenses, including depreciation,
but since Amtrak carries only 29 million passengers each year, the per-trip subsidy tops $30....intercity rail travelers are wealthier than car travelers. Friday, July 10, 2009 ~ 7:23 p.m., Dan Mitchell Wrote: Tim Hortons Inc, the largest fast- food chain in Canada, filed to reorganize as a Canadian company to lower its tax rate. Tim Hortons, which presently operates out of Oakville, Ontario, will become a unit of a
Canadian-based parent with the same name, the company said today in a statement. Its current parent is based in Delaware. The coffee and doughnut seller began looking at moving its registration in the fourth
quarter of 2008 as a way to cut its tax rate. This may be the beginning of a trend. Reuters reports that Canadian lawamkers are advertising the fact that they have a more market-friendly system, and they hope to lure more firms north of the border: Other companies are likely to follow Tim Hortons Inc in moving their corporate structures to Canada to take advantage of a falling corporate
tax rate, Finance Minister Jim Flaherty said on Friday. The coffee shop chain said last month it applied with U.S. regulators to return to its
Canadian corporate roots through a reorganization to benefit from lower taxes. Flaherty told reporters on a conference call from Chile, that he
hoped the provinces would follow in the footsteps of the Conservative federal government and commit to reducing their tax rates to 10 percent
by 2012. The federal government has pledged to reduce its corporate tax rate to 15 percent by that year, for a combined rate of 25 percent. "I'm
optimistic that we're going to get to that 25 percent (corporate) tax rate, federal and provincial, by 2013 or so," he said. "That gives us an
opportunity to brand Canada at a corporate tax rate of 25 percent globally. So that's the goal." Thursday, July 9, 2009 ~ 9:32 p.m., Dan Mitchell Wrote: Switzerland said it would seize UBS AG data to prevent the U.S. Justice Department from pursuing a U.S. court order seeking the identities of 52,000 American account holders in a crackdown on tax evaders. The
assertion came in court papers yesterday in federal court in Miami, where the Justice Department sued UBS on Feb. 19, a day after the bank avoided U.S. prosecution for helping wealthy Americans evade taxes. The
U.S. effort to enforce a summons seeking the names would force UBS to violate Swiss laws barring disclosure of such data, the filing said. The
Swiss government "will use its legal authority to ensure that the bank cannot be pressured to transmit the information illegally, including if
necessary by issuing an order taking effective control of the data at UBS that is the subject of the summons," according to the filing. ..."It is hoped
that it will be unnecessary for the Government of Switzerland to take the extraordinary action of issuing an order to seize the information at issue,
but such an action should be expected if the IRS continues to pressure UBS to violate Swiss law," according to the filing. Wednesday, July 8 2009 ~ 11:11 p.m., Dan Mitchell Wrote: The U.S Supreme Court's 1992 Quill decision forbids states from forcing tax-collection obligations on out-of-state merchants, but Tarheel
legislators still want Amazon and other online retailers to start taxing their constituents. The Seattle-based retailer has no physical presence in
the state, but a pending North Carolina bill holds that since affiliate Web sites in the state link customers to Amazon, the company is now responsible for extracting cash from Carolina shoppers. Other proposed
North Carolina legislation would apply a new tax only to Internet ticket resales, in direct defiance of the federal Internet Tax Freedom Act, which
prohibits taxes that target the Internet with burdens not applied offline. To its credit, Amazon yesterday refused to accept the expected new
compliance burden and announced the cancellation of its North Carolina affiliate relationships. Said the company, "This is a direct result of the
unconstitutional tax collection scheme expected to be passed any day now by the North Carolina state legislature (the General Assembly) and signed
by the governor." So now the state won't get the revenue, even as in-state Web retailers lose their ties to Amazon thanks to the legislature's revenue grab. Brilliant. Tuesday, July 7, 2009 ~ 4:42 p.m., Dan Mitchell Wrote: Today, the U.S. ranks next to last among the 28 Organization for Economic Cooperation and Development nations in total federal revenue as a share of GDP. Our federal revenues represent 18% of national
output, down from 20% just 10 years ago. That makes the mismatch between our spending and our revenue very large, producing the huge deficits we face. We all know the recent and bitter history of tax struggles
in Washington, let alone Mr. Obama's pledge to exempt those earning less than $250,000 from higher income taxes. This suggests that, possibly next
year, Congress will seriously consider a value-added tax (VAT). ...This challenge may be the toughest one Mr. Obama faces in his first term. Fortunately, the new president is enormously gifted. That's important,
because it is no longer a matter of whether tax revenues must increase, but how. Monday, July 6, 2009 ~ 5:11 p.m., Dan Mitchell Wrote: In England, health care is "free" -- as long as you don't mind waiting. People wait so long for dentist appointments that some pull their own
teeth. At any one time, half a million people are waiting to get into a British hospital. A British paper reports that one hospital tried to save
money by not changing bedsheets. Instead of washing sheets, the staff was encouraged to just turn them over. ..."People line up for care, some of
them die. That's what happens," says Canadian doctor David Gratzer, author of "The Cure". He liked Canada's government health care until he
started treating patients. "The more time I spent in the Canadian system, the more I came across people waiting for radiation therapy, waiting for
the knee replacement so they could finally walk up to the second floor of their house." "You want to see your neurologist because of your stress
headache? No problem! Just wait six months. You want an MRI? No problem! Free as the air! Just wait six months." ...In America, people wait
in emergency rooms, too, but it's much worse in Canada. If you're sick enough to be admitted, the average wait is 23 hours. ...Shirley Healy, like
many sick Canadians, came to America for surgery. Her doctor in British Columbia told her she had only a few weeks to live because a blocked artery kept her from digesting food. Yet Canadian officials called her
surgery "elective." ..."[America] is the country of medical innovation. This is where people come when they need treatment," Dr. Gratzer says.
"Literally we're surrounded by medical miracles. Death by cardiovascular disease has dropped by two-thirds in the last 50 years. You've got to pay a
price for that type of advancement." Canada and England don't pay the price because they freeload off American innovation. If America adopted
their systems, we could worry less about paying for health care, but we'd get 2009-level care -- forever. Government monopolies don't innovate.
Profit seekers do. We saw this in Canada, where we did find one area of medicine that offers easy access to cutting-edge technology -- CT scan,
endoscopy, thoracoscopy, laparoscopy, etc. It was open 24/7. Patients didn't have to wait. But you have to bark or meow to get that kind of
treatment. Animal care is the one area of medicine that hasn't been taken over by the government. Dogs can get a CT scan in one day. For people, the waiting list is a month. Monday, July 6, 2009 ~ 4:54 p.m., Dan Mitchell Wrote: Spending by lawmakers on taxpayer-financed trips abroad has risen sharply in recent years, a Wall Street Journal analysis of travel records
shows... The spending on overseas travel is up almost tenfold since 1995, and has nearly tripled since 2001, according to the Journal analysis of
60,000 travel records. Hundreds of lawmakers traveled overseas in 2008 at a cost of about $13 million. That's a 50% jump since Democrats took control of Congress two years ago. ...The Journal analysis, based on
information published in the Congressional Record, also shows that taxpayer-funded travel is a big and growing perk for lawmakers and their
families. ...Although complete travel records aren't yet available for 2009, it appears that such costs continue to rise. The Journal analysis shows
that the government has picked up the tab for travel to destinations such as Jamaica, the Virgin Islands and Australia's Great Barrier Reef.
Lawmakers frequently bring along spouses on congressional trips. If they take commercial flights, they have to buy tickets for spouses. If they fly on
government planes -- as they usually do -- their spouses can fly free. ...In mid-June, Sen. Daniel Inouye (D., Hawaii) led a group of a half-dozen
senators and their spouses on a four-day trip to France for the biennial Paris Air Show. An itinerary for the event shows that lawmakers flew on
the Air Force's version of the Boeing 737, which costs $5,700 an hour to operate. They stayed at the Intercontinental Paris Le Grand Hotel, which
advertises rooms from $460 a night. ...Often, lawmakers combine trips to war zones with visits to more tranquil spots. In February, House Speaker
Nancy Pelosi led a delegation of Democratic lawmakers to visit U.S. troops in Afghanistan for a day. Before landing in Kabul, the eight lawmakers and their entourage of spouses and aides spent eight days in
Italy, spending $57,697 on hotels and meals. ...The Air Force maintains a fleet of 16 passenger planes for use by lawmakers. Sunday, July 5, 2009 ~ 9:54 p.m., Dan Mitchell Wrote: ...two years ago Mr. Crist gave a big gift to coastal property owners by converting the state of Florida into one of the world's largest property
insurers. The Citizens Property Insurance Corporation provides below market-rate insurance policies directly to homeowners. Meanwhile, the Florida Hurricane Catastrophe Fund (CAT) regulates how much private
insurers can charge homeowners and requires companies to purchase low-cost reinsurance from the government. Mr. Crist didn't invent these programs, but he vastly expanded their reach -- to about one million
policies today. He transformed Citizens from insurer of last to first resort. Here's the problem: This system isn't even within a coastal mile of being
actuarially sound. The state government acknowledges that in many high-storm risk areas the premiums are from 35% to 65% below what is needed to cover potential claims. That subsidy has made Mr. Crist
popular with many coastal residents even as the state plays Russian roulette with the weather. ...the Governor claims people can't afford
"large and unpredictable" increases in premiums. The truth is large increases are precisely what is sometimes needed to cover the risk of
living on coastal property. Mr. Crist's program makes the long-term losses much more severe because cut-rate insurance has encouraged overbuilding in coastal areas that are historically in the path of
hurricanes. "We are one major hurricane away from an economic disaster in this state," says House bill sponsor William Proctor. Mr. Crist is also
pushing a federal disaster-insurance fund, probably because he knows the risks he's taking and wants all American taxpayers to bail out his Florida
schemes when future hurricanes hit. Meantime, he continues to perpetuate the myth that Florida property owners can have billions of dollars of subsidized insurance at little expense or risk. It's this kind of
something-for-nothing economics that gave us the debacle of Fannie Mae. With that philosophy, Mr. Crist would feel right at home in Washington. Saturday, July 4, 2009 ~ 2:56 p.m., Dan Mitchell Wrote: A flat income tax plan that is part of budget plans being crafted by the Arizona Legislature and Gov. Jan Brewer would take Arizona's five personal income tax brackets down to one rate of between 2.6 percent
and 3 percent and substantially cut corporate income tax rates. ...The state's personal income tax rates range from 2.59 percent to 4.54 percent,
depending on income. A flat personal income tax would take those to 3 percent or likely lower, said Tom Jenney, state director of Americans for
Prosperity. ...Jenney like the idea of a flat tax but points out the budget deal would have come into play in later years, likely 2012, while Brewer
wants voters to approve a 1-point increase to the state's 5.6 percent sales tax. "That sounds like a bad deal," said Jenney comparing the sales tax
increase to the flat tax plan. ..."A flat tax would be a boon for the state's economy," said Steve Voeller, president of the Arizona Free Enterprise
Club. "A single rate of no higher than 3 percent would make Arizona's tax system one of the most competitive in the U.S.," said Voeller. Friday, July 3, 2009 ~ 3:33 a.m., Dan Mitchell Wrote: Some terminally ill patients in Oregon who turned to their state for health care were denied treatment and offered doctor-assisted suicide instead, a
proposal some experts have called a "chilling" corruption of medical ethics. Since the spread of his prostate cancer, 53-year-old Randy Stroup
of Dexter, Ore., has been in a fight for his life. Uninsured and unable to pay for expensive chemotherapy, he applied to Oregon's state-run health
plan for help. Lane Individual Practice Association (LIPA), which administers the Oregon Health Plan in Lane County, responded to Stroup's request with a letter saying the state would not cover Stroup's
pricey treatment, but would pay for the cost of physician-assisted suicide. "It dropped my chin to the floor," Stroup told FOX News. "[How could
they] not pay for medication that would help my life, and yet offer to pay to end my life?" Thursday, July 2, 2009 ~ 11:23 p.m., Dan Mitchell Wrote: The average citizen had to conclude that most big U.S. companies are tax cheats. Only a dedicated student of accounting would figure out that the
term "tax haven" as defined by the Treasury Department means any country with a lower corporate tax rate than America's, which is all
countries except Japan. The reality is that the administration is lashing out against perfectly legal behavior. A U.S. company that makes money in
Country X pays Country X's taxes on that money. If the company ever brings the money back to the United States, it must also pay the tax that
would be due under America's higher rate. The administration argues that because the United States has almost the world's highest corporate tax
rate (and even Japan's is only a fraction of a point higher), current rules create incentives for U.S. companies to operate anywhere but here, at the
cost of U.S. jobs. The White House therefore proposes charging all American companies full freight -- the whole difference between their overseas taxes and the U.S. corporate rate -- on all their profits as soon
as they're earned, no matter where. This measure, in their minds, would bring jobs home. If the logic eludes you, you're not alone. The bottom-line
effect of the change would be a steep tax hike -- more money vacuumed out of corporate coffers. Would that make U.S. companies competing in a global economy more inclined to hire additional workers in the highly
expensive United States? The answer is clear. It's why Microsoft chief executive Steve Ballmer said recently that if the change is enacted, "we're
better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S." ...Tax-wise, a company is just a
bunch of incorporation papers; all taxes are paid by people -- customers, shareholders and employees. And guess who would bear most of the burden of these tax increases? It's the U.S. employees of the companies
being taxed. Research has shown that when business taxes are raised by a dollar, 70 to 92 cents comes out of employees' pay. When workers wake
up to that fact, they may decide this is one time they don't want the White House beating up on business. Wednesday, July 1, 2009 ~ 5:09 p.m., Dan Mitchell Wrote: UBS AG and Credit Suisse Group AG, the country's biggest banks, have told Americans to move their money into specially created units registered
in the U.S., or lose their accounts. Smaller private banks such as Geneva-based Mirabaud & Cie. are closing all accounts held by U.S. taxpayers. While the banks declined to say how many people are affected,
more than 5 million Americans live abroad, including about 30,000 in Switzerland, according to estimates from American Citizens Abroad in Geneva. Swiss banks must register with the Securities and Exchange
Commission to provide services for those customers. "My bank doesn't want to do that, so we wouldn't accept an investment account for a U.S. person," said Pierre Mirabaud, chairman of Mirabaud & Cie. and the
Swiss Bankers Association, during a lunch at the American International Club of Geneva. ...The U.S. has also proposed increasing reporting and
oversight requirements for so-called qualified intermediaries -- foreign banks that withhold taxes on behalf of the IRS. That may increase the cost
of compliance and the risk of violating U.S. laws, said Charles C. Adams, managing partner at the law firm Hogan & Hartson LLP in Geneva.
"American citizens are starting to feel like they're Typhoid Mary," said Adams who hosted a 2008 fundraiser for Barack Obama that featured actor George Clooney. "The Swiss simply don't want American customers
because it requires so much infrastructure and hassle that they don't make any money." Sandra Dysli, an American who has lived in Geneva for 40 years, said Bank Zweiplus AG, the Zurich-based joint venture of
Basel-based Bank Sarasin & Cie. and AIG Private Bank, and a Geneva branch of Raiffeisen International Bank-Holding AG refused to open investment accounts for her. ...Two members of the U.S. Congress,
Carolyn Maloney and Joe Wilson, wrote a May 27 letter to Treasury Secretary Timothy Geithner saying that if the QI requirements are extended to cash or deposit accounts, "taxpaying Americans living
abroad will have no place to bank." "If neither foreign nor American banks will take American customers, how will the millions of citizens living abroad bank?" wrote Maloney, a New York Democrat, and Wilson,
a South Carolina Republican, who are co-chairmen of the Americans Abroad Caucus. ..."The presumption is that you're a bad person avoiding taxes if you live overseas," according to Andy Sundberg, who founded
Geneva-based American Citizens Abroad in 1978. "The IRS rhetoric is alienating and vindictive."
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