Jason DeBacker (Middle Tennessee State), Bradley T. Heim (Indiana), Anh Tran (Indiana) & Alexander Yuskavage (Office of Tax Analysis, U.S. Treasury Department), Once Bitten, Twice Shy?: The Lasting Impact of IRS Audits on Tax Compliance, 61 J.L. & Econ. 1 (2018):
This paper studies the impact of tax enforcement activity on subsequent individual taxpaying behavior. We exploit four waves of randomized Internal Revenue Service (IRS) audits of individual income tax filers during the 2006-2009 period to study both the short and long run effects of audits on taxpaying behavior. Rich and confidential IRS data allow us to show the differential impact of audits across sources of income and deductions. The results highlight how the effects of audits on subsequent compliance behavior are impacted by other aspects of tax policy.
'Prepare to die': Trump's longtime ally Roger Stone arrested in Russia probe
The right-wing provocateur allegedly called an associate "a rat", threatened his dog and invoked The Godfather Mafia movies in a bid to stop him from testifying.
Illinois Supreme Court rules against Six Flags in lawsuit over fingerprint scans. Here’s why Facebook and Google care. Chicago Tribune. Hooray.
Some lawmakers are already raising concerns about Facebook’s plans to merge its messaging apps Business Insider
ANDY KESSLER: Strike Back Against Every Cyberattack: The U.S. can keep foreign hacks at bay by showing its ability and will to retaliate.
Another week, another data breach. The latest is 773 million online accounts for sale, many with passwords included, known as Collection #1. More are likely to come—go ahead and check your status at HaveIBeenPwned.com. All this the same month Marriott admitted that five million unencrypted passport numbers were snatched from its system, probably by the Chinese. Oh, and the Russians might have hacked the Democratic National Committee again after the 2018 midterms. How do we stop this?
The foreign hacks are the most disturbing. Last month members of a Chinese espionage ring known as Advanced Persistent Threat Group 10 (a k a “Godkiller” and “Stone Panda”) were charged by the Justice Department with hacking NASA, the Jet Propulsion Laboratory and even IBM . Earlier last year the Chinese were caught stealing submarine data from a U.S. Navy contractor. And horror of horrors, in 2017 an Iranian national hacked HBO and threatened to release unaired episodes and plot summaries from “Game of Thrones.”
The U.S. has done close to nothing in response. Sure, special counsel Robert Mueller indicted 12 Russian intelligence officers last summer. I’m sure they’re quaking in their boots. Maybe those “Game of Thrones” episodes could have taught our leaders something about retaliation and revenge.
So what is America’s policy? That’s unclear. But a good start would be to heed the words of Israeli Prime Minister Benjamin Netanyahu, who told the press last week that his state has a permanent policy of hurting “everyone who is trying to hurt us.” The U.S. needs a similar stance to halt cyberattacks.
John Yoo, a Berkeley law professor and former Justice Department official, sees a parallel between deterrence in cyber and nuclear warfare. “Offensive nuclear weapons are relatively cheap,” he explains to me: “It’s defensive systems that are expensive.” Think about it. Each mission to drop one nuclear bomb would cost the U.S. about a quarter-billion dollars. But we’ve spent trillions on our defense and deterrent system. The nuclear triad of intercontinental ballistic missiles, bombers and subs ain’t cheap.
Mr. Yoo continues: “Similarly, offensive cyber weapons are cheap. It’s defensive cybersecurity tools that are expensive.” The cybersecurity market is estimated at $125 billion, and it gets bigger with each successive hack. Government and private firms have ramped up spending on encryption, firewalls, malware and virus protectors, intrusion detectors—it’s an arms race. Yet we’re still vulnerable.
We need a shift in strategic thinking. So where is our Herman Kahn? Kahn was the author of “On Thermonuclear War” and the father of the massive-retaliation plan for nuclear deterrence. If the Soviets knew the U.S. had a second-strike capability, Kahn argued, there would be no first strike. Mutual assured destruction—peculiarly, a term that was coined by the father of computer architecture, John von Neumann—works as a deterrent. Or it has so far anyway.
Washington should commit to use its weapons against all aggressors.
Why haven’t we done so already?
ICAC probes Sydney Uni 'security scam'
NSW's anti-corruption watchdog is probing allegations that private security guards at the University of Sydney have been submitting fake timesheets for a decade.
“Business Roundtable today released “Innovation Nation: An American Innovation Agenda for 2020,” a set of policy recommendations to secure U.S. leadership in innovation, maintain a robust U.S. economy and increase living standards for all Americans through 2020 and beyond. Innovation Nation—a cross-cutting policy agenda—provides a roadmap for the U.S. to effectively continue to compete for and win the global race for innovation to secure inclusive economic growth and opportunity for Americans. In a rapidly changing world, the U.S. must reaffirm its commitment to innovation and how American workers across all sectors can succeed in a future economy.
Auren Hoffman on VC and private equity
“Cambridge creative-arts students have a-level scores close to those of economics students at Warwick, but earn about half as much. That is tantamount to giving up an annuity worth £500,000.” (The Economist)
Axios: “An Axios study shows that very few news organizations — around 6% of a broad sample — successfully use a critical technology that guarantees emails they send are authentic. The big picture: We’ve written before about the Department of Homeland Security’s struggle to get federal agencies and the White House to implement DMARC, a security protocol that prevents someone from successfully sending an email using someone else’s email address. It’s only fair to turn that lens on our own industry.
Via LLRX – Tax Fraud By The Numbers: The Trump Timeline – Former CPA, writer and teacher Ken Boyd provides readers with an explanation of tax fraud that is clearly presented, instructive and relevant to the ongoing Mueller investigation. Boyd uses the extensive New York Times investigative report of November 2018 that documented a history of tax fraud allegedly committed by Donald Trump, his father and siblings, as the foundation for his lesson on various types of tax fraud. The allegations documented by the Times are under review by the New York State Department of Taxation and Finance.
