Tuesday, July 04, 2017

Amerikan Independence Day: Civil Wats Can Create a Tax Space for Social Enterprise

On American Independent Day Missile tested: Australia has condemned North Korea's latest reported launch of a long-range intercontinental ballistic missile. State-run television claims the rocket, which flew for almost 40 minutes before landing in the Sea of Japan, was ordered and ...

North Korea says it has successfully tested an intercontinental ballistic missile

The political economy of American independence - a new revision of a paper by Sebastian Galiani and Gustavo Torrens:
Why did the most prosperous colonies in the British Empire mount a rebellion? Even more puzzling, why didn’t the British agree to have American representation in Parliament and quickly settle the dispute peacefully? At first glance, it would appear that a deal could have been reached to share the costs of the global public goods provided by the Empire in exchange for political power and representation for the colonies. (At least, this was the view of men of the time such as Lord Chapman, Thomas Pownall and Adam Smith). We argue, however, that the incumbent government in Great Britain, controlled by the landed gentry, feared that allowing Americans to be represented in Parliament would undermine the position of the dominant coalition, strengthen the incipient democratic movement, and intensify social pressures for the reform of a political system based on land ownership. Since American elites could not credibly commit to refuse to form a coalition with the British opposition, the only realistic options were to maintain the original colonial status or fight a full-scale war of independence.
Happy Fourth of July!

Statement by Michael West to the the Senate Economics Reference Committee inquiry into Corporate Tax Avoidance Sydney on Independence Day Michael West

Frederick Douglass ended his Independence Day jeremiad in Rochester with steadfast optimism (“I do not despair of this country”). Read his closing lines, and what despair you might feel when listening to a President who abets ignorance, isolation, and cynicism is eased, at least somewhat. The “mental darkness” of earlier times is done, Douglass reminded his audience. “Intelligence is penetrating the darkest corners of the globe.” There is yet hope for the “great principles” of the Declaration of Independence and “the genius of American Institutions.” There was reason for optimism then, as there is now. Donald Trump is not forever. Sometimes it just seems that way. ♦

Chatham House, June 2017. The data reveal a continent split along three lines. First, there is a divide between elites and the public. There is alignment between the two groups in their attitudes to, among other things, EU solidarity, EU democracy and a sense of European identity. However, the data also show an important divide in general attitudes, beliefs and life experiences. Second, within the public, there is a pronounced divide between more liberal and authoritarian minded

groups, particularly on issues of identity. This divide plays a much stronger role than

other measures, such as economic status or experience of social hardship, in shaping attitudes towards the EU. The political challenges resulting from this divide are likely to persist for many years, even after economic growth is restored and sustained.

R&D rorting

Mihir A. Desai  (Harvard), The Wisdom of Finance: Discovering Humanity in the World of Risk and Return (2017): This book is not about the latest study that will help you make money in the stock market or that will nudge you into saving more

Lloyd Hitoshi Mayer (Notre Dame), Creating a Tax Space for Social Enterprise, in The Cambridge Handbook of Social Enterprise Law (Cambridge University Press 2017) (J. Yockey & B. Means eds.):
While still relatively few in number compared to traditional nonprofit and for-profit organizations, the rise of social enterprises represents a possible disruption of not only existing models of doing business but also areas of law that in many respects have seen little fundamental change for decades. One such area is domestic tax law, where social enterprises currently find themselves subject to the rules of for-profit activities and entities. Here, both scholars and policymakers are beginning to ask whether it is either necessary or desirable to modify existing tax provisions to better accommodate social enterprise: that is, whether to create a distinct tax space for social enterprise.

Alex Raskolnikov (Columbia), Probabilistic Compliance, 34 Yale J. Reg. 491 (2017):

Uncertain legal standards are pervasive but understudied. The key theoretical result showing an ambiguous relationship between legal uncertainty and optimal deterrence remains largely undeveloped, and no alternative conceptual approaches to the economic analysis of legal uncertainty have emerged. This Article offers such an alternative by shifting from the well-established and familiar optimal deterrence theory to the new and unfamiliar probabilistic compliance framework. This shift brings the analysis closer to the world of legal practice and yields new theoretical insights. Most importantly, lower uncertainty tends to lead to more compliant positions and greater private gains. In contrast, the market for legal advice tends to reduce compliance over time — a trend that a regulator may counter either by clarifying the law or by reiterating the law’s continuing ambiguity. If detection is uncertain, the probabilistic compliance framework reveals why, contrary to the prevailing view, the standard damages multiplier should be used to counter detection uncertainty but not legal uncertainty.

Story image for michael crocker ato tax chartered from The Sydney Morning HeraldATO takes 'unnecessary', 'belligerent' stance on small business ...