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Saturday, February 23, 2013

It is time for the US to adopt a Financial Transactions Tax (A Tax that May Change the Trading Game, Business Day, February 22, 2013: B1, B6).

The financial sector is, after all, where the money is.

I think that this tax should be a replacement for Corporate Income Taxes which can be avoided by careful transfer pricing games.

Sent to New York Times

Wednesday, February 20, 2013

Keystone Pipeline

Friends don't let friends binge.

That should be the watchword for President Obama as he considers whether or not to authorize the Keystone Pipeline (Obama Faces Risks in Pipeline Decision. New York Times, February 17th., 2013: B1-B2).

We should not binge on the Tar Sands oil. Actually we won't as all the refined product will be exported. But we also should not help our Canadian friends binge on dirty oil either.

The President should not issue permits. Let the filthy oil stay in the ground.

Sent to New York Times

Tuesday, February 19, 2013

Cardinal Mahoney

Cardinal Mahoney should not be going to Rome to help select a new Pope (Cardinal to be deposed in abuse suit. Boston Globe, February 16, 2013: A2).

The Cardinal has a clear conflict of interest. He has failed his flock. He might well be induced to vote for a Papal candidate who promises not to discipline him.

Sent to Boston Globe

Monday, February 18, 2013

Targeted Assassination

Mr Sununu is right to draw our attention to the O07bama "license to kill" (Boston Globe, February 17, 2013: A11).

Targeted assassination should not be one of our weapons in the War on Terror. We are fighting this war in defense of our values. When we descend to the tactics of the terrorists, we are ceding to them the victory.

We must find alternative procedures to defend ourselves that are consistent with the rule of law.

One of the enduring disappointments with the Obama Administration has been its failure to reverse the indefensible habits of the previous Administration.

Monday, February 11, 2013

A Rating Agency Fix

I fail to see how "open[ing] up the duopolistic world of rating agencies to greater competion" would result in "better performance" unless the business model is also changed (On the Waiting List at the Debt Rating Club. Sunday Business, February 10, 2013: B1, B7).

If the issuers still employ and pay the rating agencies, more competition will result in a drive to the bottom, with raters giving high ratings to worse and worse debt issues. The problem is that an investor cannot detect a low quality AAA rating until after the issuer has defaulted.

In my view, there are only two solutions. Either, have the raters paid by the purchasers of the debt, perhaps through a tiny Tobin-type tax, or nationalize the rating agencies and have a government agency carry out the ratings. I would favor the prior approach as competition would encourage accuracy in the ratings.

Sent to New York Times

Friday, February 8, 2013

Tax Expenditures

Mr. Jacoby is absolutely correct (A guaranteed flop for Massachusetts. Boston Globe, February 6th. 2013).

Giving tax breaks to big business (like Theatrical Producers, Movie Makers, Insurance Companies, etc.) to encourage them to locate in a given area is a beggar-thy-neighbor proposition. Often, as in New London, CT, the jobs never materialize, or they last only a short time as in Devens, MA and Providence, RI.

Some years back, the legislature passed an inter-state compact (National Popular Vote) to bypass the Electoral College to ensure that the President is elected by all the people. We urgently need an inter-state, inter-city, inter-town compact that will disallow these ridiculous handouts to the wealthy top managers of corporations seeking tax breaks.

Where do you think that $4m or $10m or $20m tax rebate will go: right into the pockets of the CEO and top management through their profit related bonuses.

It is past time to say "No" to the corporate welfare bums (Quote from former Canadian New Democratic Party leader, David Lewis).

Sent to Boston Globe