Let me start out with the conclusion – the government does not have a right to have easy access to your possessions on the premise that at some point in the future you might turn out to be a criminal.
There’s a lot of hoopla going on about child molesting pedophiliac serial murdering terorists(non islamic of course) who are just waiting for the release of the newer Apple IPhones so they can encrypt and hide the evidence of their crimes. This reckless disregard for government’s need to easily poke through your posessions, i.e. read the stuff on your IPhone, will allow these yet to be criminals to get off scott free because the government will be unable to easily decrypt the data.
Well, that at least seems to be the argument I keep hearing. I probably could have thrown in some other things these criminals are going to encrypt, but pedophiles and terrorists seem to be the hot button crimes the government thinks are the be all end all arguments for why they should be able to get at the data without a great deal of hassel on their part.
As a counter weight to that set of players, let’s imagine a journalist, with secret “Deep-Throat” level informers inside government who has data encrypted on his phone that pertains to government malfeasence with names, and dates, including the name or names of the informers (and copies of 8×10 color glossy photos with circles and arrows and a parapgraph on the back explaining what each one is to be used as evidence against them). And for crazy but obvious reasons the reporter really doesn’t want to share that with the government and he encrypts it on his IPhone.
Let’s presume for a moment a corrupt Department of Justice or other government agency. Crazy talk, right? Gee, that could never happen (cough cough…. DOJ FIFA foot dragging, contempt of Congress Fast and Furious, IRS investigations, lost emails, crashing hard drives, NSA reading everything written by everybody that traverses the internet) Let’s presume that the encrypted data that would bring down the government perps in these corrupt agencies is on the reporter’s IPhone, and the corrupt agency creates reason to confiscate said phone, and would like to know what’s on it, again, for crazy but obvious reasons. Suppose the criminals ARE the government. Nah, that could never happen.
So, do you believe you’re obligated to make your possessions easy for the government to search? Do you believe your house should be an open book to government warrant, because, hey, you might be a criminal in the future. People don’t think of their data as a posession, but just because the old way of storing data was ‘papers’ doesn’t mean that ‘bits’ aren’t really the same thing. All we did was change how it’s stored. Should you be obligated to tell the government about any and every secret hiding place you have on your property when they show up looking for those Cuban cigars you knew were illegal to bring back from your Carribean cruise? Should you be obligated to make it EASY for them?
It has been correctly pointed out that this action by Apple is in direct response to the NSA snooping, and we joke about it, but be honest, we all pretty much think they’re looking at EVERYTHING, don’t we? And despite their protestations of innocence, we think they’re doing it here, and abroad, for practically everyone, on any electronic transmission they can get access to. It all has to go through routers somewhere, sometime, it’s all being recorded and relayed at some point. All of it. This ain’t magic ya know. And now they’re outraged! outraged! that people might be trying to make it hard on them to peek and poke and prod.
And I’m supposed to believe being able to crack the data on an IPhone is going to stop, oh, another Boston Marathon bombing? When they lost track of a guy because they didn’t spell his name right? How are they going to get his phone to decrypt his data?
Nah, sorry, there’s a whole lot of government house cleaning that needs to go on at the IRS, the DOJ, and the many flavors of DHS before I get excercised about them not being able to easily decrypt data on an IPhone. I’m more afraid of the listed agencies than I am of Achmed and Mohammed or the guy who dresses up as Barney and keeps encrypted pictures of nude kids on his phone. I’m against all of those things okay? And my way of dealing with such people would probably be much more at home on the frontier west of the 1800’s than 21st century America.
But we have people flowing across our southern border from who knows where, thinking who knows what, carrying who knows what diseases or posessions and agencies getting bent out of shape over not being able to decrypt future criminal eveidence are doing exactly jack-all to stop THAT even though they know it’s occurring RIGHT NOW. Keep Achmed and Mohammed out of the country, and we won’t have to worry what they’ve encrypted on their IPhones. And we caught pedo’s before they had IPhones to encrypt data on.
Federal law enforcment can spare me their attempts at moral outrage because from what I see they’re not outraged much by the abuses they can do something about directly right now that have nothing to do with easily decrypting future data on a future criminal’s phone. And I am flat not convinced that the 4th Amendment was written to make it easier for the government to poke through my stuff.
Good riddance to the worst Attorney General in living history. In fact, I came to consider his department the “Department of Just Us” in which “justice” was a political tool to be wielded selectively and only when it helped those constituencies that comprised the “us”. And, of course, that included selective enforcement of the laws. Or said another way “rule of man” vs. “rule of law”.
The scandals such as Fast and Furious, were simply something to be expected from such a department. How could it be otherwise? They weren’t of the law, they considered themselves above the law. I have nothing nice to say about Eric Holder except I’m glad this day has finally come.
The Justice Department has been horribly harmed by that man’s tenure at the helm. Like America’s reputation in the world under Barack Obama, DOJ has a long climb back to respectability.
Meanwhile the “us” faction has immediately gone into action:
The Rev. Al Sharpton said his civil rights organization, the National Action Network, is “engaged in immediate conversations” with the White House as they work to name a successor to Attorney General Eric Holder, who is set to announce his resignation Thursday afternoon.
“We are engaged in immediate conversations with the White House on deliberations over a successor whom we hope will continue in the general direction of Attorney General Holder,” Sharpton said in a statement.
In reference to “climate change”, Paul Krugman leads with:
This just in: Saving the planet would be cheap; it might even be free. But will anyone believe the good news?
Two points – it is entirely debatable as to whether the planet needs saving. Science and the data produced certainly doesn’t support the supposition. I’m talking about real science. Not the pseudo-science of the alarmist side – the science denier side. Given that, why should anyone care about whatever “good news” Krugman is shilling today.
Second point – is government involved in the solution (he studiously tries to disguise that in his article)? Of course it is. Then it will be neither cheap nor free. And most likely it will be terrible to boot, hurt the economy, make government larger and more intrusive, etc., etc., etc.
So no, Mr. Krugman, anyone with two brain cells to rub together – and that likely excludes you – won’t believe much of anything that comes out of the pseudo-science, and now pseudo-economics of the left.
Large quote from Andy McCarthy. This is an important point that so many in the West simply refuse to acknowledge:
This point has been made so many times it should hardly be necessary to point out that Obama and Kerry, like Kerry’s predecessor Hillary Clinton, and like many Bush-administration officials before them (including President Bush), are dead wrong when they deny the nexus between Islamic doctrine –– the literal scriptures –- and terrorism, decapitations, totalitarian government, repression of women, rabid anti-Semitism, the murder of homosexuals, and so on. Still, it would be a serious error merely to observe that they are wrong, snicker at their fecklessness, and move on.
There is a reason they are taking a position diametrically opposed to reality.
Obama and Kerry, like transnational progressives in both of our major political parties, believe there are “moderate Islamists” who are the key to stability in the Middle East. Now, the term “moderate Islamist” is contradictory: an Islamist wants government by sharia, Islam’s totalitarian societal framework and legal code. There is nothing moderate about sharia. Those who want it implemented are not “moderates” even if they don’t commit mass-murder to get their way. Sharia is also anti-liberty, anti-equality, and anti-Western. Therefore, we should oppose Islamism just as we oppose other freedom-killing ideologies. That doesn’t mean we need to go to war with all Islamists, but we should work to diminish their influence and we should never regard them as a solution to anything.
Notwithstanding their abhorrence of the West, “moderate Islamists” are regarded by Obama and Kerry as potential allies: people, groups, and, in the case of Turkey, for example, countries that we can work with to solve the problems plaguing the Middle East and overcome our own security challenges. It is thus critically important to Obama and Kerry for the public to believe that (a) all Islamists are not basically the same and (b) there is a sharp difference — a day-and-night difference — between “moderate Islamists” and terrorist organizations like the Islamic State and al-Qaeda. If, instead, the public becomes convinced that all Islamists, violent or non-violent, adhere to essentially the same ideology, the administration’s goal of working with Islamic supremacists becomes politically untenable.
It is impossible to convince people that non-violent (or, at least, purportedly non-violent) Islamists are not representative of Islam. The administration tried that with its “largely secular” Muslim Brotherhood flyer . . . and has been embarrassed ever since by the howls of laughter. Most significant Islamist groups are rooted in or affiliated with the Brotherhood. Not only do these groups claim the mantle of Islam’s representative; our government concedes that status to them.
Because they refuse to acknowledge this they simply hold out a “solution” that doesn’t exist. So-called “moderate Islam” is only a ratcheted down version of the extremists. Perhaps “moderate Islam” doesn’t want to take part in killing you, but they’re not particularly upset that the extremist version is doing it for them. They may differ in the methods, but they’re not indifferent to the result – i.e. the world converting to Islam and the establishment of Sharia law. That is the ultimate goal of Islam. Weasel wording it doesn’t change that fact.
So how does one go about convincing “moderate Islam” to back off? Well one way to to recognize the threat, and the threat isn’t just limited to “extremists”. However, such recognition is antithetical to the tenets of the left’s multi-culturalism. Every culture is “worthwhile” and has “value”. Even those which justify the murder of non-believers and homosexuals, enslave and mutilate women, and essentially redefine misogyny. The very people who support this sort of “tolerance” would likely be its first victims.
Back to the question – how do we back off “moderate Islam?” Well this is going to sound exceedingly violent, but it is meant to be. You have to ruthlessly and completely wipe out the extremists. But instead, we seem to be contemplating a strategy of “managing” the threat. As Michael Totten notes:
The reason we must reject the tempting tendency to close our eyes and hope this problem goes away is that Allah doesn’t always sort things out according to American interests.
Life is filled with things we don’t want to do but have to do anyway. No one wants radiation or chemotherapy, but if you get cancer, you’re going to have to take it despite the fact that it might not work and that it will certainly feel like it’s killing you.
Let’s not kid ourselves. ISIS — or ISIL as the President calls it — is cancerous. And it is not a benign tumor. It is metastasizing and will not stop growing stronger and deadlier until it is dealt with aggressively and, at the absolute minimum, contained.
And only that sort of treatment will impress “moderate Islam” – period. Of course, that’s only step 1. Step 2 will be even more painful for the Western left. It is all about intolerance. That’s right, it’s about being intolerant of ideas, principles and cultural norms that attack and would eventually destroy Western culture as we know it. Islam is as intolerant of our Western culture is we should be of it’s culture. Just because some group of elitists on the left decided one day that all cultures are equal and valuable has now been shown to be simplistic pap. And unless Western civ is in the mood to commit suicide, it is going to have to make some very hard and intolerant decisions in the near future.
So if the West is to survive, it’s time to take a real “step 1″, not some half-measure that I am pretty sure is being contemplated as we speak.
Many violent jihadists who go on to join al-Qaeda and, now, the Islamic State (an offshoot of al-Qaeda) got their start in the Muslim Brotherhood. They seamlessly graduate from Brotherhood teaching to insatiable jihad because Brotherhood teaching lauds jihad. In fact, the transition happens because many of those who receive Brotherhood instruction become frustrated by the contradiction between the Brotherhood’s aim of a worldwide caliphate and endorsement of jihad to achieve it, on the one hand, and its counsel of patience in pursuing it, on the other.
It is precisely because Islamists share an ideology rooted in Islam, and what they see as a divinely mandated mission of conquest, that a Muslim can so predictably evolve from student to sharia adherent to “moderate Islamist” to not-so-moderate Islamist to terrorist. It happens frequently. And the common ideology rooted in Islam also explains why so many “moderate Islamists” financially and morally support violent jihadist organizations even if they don’t take up arms themselves.
Why? Because, as I said, the “moderates” are not at all indifferent to the outcome brought about by the extremists. And until we wrap our heads around that and do what is necessary to actually and finally address the real threat we face, it’s not going to get any better and could easily get much worse. It isn’t about extremists and moderates, it’s about a toxic culture/religion that was recognized as such by the West centuries ago as a threat. As for the present, there’s very little difference between “moderate” and “extremists” with regard to the final outcome they seek:
The Islamic State has presumed to declare a caliphate. Al-Qaeda franchises think that is hasty — especially since someone else is running the caliphate — and would proceed more gradually, setting up emirates and hoping for more consensus among Islamists. Both organizations want to confront the West only violently; the Muslim Brotherhood, on the contrary, teaches that, while violent jihad has its place (see Hamas), it is valid to negotiate with the West, to infiltrate the West’s institutions, and to achieve whatever conquest can be achieved without violence.
The VA system has given us a hint of what we can expect from a government run health care system in the US. But the UK has been doing it since 1948. And, it appears, most of those who want a single payer, government system purposely turn a blind eye to the UK’s experience:
Death rates in NHS hospitals are among the highest in the western world, shock figures revealed yesterday.
British patients were found to be almost 50 per cent more likely to die from poor care than those in America.
They have five times the chance of dying from pneumonia and twice the chance of being killed by blood poisoning.
Experts say that, despite recent improvements, NHS death rates still outstrip those in many other European countries.
Note the second sentence. That’s as of today. To date, our government hasn’t the level of intrusion or time to turn the health care system in the US into an NHS.
If you think its bad now, just imagine the entire country run like the VA. Or NHS.
President Barack Obama will attend a United Nations summit on climate change in September.U.N. Secretary-General Ban Ki-moon has invited heads of state and other leaders to the Sept. 23 summit in New York. The U.N. says the goal is to spur governments, industry and civil groups to make new commitments to addressing climate change.The summit comes one year before world leaders will gather in Paris for global climate talks aimed at securing a deal to reduce greenhouse gas emissions. Obama has set a goal to cut U.S. emissions 17 percent by 2020, compared to 2005 levels.
The Obama administration will seek a non-binding international accord – rather than a treaty – at a United Nations climate summit in Paris next year on reducing the greenhouse gas emissions that contribute to global warming, The New York Times reported Wednesday.
It was a widely anticipated move, as President Barack Obama has repeatedly said he would act alone, bypassing Congress, if lawmakers declined to support his proposal.
So one would assume that the UN meeting would lay the groundwork for the Paris talks, no? Since it all under the auspices of the UN? And this apparently is very important to our president, no? He’s going to attend, he’s got a plan (one of the few plans his administration has ever managed to push out there) to make a commitment for the US while bypassing Congress. What could go wrong with this issue that is so important to Obama? And he’s certainly consulted with other world leaders to ensure their cooperation and backing, right?
Indian Prime Minister Narendra Modi, leader of the world’s third-largest greenhouse gas-emitting nation, won’t join his U.S. and Chinese counterparts at a United Nations climate summit next month in New York. Modi’s absence is a bit of a blow to the summit.
Chinese counterparts? The Chinese are blowing it off too:
Chinese president Xi Jinping has decided to skip a meeting of world leaders on climate change in New York, according to climate insiders, casting doubt on the summit’s potential to make progress ahead of next year’s major UN climate summit in Paris.
You think? But, as the commercial says, “that’s not all”:
German daily TAZ reports that German Chancellor Angela Merkel isn’t going to bother attending the Ban Ki-Moon initiated climate conference in New York this coming September. The TAZ adds this has been “confirmed by a government spokesman“. Merkel’s decision to snub the event is likely another sign that efforts to forge a climate agreement are already dead in water. The TAZ writes: “Ultimately only Europe and very few other countries remain on board. Canada for example has opted out. Japan and Russia are also no longer taking part.”
Always the last to know. Kind of like his foreign policy, isn’t it? No India. No China. No Russia. No Canada, Germany or Japan.
So, if all of these major players in the world don’t see a reason to show up for Obama and Moon’s little show, how are those two going to sell this to world as an emergency situation that needs drastic action?
I know — call in John Kerry!
And the clown car continues to careen down the path to nowhere.
And I’m not talking about Putin’s attempt to resurrect it – I’m instead talking about this horrific overreaction by state of Maryland to … a book set in the future:
A 23-year-old teacher at a Cambridge, Md. middle school has been placed on leave and—in the words of a local news report—”taken in for an emergency medical evaluation” for publishing, under a pseudonym, a novel about a school shooting. The novelist, Patrick McLaw, an eighth-grade language-arts teacher at the Mace’s Lane Middle School, was placed on leave by the Dorchester County Board of Education, and is being investigated by the Dorchester County Sheriff’s Office, according to news reports from Maryland’s Eastern Shore. The novel, by the way, is set 900 years in the future. . . .
Imagine that—a novelist who didn’t store bombs and guns at the school at which he taught. How improbable! Especially considering that he uses an “alias,” which is apparently the law-enforcement term for “nom de plume.” (Here is the Amazon page for The Insurrectionist, by the way. Please note that the book was published in 2011, before McLaw was hired.)
According to an equally credulous and breathless report in the Star-Democrat, which is published in Easton, Md., the combined efforts of multiple law-enforcement agencies have made area children safe from fiction. Sheriff Phillips told the newspaper that, in addition to a K-9 sweep of the school (!), investigators also raided McLaw’s home. “The residence of the teacher in Wicomico County was searched by personnel,” Phillips said, with no weapons found. “A further check of Maryland State Police databases also proved to be negative as to any weapons registered to him. McLaw was suspended by the Dorchester County Board of Education pending an investigation and is no longer in the area. He is currently at a location known to law enforcement and does not currently have the ability to travel anywhere.”
As I find and read more stories like this on a much more frequent basis, I have to wonder what happened to America. Where did it go? And when?
The fact that anyone would find this supportable is phenomenal in and of itself, yet here we have the report … McLaw was obviously taken as a credible threat because he wrote … fiction to sell books.
Jeffery Goldberg goes on:
It is somewhat amazing that local news reports on this case don’t make clear whether McLaw is under arrest, and if so, on what charge. It is equally astonishing that the reporters on this story don’t seem to have used the words “First Amendment” in their questioning of law-enforcement officials, and also astonishing they don’t question the Soviet-sounding practice of ordering an apparently sane person who has been deemed unacceptable by state authorities to undergo a psychological evaluation.
It would be useful to know if McLaw is under investigation for behavior other than writing two novels—and perhaps he will be shown to be a miscreant of some sort—but so far, there is no indication that he is guilty of anything other than having an imagination, although on Maryland’s Eastern Shore, as news reports make clear, his imagination is considered an active threat.
Dorchester County Superintendent of Schools Dr. Henry Wagner told WBO that police will be present at the middle school “for as long as we deem it necessary,” and the sheriff said that law-enforcement officials across the Delmarva peninsula have been given McLaw’s photo in case he shows up in their jurisdictions—though again, it is not clear if he is, in fact, in police custody at the moment.
This is what happens when people quit thinking and only do “their duty”. When rules like “zero tolerance” replace common sense.
What happened to McLaw is an outrage. It is unacceptable. It should be condemned in the very strongest of terms.
Yet, at least by the media there, it seems all perfectly sane and normal. And, apparently, the police force as well. School. Etc.
Maryland (and Cambridge in particular) should be utterly ashamed.
How many times have we been treated to hissy fits by the environmental left when it comes to species other than humans and their endangerment? What group has constantly pushed for laws that protect animals from humans? And where have the enviros been mostly silent as a particular group of animals is wantonly slaughtered daily in the name of green, renewable energy?
California’s massive Ivanpah solar power plant can produce enough electricity for 140,000 households — but the environmental cost is nothing less than an avian slaughter.
The plant’s 350,000 mirrors bounce sizzling sunlight to the tops of three 40-story boiler towers, heating steam for turbine electricity generators. Temperatures near the towers can reach up to 1,000 degrees Fahrenheit, heat certainly sufficient to fry a fowl.
“Workers at the state-of-the-art solar plant in the Mojave Desert have a name for birds that fly through the plant’s concentrated sun rays — ‘streamers,’ for the smoke plume that comes from birds that ignite in midair,” the Associated Press reports this week.
That’s a common occurrence, the AP continues; federal investigators saw a bird burn roughly every two minutes. Ivanpah owner BrightSource estimates that “about a thousand” die each year, and one environmental group says the plant kills up to 28,000 birds each year.
Of course, if you do the math (and account for 12 hours of darkness each day) it comes out to about 130,000 a year – assuming the observation that one bird “burns” every two minutes. And the outcry? Yeah, not so much.
And some of the birds it is killing are, among others, endangered:
As the plant prepared to begin operations, workers found the winged corpses of “a peregrine falcon, a grebe, two hawks, four nighthawks, and a variety of warblers and sparrows,” the Wall Street Journal reported earlier this year.
You want a “silent spring”? Keep building these sorts of installations.
What about wind turbines? Well, Ivanpah comes up a piker in comparison:
Ivanpah isn’t the only green darling with a lot of bird blood on its hands, either. The American Bird Conservancy estimates wind turbines slay 440,000 birds each year, and the an analyst writing in the Wildlife Society Bulletin says it’s closer to 573,000 — in addition to 888,000 bats.
And, as usual, our federal government makes exceptions to the law for favored industries:
Federal wildlife officials on Friday for the first time agreed not to prosecute a developer if an endangered California condor is struck and killed by turbine blades at its proposed wind farm in the Tehachapi Mountains, about 100 miles north of Los Angeles.
You accidentally do it and watch how much of an exception they make for you.
In the meantime, with all this data showing massive bird kills among solar and wind turbine installations?
Crickets – unless they find some other sort of “green energy” source that happens to wipe them out too.
Well, if reports are true it appears our self-crowned king has decided he’s found a way to obligate us to a treaty without following the Constitution’s proviso for doing so.
In seeking to go around Congress to push his international climate change agenda, Mr. Obama is echoing his domestic climate strategy. In June, he bypassed Congress and used his executive authority to order a far-reaching regulation forcing American coal-fired power plants to curb their carbon emissions….
American negotiators are instead homing in on a hybrid agreement — a proposal to blend legally binding conditions from an existing 1992 treaty with new voluntary pledges. The mix would create a deal that would update the treaty, and thus, negotiators say, not require a new vote of ratification.
Countries would be legally required to enact domestic climate change policies — but would voluntarily pledge to specific levels of emissions cuts and to channel money to poor countries to help them adapt to climate change. Countries might then be legally obligated to report their progress toward meeting those pledges at meetings held to identify those nations that did not meet their cuts.
“There’s some legal and political magic to this,” said Jake Schmidt, an expert in global climate negotiations with the Natural Resources Defense Council, an advocacy group. “They’re trying to move this as far as possible without having to reach the 67-vote threshold” in the Senate.
“Political magic”? Is that the state of our nation now – we resort to “political magic” when we can’t get our way as the Constitution requires? Well, yes.
President Obama seems to be following a script laid out in May, 2014 by former Undersecretary for Global Affairs Timothy Wirth, who was the Clinton Administration’s lead negotiator for the Kyoto Protocol, and former South Dakota Senator Thomas Daschle who astutely asserted that “the international community should stop chasing the chimera of a binding treaty to limit CO2 emissions.” They further noted that more than two decades of U.N. climate negotiations have failed because “nations could not agree on who is to blame, on how to allocate emissions, or on projections for the future.”
Wirth and Daschle are advocating that the climate negotiators adopt a system of “pledge and review” at the 2015 Paris conference of the parties to the UNFCCC. In such a scheme nations would make specific pledges to cut their carbon emissions, to adopt clean energy technologies, and to wring more GDP out of each ton of carbon emitted. The parties would review their progress toward reducing greenhouse gas emissions every three years and make further pledges as necessary to achieve the goal of keeping the increase in average global temperature under 2°C. Since there would be no legally binding targets, there would be no treaty that would require politically difficult ratification. If insufficient progress is being made by 2020 they argue that countries should consider adopting globally coordinated price on carbon.
Now this isn’t to say that this is going to work or even have an effect, but it is a blatant attempt to have one’s way (via “political magic”) while avoiding the unpleasantness of a failure to get a ratification by tw0-thirds of the Senate (its all about getting the leverage to pass a carbon tax).
And, as usual, Mr. Obama doesn’t care one whit about much more than getting his way – just ask Senate Democrats:
President Obama’s election-year plan to win a new international climate change accord is making vulnerable Democrats nervous.
The administration is in talks at the United Nations about a deal that would seek to reduce global greenhouse gas emissions by “naming and shaming” governments that fail to take significant action.
The State Department on Wednesday denied a report in The New York Times that the plan is to come up with a treaty that would not require Senate confirmation, but that appeared to provide cold comfort to Democrats worried the issue will revive GOP cries about an imperial Obama presidency.
One Democratic strategist said the proposal would put swing-state candidates who are critical to the party keeping its Senate majority “in front of the firing squad.”
“You’re … making it more difficult for them to win and certainty putting them in a position to lose,” the strategist said.
Silver linings … always look for the silver lining to those storm clouds.
And then there’s immigration …
I’ve never really been much of a Burger King fan, but guess what I’m having for lunch today?
Why? Because Burger King has given us an opportunity to point out one reason why our economy is lagging. And, as usual, it has to do with government policy. Politicians would like to play the blame game and point at corporations like Burger King moving to Canada (after a merger with Canadian based Tim Hortons) as the reason. Instead, it is the federal government’s oppressive and unprecedented corporate tax rate that is helping to keep our economy floundering by providing incentive for corporations to leave.
Megan McArdle writes a great column today. To begin with she cites a paragraph from Matt Levine that makes the point that most in the media and almost all politicians opposing the merger fail to make:
The purpose of an inversion has never been, and never could be, and never will be, “ooh, Canada has a 15 percent tax rate, and the U.S. has a 35 percent tax rate, so we can save 20 points of taxes on all our income by moving.” Instead the main purpose is always: “If we’re incorporated in the U.S., we’ll pay 35 percent taxes on our income in the U.S. and Canada and Mexico and Ireland and Bermuda and the Cayman Islands, but if we’re incorporated in Canada, we’ll pay 35 percent on our income in the U.S. but 15 percent in Canada and 30 percent in Mexico and 12.5 percent in Ireland and zero percent in Bermuda and zero percent in the Cayman Islands.”
Got it? The US government does something no other first world government does. McArdle explains:
The U.S., unlike most developed-world governments, insists on taxing the global income of its citizens and corporations that have U.S. headquarters. And because the U.S. has some of the highest tax rates in the world, especially on corporate income, this amounts to demanding that everyone who got their start here owes us taxes, forever, on anything they earn abroad.
This is a great deal for the U.S. government, which gets to collect income tax even though it’s not providing the companies sewers or roads or courts or no-knock raids on their abodes. On the other hand, it’s not a very good deal for said citizens and corporations, especially because our government has made increasingly obnoxious demands on foreign institutions to help them collect that tax. Both private citizens and corporations who have a lot of income abroad are deciding that they’d rather renounce their ties to the U.S. than deal with the expense and hassle of letting it tap into income that they have earned using some other country’s roads and sewers and police protection.
Practically speaking, global taxation is hard to enforce and loaded with bad incentives, which is why our fellow members of the Organization for Economic Cooperation and Development have moved away from global taxation of corporate income, and abandoned global taxation of personal income. If anything, the U.S. has gone in the other direction — by insisting, for instance, that foreign companies report various financial transactions with U.S. citizens to the Internal Revenue Service, and taxing foreign cost of living allowances, which makes it more expensive for companies to employ expats. On the corporate side, the Barack Obama administration has repeatedly suggested tightening up on tax deferral of foreign income and other credits, which would make it even more expensive to be a corporation based in the U.S.
So why base in the US with this being the case? Why wouldn’t any sane US based corporation be trying to find a remedy to this pernicious and oppressive tax code? In reality, this describes it rather well:
[I]t boils down to “the police kept people from sacking your first headquarters, so therefore you owe us 35 percent of everything you make, forever.” Loan sharks and protection rackets offer more reasonable terms than this.
Yes, they likely do. You know you have a problem when more and more of government begins to resemble criminal gangs. And that’s where we are headed. Instead of looking at a solution that will benefit a corporation and give them an incentive to remain and pay taxes, our government and the politicians seem bound and determined to make the corporation the bad guy with absurdly Orwellian insults like “economic patriotism” and “corporate deserters”. This, instead, should be the bottom line:
If we’re worried about inversion, then the U.S. government should follow the lead of other developed countries, and move to territorial taxation. Otherwise, we should stop complaining when people and corporations decide that they’d rather be a citizen of some more sane system somewhere else.