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Monthly Archives: June 2015

Things I don’t like in the West: fiscal paradises as legalized crime

I live in the Western Europe, more exactly – in Spain. With all the problems we have, the life of the people here is much better than in the most parts of the world (Asia, Africa, Latin America). Almost every day I say thanks heavens I don’t live in such parts of the world.

Having said that, I don’t think that the West is perfect or very good. There are lots of bad things and I’ll try to mention some of them.

Today, the tax evasion: If a private person or the owner a small company evades paying tax, they are breaking the law and they risk to go to jail. But when big companies evade paying taxes using tax heavens, they are not breaking the law and they don’t risk anything. Because the laws are tailored in order to protect the big crime, legalizing tax fraud for the super-rich.

See also:

https://en.wikipedia.org/wiki/Tax_haven

The missing $20 trillion – How to stop companies and people dodging tax, in Delaware as well as Grand Cayman, Feb 16th 2013, The Economist.

Delaware – a black hole in the heart of America – The US state has been named the world’s most opaque jurisdiction in a major new survey of financial secrecy. 1 November 2009, Nick Mathiason, The Guardian

Legalized Tax Fraud: How Top US Corporations Continue to Profit Through Offshore Tax Havens, Feb 18 2015, budget.senate.gov
Senator Bernie Sanders (I-Vt.), the ranking member of the Senate Budget Committee, today called on America’s leading corporations to stop sheltering profits in the Cayman Islands and other offshore tax havens.

As CEOs seek tax cuts, senator slams corporate tax haven use, Feb 18, 2015, David Lawder, Reuters.
Sanders, top opposition member on the U.S. Senate Budget Committee, released a report decrying what he called “legalized tax fraud.” It showed that 111 of the 201 member companies of the Business Roundtable are sheltering more than $1 trillion in profits overseas, where they are not subject to U.S. taxes.

Capitalism: competition and affordable prices

Introduction: no economic system can work without affordable prices. Without affordable prices, the people become poor and incapable to buy the basic goods they need to sustain their life as human beings.

One of the most important things in a functional capitalist system is a real competitive market. The economic agents must compete in order to be able to offer competitive prices for their products. The competition and the competitive prices make the goods affordable, so the people can actually buy them.

Without competition, monopolies and cartels can form, and they can inflate the prices of the goods. And when the prices of the basic goods are inflated, then the people become poor, because they won’t afford to buy those basic goods (food, water, electricity, housing, etc)

Therefore the government must make sure that there is real competition on the market, in order to have affordable prices for the basic goods.

The government must fight monopolies, cartels and speculation because these things are anti-competitive and the inflate prices of basic goods.

In the area of housing and real estate, because the land is in limited supply, the price of the land and of houses tend to grow constantly. A limited amount of land can only fit a limited number of houses, so the houses can not be produced indefinitely like for example food.

In the field of real estate, competition is not enough in order to ensure the affordable prices. The only real solution here is the government to interfere and to rent houses and land to the people, for a profit, but at a decent price. Nobody should be able to rent two houses from the government. If someone wants more houses, they can buy or rent them from the private market. But they should not get from the government more than one house, because such thing will prevent someone else to have a house.

In conclusion, the competition is very important in order to make a system functional. But the real goal is not the competition in itself. The real goal is to get to the affordable prices. And sometimes the competition alone is not enough. The government should rent houses (or — better — apartments) to the people who want such houses, in order to make sure that the people can have access to affordable housing.

See also:

https://en.wikipedia.org/wiki/Price_fixing_cases

A few words about communism: participation

I do not agree that a functional communist society can be created with absence of money and state. On the other hand, I do support the ideas of egalitarianism and participatory democracy.
A communist system means the absence of state, and that means the system is sustained by participatory democracy, and that means the people in that system have to participate into the decision making. And this is the biggest problem with every single modern communist system or group of people: the sad truth is that the people do not bother to create a better society, they do not participate.

When a group of people want to have a communist system, they have to understand that they have to actually build their communist system, step by step, and they have to learn how to participate, because the ability to make the system work can come only from actually practicing it.

If the communists really want to build communism, they should start with the very basics: they can put money and effort together and they can start cooperatives, in order to start creating jobs and to practice. If one million communists will put 10 dollars each, they can get 10 million dollars, and with those money they can start a cooperative. That cooperative should work for a profit, and all the profits should be invested into growing the cooperative, to create even more jobs. Once they will make the system run, there will be a lot of enthusiasts available to donate much more than just 10 dollars. There are a lot of rich communist supporters in this world. So the money are not a problem. The real problem is to convince the people to actually participate.

If the communist supporters refuse to build their egalitarian society, then the only alternative left is for them to find leaders to build that egalitarian system for them. And there are very small chances that they can find the right people to do the job. Most likely, they will find a dictator like Stalin, Pol Pot, Ceausescu or Castro to enslave and terrorize them in the name of communism. All those dictators were free to do horrible things because the people prefer to find leaders who tell them sweet words instead of actually building communism.

So the problem is not the communism, but the real problem is the communists who refuse to participate and to actually build a better society.

A few words about communism: “communist” countries

One very important thing about the self-styled “communist” countries (examples: Soviet Russia, Poland, Hungary, Bulgaria, Romania, Albania, North Korea, China) that we have to notice is the fact that they were not and they are not communist at all.
In those countries, the “communist” leadership simply enslaved the people in the name of communism. Instead of working for greedy and corrupt rich investors, in the communist countries the people had to work for a greedy and corrupt communist elite. So there was no real change when those countries became “communist”.

Also there were no cooperatives in communist countries. What the governments called “cooperatives” were in fact state-owned companies where the people were forced to work for little money. The people did not own any land or means of production and they had no freedom to associate in order to create cooperatives. They were just forced to work together in government-owned outfits.

So, instead of giving the power to the working class, the “communist” governments simply enslaved the working class.
Also, they installed totalitarian regimes, and the people could not say anything against the communist party, and they could not even complain about the corruption of the “communist” leadership.

Therefore, we can safely say that the Western capitalist countries are much more communist than the “communist” countries, because in the West people are actually free to create cooperatives where each one has a share, while in the “communist” countries, they do not have that option.

So the people were just being indoctrinated (both in the West and in the East) to believe that those countries were communist, just like we (the Westerners) are indoctrinated today to believe that we live in capitalist systems, when in fact our systems are not capitalist, they are just being labeled as capitalist.