The IRS Rewards Corporations For Not Being American

Abu Daoud challenged me on the whole business of people and businesses fleeing the UK on account of rising taxation.  I answered that, but now on this side of the pond we have this:

Code Section 162(m) limits the deduction for compensation paid to certain highly paid employees of publicly held corporations to $1 million per year. A recent Private Letter Ruling addressed the application of this limitation to a foreign corporation whose American Depository Shares are publicly traded.

The Code Section 162(m) limitations only apply to corporations issuing a class of common equity shares required to be registered under section 12 of the Securities Exchange Act of 1934. In the Private Letter Ruling, the corporation paying the excess compensation was a foreign corporation that was qualified as a “foreign private issuer” under 17 CFR Section 240.3b-4(c) and as such was not required to be registered under section 12 of the Exchange Act…

Therefore, foreign corporations with limited U.S. shareholders or that appropriately limit certain U.S. connections have some confirmation from the IRS that they are outside the $1 million compensation limits.

If you see a rash of one-way plane tickets to the Cayman Islands, don’t be surprised.

Capital Flight: The UK Leads the Way

Being the darling of America’s elites will probably not be much of a warning to us about this:

The British budget last Wednesday did very little to rectify that country’s yawning fiscal deficit, but what little it did was almost entirely at the expense of the country’s high-income earners, those making over 150,000 pounds (US$210,000). The fascinating question is: if British governments return to their pre-1979 high-tax ways, as seems likely, what will happen to London’s financial services business?

Not content with raising the top marginal income tax rate to 45% from 40% last November, Chancellor of the Exchequer Alistair Darling raised it again to 50%. Two tax increases in one year will certainly start to convince affluent Brits that this has become a habit, as it was with previous Labor governments. Indeed, yawning future budget deficits, and the accompanying financing difficulties, are likely to lead to further such increases. Now the European Union wants to impose a Europe-wide statutory limit on bankers’ bonuses.

The Europeans (and this includes the Brits) are taking a cue from Rahm Emanuel and using this crisis to both revert to higher tax regimes and to eliminate tax shelters.  Their idea is that people will just sit around and allow their incomes to be taken away by the Taxman.

But this is not the case, as Martin Hutchinson points out:

Since the destruction of almost all the historic British financial institutions in 1986-2000, the picture is very different. A high proportion of the participants in the London market are foreigners, and even British participants are much more securely members of the international moneyed elite than of the decayed British aristocracy or impoverished middle class. The significant London financial institutions are almost all headquartered outside Britain, and their London staff have caused the head offices endless cost and risk over the last few years by their careless attitude to the parent institution’s risks and insatiable appetite for their own rewards.

Potential clients are themselves global, with corporations manufacturing worldwide and run by rootless MBA management, while the wealthy are almost entirely from non-UK cultures, possibly effectively without any domicile at all if their home country has been taken over by crooks, thugs or Marxists. In any international business, London is no longer without serious competition; for one thing, most owners of London financial houses have taken good care to install equivalent capabilities in their home country headquarters.

Although it will take more abuse to achieve this result in the U.S., it certainly can be done.  And will almost have to be, given the a) high tax rates necessary to service the enormous debt our government is running up and b) the anti-growth policies (such as cap and trade) which will make repayment of this debt even harder.  When this transpires, there will be much movement of the world’s financial system.

Islam vs. the Atheists: The New Competition

The juxtaposition of two posts deserves note.

First, this one from Abu Daoud about Our Islamic Future (it’s the YouTube video below):

The second comes from the New York Times (HT to Titusonenine):

More than ever, America’s atheists are linking up and speaking out — even here in South Carolina, home to Bob Jones University, blue laws and a legislature that last year unanimously approved a Christian license plate embossed with a cross, a stained glass window and the words “I Believe” (a move blocked by a judge and now headed for trial).

They are connecting on the Internet, holding meet-ups in bars, advertising on billboards and buses, volunteering at food pantries and picking up roadside trash, earning atheist groups recognition on adopt-a-highway signs.

They liken their strategy to that of the gay-rights movement, which lifted off when closeted members of a scorned minority decided to go public.

The analogy to the gay rights movement is fruitful, not only because they’re “coming out of the closet” but also because the LGBT community is more secular than people like V. Gene Robinson and Susan Russell want to admit.  So there’s a considerable overlap between the two.

Generally speaking, on both sides of the Atlantic the usual target of atheists has been Christianity.  But a more agressive–and demographically growing–group are the Muslims.  If and when Islam decides to focus on atheists–and that focus depends upon whether the atheists are stupid enough to target them legally, something they haven’t done much of yet–the resulting firestorm will not be nice.  And the atheists will wish they had stuck with making the Christians’ life miserable.

Will this happen?  If Allah wills it…

Forrest Mims, Creationist, Featured in True Maroon

The current edition of True Maroon, an online magazine for and about Aggies, features a piece (in video and text) on Forrest Mims III ’66, science writer and researcher. In November 2008, Discover magazine named him one of the “50 Best Brains in Science.

But all was not so rosy for Mims.  As the text portion explains:

In 1990, Mims was denied a writing spot as the editor of Scientific American’s “The Amateur Science” column after revealing his belief in creationism. The controversy and his claim of religious discrimination launched Mims into an international media storm. Reporters showed up on his doorstep, his phone rang constantly for interviews and television news set up cameras in the pasture.

When the hard questions came and the opposition got loud, he did what he still does. “I revert right back to being a freshman at Texas A&M with that sophomore yelling at me and screaming at me, telling me to do pushups,” he said. “So I can tolerate things that I might not have been able to tolerate otherwise.”

Texas A&M taught him that resistance makes you stronger—and what he thought was a roadblock in his career turned out to be an opportunity. In taking a break from writing, Mims focused on science.

I’m proud to be a fellow Aggie with Forrest Mims.

Book Review:J.I. Packer’s Affirming the Apostles’ Creed

J.I. Packer is one of the most eminent writers and theologians in the Anglican world.  His claim to fame was sealed by his being defrocked by Michael Ingham, the revisionist Bishop of New Westminster whose sanctioning of same-sex blessings predates the American’s ordination of V. Gene Robinson.   It’s one of those things that, if he never did anything else, it’s enough for one life.

But he has done many other things, and one of those is the little book Affirming the Apostles’ Creed.  It’s a step-by-step voyage through the Creed, a statement of faith that on the surface seems universal but in fact has suffered from some neglect, and not only from the revisionist part of the Anglican/Episcopal world, either.

To begin with, the Apostles’ Creed isn’t recited as much as one would think for such a basic statement of faith.  In the traditional Anglican prayer books, it was featured in Morning and Evening Prayer, with the longer and more detailed Nicene Creed (which was not, in reality, formulated at either Council of Nicea) taking pride of place in the Holy Communion, as it does in the Roman Catholic Novus Ordo Missae.  Although that division is not set in stone, making Holy Communion the “default” celebration in TEC didn’t do this Creed’s currency any benefit.

Beyond that is a more yawning chasm: most Evangelical churches don’t even include the Apostles’ Creed as part of their basic declaration of faith.  It’s not technically necessary for millions of Christians to know it, let alone believe it.

Packer–who is definitely from Anglicanism’s Evangelical wing–has furnished an interesting resource to remedy the latter problem.  Affirming the Apostles’ Creed begins with an overview of how the creed came into being, and from there addresses and illuminates each point of the Creed.  His approach is deliberately simple; he tries (with considerable success) to detail the background of the various parts of the Creed.  There’s a fine line between simplification and insulting the reader’s intelligence, and Packer does an admirable job in walking that line.  His exposition of the theology/doctrine behind each phrase actually clarifies what the Creed expresses.  Each chapter has at the end verse references for further Bible study and questions for thought and discussion, so the book is aimed not only for personal reading but group study, either for new converts (more about that later,) or even a confirmation class.

Let me make some observations about some points he makes that may be of more interest to those outside the Anglican world than inside.

First, many Evangelicals have been bothered by the phrase, “the Holy Catholic Church.”  While reviewing both sides of the issue, Packer gives the classic Protestant Anglican reply to this, namely that this phrase refers to “the one worldwide fellowship of believing people whose Head is Christ.”  This has been standard Anglican issue for a long time, although it’s not to the Anglo-Catholics’ taste.

Second, his attitude towards the Charismatic Renewal is, to say the least, ambivalent.  One the one hand, he tells us the following:

The only sure signs are that the Christ of the Bible is acknowledged, trusted, loved for his grace, and served for his glory and that believers actually turn form sin to the life of holiness that is Christ’s image in his people…These are the criteria by which we must judge, for instance, the modern “charismatic renewal” and Christian Science (reaching, perhaps, different verdicts in the two cases.)

On the other hand he has this statement which deserves wider currency:

The evangelical theology of revival, first spelled out in the seventeenth and eighteenth centuries, and the present-day emergence of “charismatic renewal” on a worldwide scale remind us of something that Roman Catholic and Protestant disputers, in their concentration on doctrinal truth, tended to miss–namely, that the church must always be open to the immediacy fo the Spirit’s Lordship and that disorderly vigor in a congregation is infinitely preferable to a correct and tidy deadness.

Third, at the start of the book he depreciates evangelistic approaches such as the “Roman Road” type (which is similar but not identical to this)  and presents the Apostles’ Creed as superior for this purpose.  That deserves a better treatment than he gives it.

It’s true that the “Roman Road” approach (and the more elaborate approach such as one sees in Evangelism Explosion) work best in a society where most people have a Christian background.  It’s worth noting, however, the only people who think that this method of presenting the Gospel to be the “end all” for the Christian are those who have a theology of conversion and perseverance of, say, the Southern Baptists.  That’s a distinction that Packer fails to make; he criticises the method without really exploring the theology underlying the idea.

Beyond that, it’s becoming evident that, in a non-Christian society–be it a secular one or dominated by another religion such as Islam–that follow-up and discipleship are as critical a part of the process as basic evangelism.  Packer admits as much by evoking the history of Roman Empire Christianity with its cathecumenate.  The discipleship process is integral to the evangelistic one, and it is here that the Apostles’ Creed, because of its simplicity and conciseness, is potentially a useful part of the process.

With all this and more, Affirming the Apostles’ Creed is an excellent introduction and elucidation of this, Christianity’s most foundation declaration of faith.

Barack Obama: Let the Show Trials Begin

This speaks for itself:

(You’ll need to get about 4 1/2 minutes into the video to get to that particular question and response.)

I’ve been predicting this kind of thing since before the election.  I’ve also observed that, as President, Barack Obama is caught in the middle on this.  As a liberal, putting these people on trial in effect moves forward the criminalisation of his political opponents, which is an ideal situation for him.  As chief executive,  he knows that such proceedings could be used against him and his officials if and only if the political winds reverse themselves.  To guarantee the latter won’t happen, he must make the former work completely, and that’s a big gamble, even in this current, one-sided political climate.

Note: make no mistake, proceedings such as this are very much “victor’s justice,” as has been the case since the end of World War II (see this piece on that subject.)

A Fistful of Yuan Takes a Step Closer to Reality for Everyone

In putting together my series on doing business in China in the early 1980’s, I adopted the title A Fistful of Yuan, turning a business tale into a spaghetti Western (or, more properly, an Eastern.)

Well, it looks like the Chinese are working up towards making the yuan a real hard currency, as this indicates:

The Chinese government’s decision this month to let exporters in a small number of cities settle their overseas trade in yuan rather than in US dollars has far-reaching implications, according to economists, even though the immediate impact is minimal.

The trading hubs of Shanghai at the mouth of the Yangtze River and Guangzhou, Shenzhen, Zhuhai and Dongguan in the Pearl River Delta further south can use the yuan in overseas trade settlement, a State Council, or cabinet, meeting chaired by Premier Wen Jiabao said. The two deltas are the base for most of China’s export-oriented industry.

The settlement scheme is voluntary and of benefit to relatively small groups, said Pauline Loong, senior vice president in charge of China policy and risk research at CIMB-GK Securities (HK) Ltd, but “the implication is far-reaching. The scheme extends the use of the Chinese currency outside of the mainland. We see this as the first step on the road to full liberalization of China’s capital account and full convertibility for the renminbi,” one term for the Chinese currency, also known as the yuan.

And so we, in the not too distant future, may need a “fistful of yuan” (or perhaps a few yuan more) to get along.

Civil Marriage: Let’s Take This to the Next Level, Gene

Bishop of New Hampshire V. Gene Robinson is at it again:

The first openly gay Episcopal bishop told a Los Angeles gathering yesterday that the church should begin mending divisions over the issue of same-sex marriage by getting out of the civil marriage business altogether.

During a visit to St. Michael and All Angels Church, the Rev. Gene Robinson said he favored the system used in France and other parts of Europe in which civil marriage – performed by government officials – is completely separate from religious vows. In the United States, the civil and religious ceremonies often are combined by the cleric signing the government marriage license.

“In this country, it has become very confusing about where the civil action begins and ends and where the religious action begins and ends, because we have asked clergy to be agents of the state,” said Robinson, bishop of New Hampshire.

I just dealt with this again last week, and my response was and is as follows:

The way out of this is to get ministers away from being agents of the state.  Recently a Hispanic colleague in the ministry “serenaded” his wife on Facebook for their 25th anniversary.  He’s from Uruguay.  They met at summer camp meeting in February (an interesting concept,) and then were married twice: once by the state and once by the church.  That’s the way it’s done in much of the world (things get complicated when it’s not done in that order, as Prince Alexander of Belgium found out.)

There are some in the LGBT community who want to do just that in this country, which–following an example that goes back to Calvin’s Geneva–has heretofore preferred to empower ministers to solemnise marriages.  But the simpler solution is to get rid of civil marriage altogether.

Let’s take this to the next level, Gene, and stop wasting people’s time in the quest for same sex–or any other–civil marriage.

David Martin’s Preface to the New Testament

le_nouveau_testament-8One cannot be happy without knowing God, and one can only know him well by the divine Scriptures.

The world is, in truth, like a great open book where one can see the brilliant handiwork of an infinite power and a wisdom worthy of worship.  The heavens declare, said the Prophet King, the glory of God; and the firmament sheweth his handywork. (Psalm 19:1)  And St. Paul said to the Romans, For the invisible things of him from the creation of the world are clearly seen, being understood by the things that are made, even his eternal power and Godhead (Romans 1:20).  But sinners and criminals that we are, we especially need to know God by means of his mercy; now it is only from himself that we can know him, and to learn with certitude that he, in view of the expiation which was done by his Son Jesus Christ, wants to pardon our sins.  The Books of the Old Testament had predicted this happy expiation, and it had long been prefigured in the blood of the victims which were sacrificed by the order of God; but the Books of the New speak to us of an expiation which is a fait-accompli.  Isn’t it a consolation to a soul, deeply afflicted by sins, to learn from these divine Scriptures that there is no condemnation to fear when, with a sincere repentance and a faith enlivened by love, that soul has recourse to Jesus Christ and, supported by the intercession and based on the merit of this divine Redeemer, can go with assurance to the throne of grace, to find mercy, and obtain salvation, life and immortality?  This great and consoling truth presents itself to us in virtually every page of the Books of the New Testament, but it is never detached from the obligation to love God, and to keep his commandments.  Truly one of the most dangerous illusions of self love is to pretend to find salvation in faith in Jesus Christ, and then to proceed as if there is nothing else left to achieve.

From this comes the loosening of morals and a nearly universal negligence of the most essential duties of Christianity, even among the most Orthodox of Christians.  One reads the Scriptures to make oneself wise more than to make oneself holy, without realising that only knowledge of Religion is nothing but an amusement of one’s spirit, or a light which is only good for dazzling, and which in dazzling deceives, and leads to going over the cliff of damnation.  The person who wants to profit from the reading of this Holy Book reads it to learn how to sanctify oneself by the practice of good works.  He takes Jesus Christ as his model as well as Saviour, because he cannot be our Saviour if he is not our model.  This is the constant teaching of the Holy Apostles, and Jesus Christ himself often expressed this in the strongest of terms, that it was necessary to renounce the Gospel, and to read it only for one’s own condemnation, unless one was to follow its holy principles, and practice all of its duties.   And as many as walk according to this rule, peace be on them, and mercy (Galatians 6:16) of God, Amen.

The preface by the Huguenot pastor David Martin of his translation of the New Testament into French, 1731

State Secrets: Maybe It’s a Setback for the Obama Administration, and Maybe It Isn’t

The Atlantic tells us that a recent court decision in California is a setback for the Obama Administration:

The Obama administration suffered a bit of a legal setback this afternoon: a federal judge in California rejected the administration’s assertion of the state secrets privilege in the civil suit brought by an Islamic charity that was allegedly subjected to illegal NSA surveillance.  The order, in Al-Haramain v. Bush, requires the government to come up with a way to safeguard the classified information it plans to present in the NSA’s defense by May 8.

That depends upon how you look at it.

It’s the endless dilemma for liberal administrations.  When they’re out of power, they rail endlessly (and have done so since the days of wine and Frank Church) about how awful all of of these state secrets, and alleged violations of human rights, and shows of military power, are.  When they’re in power, they fret that, if they really put their idea of open government under strict international law into practice, they themselves will be its victims.  That’s what the Obama Administration faces in, for example, the Spanish move to prosecute Bush officials (to say nothing of what some in Congress would like to do.)

In this case, the “principled” thing (from a purely liberal standpoint) to do would be to just blow the secrets out into the open and be done with it.  But if they did, then they would weaken themselves vis à vis the “right wing extremists” they’re fingering.

Two years ago, I described this conundrum as “Dzerzhinskii’s Dilemma“:

To understand this, we must first realise that the Democrat party today is the party of the 60’s radical. That includes just about every major player in the party. At the heart of sixties radicalism is rebellion against authority, especially the military and the police. When they’re not worried about what authority can do to them at the present, they worry what it might do to them in the future. That’s why the ACLU constantly attempts to undermine anti-terror efforts by the government.

As a practical matter, one would think that they would realise that, if they ever did gain power, the police and military would be essential elements in their ability to maintain it. And sometimes they do know this; the Clintons have never been shy about using the power of law to protect them personally and to advance their own proper interests. But in general the Democrats are reflexively unable to empower the military and police to protect us out of a fear they will repress us, even in the face of Islamicists who would wipe out their way of life more surely than anything else…

So the Democrats are stuck. They simply cannot bring themselves to allow our military and intelligence services to do what they have to do. So the vote to keep them weak in the face of public opinion to the contrary. The Democrat Party and the American left is trapped in Dzershinskii’s Dilemma, where if they neglect national security we lose and if they beef it up they get wiped out. They never will find a way out. We vote for such people at our own peril.

What we protest for in the streets is always fun until we have to implement it in the halls of power.