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CAN MEDIEVAL MONACO SURVIVE THE 21ST CENTURY?
In A quirk of time and space, a motorist can leave France’s A8 motorway near Nice and, without seeing so much as a welcome sign, downshift into a jet-age version of the 12th century. But the 900-year-old enclave of Monaco is an anachronism at risk as a different sort of Europe takes shape. Medieval Monaco, with its storybook palace looming on a rock above the high-roller casino of Monte Carlo, is in some danger of melting away into France. Rainier III, the ramrod-straight prince who spent 50 years turning an oddment of history on a speck of barren Riviera coast into a sparkling hideout for the eccentric rich, is 81 and ailing.
The world is changing quickly around Monaco. Its French neighbours now belong to a 25-nation European Union bent on eradicating old anomalies. To survive, it is likely to need a tough-minded ruler. French authorities refuse comment on the status of Monaco, but a message was sent in 1962, when President Charles de Gaulle resolved an economic dispute with a bald show of force, and Rainier backed down in a face-saving compromise.
Monaco’s independence is in many ways a state of mind. It issues passports and postage stamps. An elected legislative council drafts bills for the prince to sign. The principality belongs to the United Nations. But even before the EU abolished checks at French road borders, visitors breezed into Monaco without realizing it. The currency is now the euro. And Monaco’s prince chooses his prime minister from among three Frenchmen picked in Paris. Quietly but increasingly, people speculate that a future French government will be tempted to exert sovereignty in the absence of a strong leader.More on this story here.
DALMATIAN COAST THE NEXT RIVIERA
It would not be quite fair to call the Dalmatian coast of Croatia undiscovered, even if most Americans have at best a hazy idea of where it is. The Greeks discovered it 400 years before Christ, sprinkling its 1,100-odd islands with colonies. Since then waves of imperial sun-seekers have washed across its rocky shores, from the Romans to the Byzantines to the Venetians, all leaving behind splendid buildings to mark their landlordship. The Roman Emperor Diocletian spent his twilight days in the Croatian city of Split at what may be the biggest retirement home ever built, its main bedroom wing protected by a portico 517 feet long.
Dubrovnik, a Renaissance jewel 110 miles to the south, was shelled briefly by the Serbs in 1991 during the breakup of the former Yugoslavia. War has not cast a shadow on the region for almost ten years now, and Dubrovnik has been completely restored. Now Dalmatia’s storied coast is being discovered all over again, this time as the Mediterranean’s next Riviera -- and as an investment opportunity in the second-home sector. The old Riviera, of course, has not gone away. Come summer, hordes will infest the beaches of Spain, France and Italy. Miles of once-lovely coast now have all the charm of Atlantic City, with water so murky you can barely see your toes.
Croatia, meanwhile, has been waiting patiently. Communism and ethnic strife have kept it isolated and underdeveloped. Over here the Med (technically the Adriatic) still sparkles. Beaches may be rocky, but the absence of sand leaves the waters preternaturally clear. Steep limestone hills thatched with rosemary, olive trees and lavender loom dramatically out of the sea. Port villages boast fortresses, churches and palazzi, all built from the same stone. IberianSun, an English real estate agency that helped turn Spain’s Costa del Sol into a London suburb, has understandably been looking for the next candidate for overdevelopment. Compared with Europe’s A-list beaches, Croatia’s are still cheap. Modest stone houses on the islands can be had for as little as $70,000, and $150,000 buys a very comfortable 1,100-square-foot vacation home. But attempting purchase is not for the faint of heartMore on this story here.
10 WAYS TO AVOID BUYING FAKES ONLINE
Nearly 50% of Americans bought something online last year, according to market consultancy JupiterResearch. Unfortunately, as many as 10% of those consumers were fooled. Instead of buying what they thought were genuine products, they ended up with counterfeits. Indeed, fakes of all shapes and sizes are proliferating online. On June 21, high-end jeweler Tiffany & Co. sued eBay, alleging that 73% of the Tiffany brand-name jewelry sold there was counterfeit. On June 17, the U.S. General Accounting Office issued a report showing that 4 of the 68 drug samples investigators bought in U.S. and foreign online pharmacies, were fake. Peter Neupert, chairman of online retailer Drugstore.com, partly blames mounting health-care costs, rising at double digits annually for prompting patients to seek cheaper alternatives for prescription drugs.
Overall, discerning a fake online is no simple task. You cannot finger the item as you might in a brick-and-mortar store. You cannot take a good look at the seller or his shop to see whether or not they look legit. However, the case for safe cyber-buying is not hopeless. Online consumers can take lots of steps to protect themselves from getting scammed by the charlatans. To help you in this effort, BusinessWeek Online has put together 10 tips from experts on how to avoid buying fake goods online.More on this story here.
SUPREME COURT PUTS FINAL NAILS IN COFFIN OF BILL OF RIGHTS WITH HIIBEL CASE
June 21, 2004 is the date the U.S. Supreme Court put the nail in the coffin of the Bill of Rights. For all practical purposes, we can declare them dead -- and, similarly to what happened to Tom Paine, the death seems to have been largely unnoticed. The Hiibel case is the one that killed the Fifth Amendment, which had been struggling on life support for a while. I really cannot say any more about this one, except to point you to a very compelling essay by Mr. Hiibel himself. He says it much better than I could. I have not seen any mainstream (that is, nonlibertarian) coverage of the thorough destruction of the Bill of Rights. The magnitude of the task before those of us who love freedom has been revealed, in the yawning indifference of Americans to this decision. On June 21 the Supreme Court killed any pretense that may have remained of protecting the Constitution, and thereby U.S. citizens, from abuse at the hands of the state. And most of America scratched, belched, and turned on the TV.More on this story here.
WHY THE U.S. CANNOT BE TRUSTED WITH PERSONAL DATA
Recently, the EC announced -- over vocal objections by the European Parliament and its own advisory group -- that it will permit the U.S. government direct access to airline passenger data. This means that before you fly to or via the United States, details of your reservation, including credit card number, flying history and even meal preferences, will be transmitted to the US government for “screening” and will be retained in a database for a minimum of 3.5 years up to an indefinite period. This is not the time to be turning over the personal data of European residents to the American government.
First, there is no evidence that collection and monitoring of personal information does anything to stop terrorism. The next terrorist is more likely to be an undocumented student from rural Pakistan than a convicted criminal. He is not going to have charges from Osama’s Live Bait and Fertilizer Shop on his American Express card or a subscription to Terrorist Weekly.
Second, and more seriously, is that the United States has a long -- very long -- history of abusing personal information and surveillance powers for political purposes to the detriment of the entirely innocent. Whether we are talking about FBI surveillance and intimidation of suspected communists in the 1950s and 1960s or physical abuse of French journalists arriving in the US in 2003, America has a problem distinguishing real threats from imagined ones. The US has long had a problem respecting other nationalities. Its conviction that it alone holds the ideals of truth, justice, freedom and democracy is both wrong and dangerous. As part of this lack of respect, official degradation and humiliation of foreigners by those in positions of authority seems to be an important ritual, whether it is Najaf or New York.
If you have every tried to have your credit report corrected, you will agree that software and bureaucracy can create a disaster waiting to happen. Except this time it is not a loan you will be denied when a mistake is made -- it will be your liberty. We -- whether US citizens or not -- did not elect the American administration to watch over the world and collect this information. It is neither accountable nor in any way transparent as to its methods, objectives and results. Information is power, and the US is grabbing fistfuls of it to our peril.More on this story here.
ST. KITTS FOUNDATIONS PRIMER
The Foundations Act, 2003 provides for the establishment of Foundations in St. Kitts. The concept of a foundation consists of the endowment of a specific amount of assets for a specific purpose (object) determined in the articles of the foundation. An appointed body known as the Board of Councillors is entrusted to carry on the business and affairs of the Foundation and to pursue its objects. The person(s) who creates the endowment is known as the founder and the persons who benefit from the endowment are known as the beneficiaries.
Once the articles of the foundation are registered in the Register of Foundations, the property endowed or to be endowed becomes an estate separate and apart from that of the founder by acquiring a judicial personality of its own, thus becoming a foundation. The information concerning the names and the rights of the beneficiaries of the foundation is usually provided to the Board of Councillors by means of a private and confidential document (which does not have to be registered) known as the By-Laws which may include regulations providing for these matters.
Unlike the traditional corporation, the foundation does not have a share capital, it does not recognize shareholders and the founder does not retain or acquire any such ownership rights in relation to the foundation’s property. The law does recognize, however, the beneficiaries or the persons in whose benefit the foundation is created, which can include the founder. A foundation may be established for any purpose for which foundations are normally established, which purposes shall be spelled out in the articles of the foundation and are permissible under the laws of St. Christopher and Nevis. St. Kitts foundations cannot be simply profit oriented or used to carry on a particular business. A foundation may be used as a holding entity for underlying companies and it can in the course of the management of its assets, do such things as are necessary for the proper administration of its assets, including but not limited to buying and selling such assets and engaging in any other acts or activities which are not prohibited under the law of the Federation, provided that such acts and activities are ancillary or incidental to its main purpose.More on this story here (reasonably nonintrusive registration required).
CAN YOU OVERHEAR ME NOW?
The Justice Department has asked the Senate for help in extending hidebound, phone-company style wiretap capability into new Internet-based phone calls (called “VoIP” for Voice over Internet Protocol). They argue leaving the new technology unregulated would make it harder to monitor possible terrorist communications. Meanwhile, some states hope to regulate these same phone services so they can collect taxes from and otherwise control them. To its credit, a skeptical Senate is considering legislation to prevent such interference with VoIP. Telling opportunistic states to back off is straightforward. But Washington’s desire for easy surveillance, and the ways it is increasingly facilitated, is a tougher problem.
Real-time monitoring of our conversations, whereabouts, movements or transactions is already at hand. VoIP wiretapping is just the latest. Washington must better explain its philosophy regarding surveillance technologies. At the very least, new surveillance powers should apply only to terrorism, not to routine criminal investigations. Unfortunately, law enforcement infrastructure like Internet phone wiretaps will ease the monitoring of nonterrorists. Perpetrators of victimless crimes will surely find themselves under renewed scrutiny, however beyond the rationale of combating terrorism.
With regard to the new phone-tapping campaign, Privacilla.org founder Jim Harper noted, “The law enforcement cart is coming before the civil society horse. The communications infrastructure is being created with eavesdropping in mind before there is any evidence of [the need for] it.” Besides, Mr. Harper notes, criminals will use offshore VoIP or open source VoIP instead of major carriers. As a practical matter, enhanced Internet phone surveillance could mean costly equipment upgrades and industry regulation to run the scheme.More on this story here.
INVESTORS TRYING TO HEDGE THEIR BETS
It is estimated that there are now more than 8,000 hedge funds worldwide with AUM (assets under management) of more than $800 billion. According to a hedge-fund industry group, Hedge Fund Research, the industry pulled in the remarkable figure of $22.2 billion in the first quarter of 2004 alone. However, even as the industry attracts more interest and is growing in size, there are still some concerns among major market players in Asia.
In an interview with China Daily, Christopher Lee, chief executive officer of SHK Fund Management Limited -- Alternative Investments Division, which sources hedge funds based in the US and Europe for investors in Asia, says that while demand is not an issue, finding the right manager can be an onerous job. “It’s getting tougher to find good managers and also hard to negotiate the capacity you want,” says Lee. With more hedge funds mushrooming, this means increased competition. Lee concedes that one of the team’s biggest challenges would be to find the right manager to suit its clients’ needs in Asia. “Good funds are hard to find, the best funds are often closed.”
In most cases, investors in Asia are not fully aware of the well-known and well-respected hedge funds based abroad and, more importantly, the various ways to monitor them. Nevertheless, the division’s research team has tried to provide additional value and comfort to their investors by making the “extra” checks on hedge funds and their managers. According to him, the selection process of finding the right manager is quite exhaustive and can take anywhere from six to nine months. A majority of the hedge funds which investors in Asia are interested in are based in the US and Europe, and the team often engages private detectives to do background and security checks on the managers, as part of their due diligence, especially in the final vetting process.Link here.
A LOOK AT THE RFID-TAGGED FUTURE
I am in a supermarket called the Extra Future Store in Rheinberg, Germany, 40 kilometers north of Düsseldorf, jonesing for a bit of Philadelphia cream cheese. I feed my request into the touchscreen console on my shopping cart, and up pops a map showing the optimal path to the dairy section. I steer over and grab a box -- regular in name but far smarter than the average cream cheese. The package carries a computer chip that talks to a 2-millimeter-thin pad lining the shelf under the box. When I pick up the cheese, sensors in the pad notify the store’s database that the box has been removed. I exchange the plain for the mit Kräuter (with herbs) then, wracked with indecision, snag the low-fat version. It turns out it is not really all that low-fat anyhow, so I put it back down. My waffling will produce a flurry of data back at Kraft Foods headquarters. The company, which gets this information in return for subsidizing the smart shelf and the microchips attached to the packages, will use the data to analyze my behavior. The marketing department will likely draw some kind of conclusion from my skittishness -- a hint that maybe “low-fatness” is too Spartan a theme for a hedonistic schmear anyway. Of course, they will also have serious insight into my personal shopping habits.
The star of the show is the radio frequency identification chip -- a piece of circuitry about the size of a grain of sand. Thanks to the coordinated efforts of the world’s biggest retailers and manufacturers, not to mention the persistence of former lipstick marketer Kevin Ashton, these little tags are about to infiltrate the world of commerce. Depending who you ask, RFID tags constitute 1.) the best thing to happen to manufacturing since the cog, 2.) the biggest threat to personal privacy since the crowbar, or 3.) the near-exact fulfillment of the Book of Revelation’s description of the mark of the beast. There is a compelling argument for each of these perspectives -- including number three.More on this story here.
DUE PROCESS? CHECKS AND BALANCES? THEY SOUND LIKE GOOD IDEAS
On Tuesday, July 6, 2004, Judge Reggie Walton made a decision and ruled on my case. Under his ruling, I, an American citizen, am not entitled to pursue my 1st and 5th Amendment rights guaranteed under the Constitution of the United States. The vague reasoning cited, without any explanation, is to protect “certain diplomatic relations for national security”. Judge Walton reached this decision after sitting on this case with no activity for almost two years. He arrived at this decision without allowing my attorney and I any due process: NO status hearing, NO briefings, NO oral argument, and NO discovery. He made his decision after allowing the government attorneys to present their case to him, privately, in camera, ex parte; we were not allowed to participate in these cozy sessions. Is this the American system of justice we believe in? Is this the due process we read about in our civics 101 courses? Is this the judicial branch of our government that is supposed to be separate from the other two branches in order to protect the people’s rights and freedom?
This court decision by itself would have been appalling and alarming enough, but in light of all other actions taken against my case for the past two years it demonstrates a broken system, a system abused and corrupted by the current executive, a system badly in need of repair. Under this broken system the attorney general of the United States is being allowed to illegally gag the United States Congress regarding my case. And even worse, the United States Congress is readily complying with this illegal gag.
Under this broken system the attorney general of the United States is being allowed to hinder ongoing investigations such as those of the 9/11 Commission and the DOJ-Inspector General. Under this broken system the Attorney General of the United States is getting away with interfering and tampering with pending cases under the judicial process, such as my court cases and the lawsuit by the 9/11 victim families. On September 11, 2001, 3,000 lives were lost. Yet this administration has hindered all past and on going investigations into the causes of that horrific day for the sake of this vague notion of protecting “certain diplomatic and foreign relations.”More on this story here.
THE LIFE AND DEATH OF CIVILIZATIONS
Only the most vacuous minds -- whose opinions are grounded in conventional delusions rather than empirical evidence and rational analysis -- can fail to recognize that modern civilization, as we have known it, has reached a terminal state. No amount of public opinion polling can reinspire its former greatness. The only question is whether its remnants can be transmuted into fundamentally new forms and practices making for a more free and productive society, or whether it shall continue its downward spiral.
Western civilization appears to be at a bifurcation point -- one of those conditions that eventually confronts systems. The study of “complexity”, or “chaos”, informs us that a complex system can be thrown into turbulent states to which it might respond either by actions (or inaction) that hasten its collapse into total entropy; or by the development of practices that allow it to adapt to the complexities it encounters. Such processes are seen in the efforts of biological systems to sustain themselves, in the mind’s debate between learning and ignorance, in the competitive success or failure of businesses, or in the life and death of entire civilizations.
Once vibrant social systems began producing their life-promoting values, the forces of death began to ooze up from the depths of humanity’s “dark side”. People who were incapable of creative acts themselves, or were envious of the successes and rewards enjoyed by others, resorted to violence to despoil others. From simple acts of piracy and pillaging, clever minds developed formal systems (i.e., governments) and intellectual rationales (i.e., political philosophies) that would institutionalize theft and the violent methods upon which thievery depends. It should come as no great news to report that when “dark side” forces begin to prevail -- whether within an individual or a society -- life-promoting qualities and values go into a decline.More on this story here.
WEALTHY SEEK SOLITUDE IN THEIR OWN LITTLE KINGDOMS ON PRIVATE ISLANDS
Wallace Tutt made a name and a fortune designing and building lavish homes for the glitterati -- Gianni Versace’s mansion in Miami Beach, houses for Cher in Florida and California. But when he searched for a location for his own ideal home, he chose a tiny private island where he takes refuge in solitude, lying in a hammock surrounded by turquoise waters far from the demands of society.
Caribe Cay, valued at $3.5 million, is one of dozens of private islands that dot the Bahamas and other countries across the Caribbean. Living such a life is pricey and logistically difficult, but in the past few decades a lucrative business has grown from selling and leasing islands to people seeking their own private paradises. It is not just in the Caribbean. Islands are for sale from Fiji to Nova Scotia, ranging from house-less islets costing less than $100,000 to sprawling islands with mansions or resorts priced in the tens of millions. The Bahamas has a particularly large number -- real estate agents estimate 60 or so are scattered across the archipelago of 2,700 islands and cays off Florida.More on this story here.
10 TRUTHS ABOUT TRADE: HARD FACTS ABOUT OFFSHORING, IMPORTS, AND JOBS
As globalization sending the best American jobs overseas? If you get your news from CNN’s Lou Dobbs, the answer is “of course” and the only real issue is how many trade restrictions should be applied to stem the bleeding. But the recent scare about “offshoring” is just the latest twist on an inaccurate, decades-old complaint that global trade is stealing jobs and causing a “race to the bottom” in which corporations relentlessly scour the world for the lowest wages and most squalid working conditions. China and India have replaced 1980s Japan and 1990s Mexico as the most feared foreign threats to U.S. employment, and the old fallacy of job scarcity has once again reared its distracting head.
The truth is cheerier. Trade is only one element in a much bigger picture of incessant turnover in the American labor market. Furthermore, the overall trend is toward more and better jobs for American workers. While job losses are real and sometimes very painful, it is important -- indeed, for the formulation of sound public policy, it is vital -- to distinguish between the painful aspects of progress and outright decline. Toward that end, and to counter protectionist “analysis” masquerading as fact, here are 10 core truths about global trade and American jobs.More on this story here.
INVESTING AS AN ENTREPRENEURIAL ENDEAVOR
It is commonly thought that the U.S. economy reaps the benefits of an entrepreneurial economy and its stock market is merely along for the ride, providing participants double-digit returns as far as the eye can see. Stock ownership has in recent years come to the masses, who fully expect to profit not from their own unique vision, but because “stocks always go up in the long run,” or so they are told. Can the multitudes profit in the investment sweepstakes? Is capitalism, in fact, democratic? Are we entitled to all get rich together? Looking at the great bull market from 1988–1999, the answers appear to be “yes”. The S&P 500 returned 19.0% per annum with dividends reinvested. Even if the 2000–2002 bear market is included, stocks gained 14.2% annually for the 1988–2004 period.
Unfortunately, the typical investor did not achieve these returns. First, he was late to the party. In 1989, at the onset of a decade that saw the Dow Jones Industrials Average quadruple, just 31.6% of households owned stock. By 2001 stock ownership had swelled to 51.9%. Second, investors chased momentum to their detriment, in essence navigating the markets through a rear-view mirror. According to a recent study by financial research firm Dalbar, from 1984-2002 the S&P 500 returned 12.2% annually, yet the average stock investor earned a meager 2.6% per year.
How can Austrian economics in general and Ludwig von Mises’s wisdom about entrepreneurial profit in particular improve an investor’s returns? We think in several ways: 1.) Invest in market entrepreneurs with a margin of safety (sustainable businesses, reasonable valuations, and solid balance sheets); 2.) Look for investment opportunity in foresight apart from the consensus; and 3.) Avoid the economic errors of the crowd.
The interplay of wealth creation (entrepreneurship) and destruction (government intervention) is constantly at work; it is the focus and mood swings of investors that change. Major stock market lows are often set when the failures of the state are exposed and become engrained in the public psyche. Depression (1932), world war (1941), expected return to depression (1949), inflation (late 1970s), and deficits (late 1980s) created the best buying opportunities for investors of the past 75 years. How does the future -- viewed through the lens of an Austrian economist -- differ from the outlook of the typical investor? Are investors justified in their optimism? From an Austrian perspective, there appear to be several likely events, in order of their unfolding.Link here.
AIRLINE SCREENING SYSTEM DELAYED
A controversial and much-delayed proposed airline screening system may face further delays as the Transportation Security Administration restructures the system to better protect privacy and civil liberties, a senior homeland security official told Congress. Adm. David Stone, acting administrator for the TSA, told members of the Senate Commerce Committee that the Computer Assisted Passenger Pre-Screening System II, known as CAPPS II, “is not going forward as previously briefed.” He said the rethinking was in response to a February report critical of the program, as well as the TSA’s own privacy concerns.
The TSA had hoped to start testing the program with real passengers this summer. Stone did not estimate how long the delay would be. The system, as originally proposed, would require all passengers to provide extra information when booking a ticket -- information that airlines do not currently ask for, like addresses, phone numbers and dates of birth. The system would then check that information against databases of criminals and terrorists and assign each passenger a green, yellow or red score, according to perceived risk. Civil-liberties groups from the left and right have gained powerful allies on Capitol Hill by arguing the system is both too invasive and ineffective.
According to Stone, the agency is reconsidering validating travelers’ information against commercial databases, criminal records and the government’s terrorist watch list. It is also reconsidering the color-coding scheme. CAPPS II is intended to replace the current system run by airlines that checks names against a no-fly list and picks out passengers for extra screening based on behaviors such as paying with cash.
The Transportation Security Administration had budgeted $60 million for CAPPS II next year alone. “It was falling under its own weight -- not just the privacy concerns, but the sheer impracticality of it,” said Barry Steinhardt of the American Civil Liberties Union. “It was always a question of when they were going to pull the plug.”More on this story here, here, and here.
THE IRS GRANTS A WISH
The ruling makes clear that the person who sets up the trust -- the grantor -- can pay the annual income taxes owed by the trust without the payment being treated as an additional taxable gift to the beneficiaries of the trust (say, the grantor’s children or grandchildren). In addition, the ruling explains how trust documents should be worded to avoid the horrendous result of having all of the assets in a trust included in the grantor’s estate when he or she dies. The way the math works, after 20 years of the grantor paying the income taxes for the trust, there could be twice as much in the trust as there would be if the trust paid its own taxes, says Bernard Kent, a tax partner with PriceWaterhouseCoopers in Detroit.
Grantor trusts are the bread and butter of estate planning for families with $5 million-plus in assets. It is common for a husband and wife to each set up a $1 million grantor trust to take advantage of the amount any individual can give away over his or her lifetime gift-tax-free. (That is in addition to the annual gifts of up $11,000 you can make gift-tax-free to as many recipients as you like.)
In a basic grantor trust, the grantor puts $1 million in cash or assets into a trust -- often choosing assets such as initial public offering stock expected to appreciate a lot -- and the money in the trust goes to the trustee after the grantor dies. A traditional trust itself pays taxes on its trust income while the assets grow. Or if the money is distributed, the beneficiaries pay the taxes. However, in the grantor trust version, the grantor pays the taxes on the income. This has two benefits: First, the money builds up faster; second, the grantor is getting additional money out of his/her own taxable estate.
Estate planners have been using grantor trusts for the past two decades, but they always had to warn clients that the IRS might consider the income tax payments by the grantor to be further taxable gifts to the beneficiaries of the trust. Worse, if the trust were required to reimburse the grantor for taxes paid, that could arguably cause the assets of the trust to be included in the grantor’s estate, essentially killing the whole strategy. The new IRS ruling, technically a “revenue ruling” that applies to all taxpayers, puts both these fears to rest.More on this story here.
5 THINGS ABOUT OFFSHORE ASSET PROTECTION EVERY INTERNET MARKETER SHOULD KNOW
Offshore instruments of asset protection no longer belong in the realm of the wealthiest individuals with high paid financial advisors. Thanks to the internet and globalization of financial markets, there are plenty of firms that can help just about anyone “go offshore”. What follows is a brief introduction to some of the most popular tools of offshore asset protection and how they can be used by online business people and internet marketers like yourself to protect and grow your business.More on this story here.
HOW TO GET RICH. FIRST, TELL YOURSELF “I WANT TO BE RICH.”
Sure, you would like to be rich. You cannot stop humming that song, “If I Were a Rich Man”, from Fiddler On The Roof, and you fantasize about what you are going to do with all that cash. But can you say, with conviction, that you are actually going to be wealthy? That you have decided to be wealthy? That, according to Mr. Wee Tiong Howe, is the first step to good financial planning. The chairman of IPP Financial Advisers recommends that right at the start, your must make the conscious decision that you are going to be wealthy.
Of course, just making the decision is not going to put you on the path to millions. That is just the fuel. Financial planning is the ignition. What simple steps can the layman follow to keep his reserves in order? First, plan your cash flow carefully. Mr. Wee recommends saving up to 30-40% of income per annum. Budget for high savings, and work hard to build up your cash reserves. Second, keep an eagle’s eye on your insurance. Third, invest wisely. Mr Chong urges investors to fight against the emotions of greed and fear. Fourth, review your home loan every year, especially since interest rates are likely to be rising. Fifth, keep a tight hold on your debts. He advises that the ideal level of debt is equivalent to your annual income, but with such high living costs, limiting debt to the optimum will be hard to achieve.Link here.
THE MAN WHO HELPED KILL CAPPS II
Bill Scannell, former Army spy, knows all about the tools governments use to keep their people in line. He was in South Africa just as Nelson Mandela was freed. He was in Bosnia and Kosovo when Slobodan Milosevic tried to extend his grip. And he saw East Germany in the last days it held its totalitarian reins. That is why he could not stand the idea of the American government asking for his papers. So when Delta Airlines announced that it was teaming up with IBM and the Transportation Security Administration on a pilot program to comb through airline passengers’ private records for terrorist connections, Scannell blew his cork. The project, CAPPS II (short for Computer Assisted Passenger Pre-Screening System II), was a cornerstone of the Bush administration’s plans to prevent terror in the skies. It scared the hell of out Scannell, a former Army signals intelligence officer, war correspondent and online agitator.
Established civil liberties groups were already on CAPPS II’s case. Scannell had no organization, and few, if any, connections in Washington. So he did what he could, by putting up a Web site, BoycottDelta.org, calling on travelers to avoid the carrier for its role in the screening effort. It would be the first of many sites he would devote to bringing CAPPS II to a halt.
It seemed like the steepest of battles back then, in February 2003. On the cusp of the Iraq war, Bush’s popularity was in the stratosphere. Challenging the White House’s antiterror regime was an unpopular proposition, at best. But now, in an unlikely turn of events, the Bush administration appears to have backed down. On Wednesday, according to USA Today, Homeland Security Secretary Tom Ridge announced that yes, a stake had been driven through the heart of CAPPS II. Exactly what role Scannell played in offing this vampire depends on whom you talk to.More on this story here.
MONETIZING ENVY AND AMERICA’S HOUSING BUBBLE
It is claimed that home ownership is the American dream. In days gone by, married couples would save enough money to make the once-standard 20% down payment on a house. Unless one could obtain financial assistance from a relative, there were typically no shortcuts to building up the savings necessary to make the aforementioned down payment on a starter home. Therefore, a future-oriented mindset would become the order of the day (a wonderful and measurable side-effect, of future orientedness/low time preference, is that of low interest rates). Americans would sacrifice some current consumption and set aside the savings necessary to reach that home-ownership goal. The virtues of hard work, thrift, and discipline were rewarded when the day came that the local banker approved the mortgage loan -- naturally, the local banker approved the loan as he took the time to get to know his customers and felt that hard-working, thrifty, and disciplined people were good credit risks. If you did not have the work ethic and discipline to save for a house, then too bad; envy be damned.
Alas, these days are long gone. America has devolved from a republic to a social democracy. Politicians exploit, and pander to, the basest of human feelings: envy. (As John Adams wrote in a letter to Thomas Jefferson “…democracy will envy all, contend with all, endeavor to pull down all, and when by chance it happens to get the upper hand for a short time, it will be revengeful, bloody, and cruel.”) In turn, everyone is now entitled to own a home. Indeed, even if the federal government needs to redistribute wealth, to help Joe and Jane Slackard buy a home, then redistribution it will be. If interest rates are too high, because of a present-oriented American populace (i.e., Americans do not save anymore due to high time preferences), then the Federal Reserve will lend a helping hand by creating billions upon billions of dollars -- right out of thin air -- in order to drive down interest rates. In essence, the Federal Reserve is monetizing envy (or should I say unleashing “animal spirits”) so that everyone can borrow and spend to buy a home, furnish it, put two new cars in the garage, and live the American dream. Of course, the United States’s housing bubble is going to end in an economic nightmare.
With key factors falling into place, it appears this housing bubble has come about as an accident of history. When combining all of the factors, a volatile cocktail has been concocted. Inevitably, when a high-time-preference populace collides with artificially low interest rates, something unsavory is going to happen. In this case, the monetary “energy” unleashed is flooding into the housing market. What has ensued is a housing bubble destined to go supernova. How in the world have we gotten here? I will try to explain.Link here.
RANKING THE WORLD’S TOP ASSET HAVENS
Our top choices remain unchanged from last year. As we did in making our original choices, we considered:
And the winner is… Switzerland, still the world’s best money haven. Panama, Liechtenstein, and Hong Kong round out the top 4. If you are doing business in Asia, and especially in China, Hong Kong is the place to be.More on this story here.
OWN YOUR OWN ISLAND ... IN THE ARABIAN GULF
This is the question troubling every bored billionaire: you have got the penthouse, the estate, the villa, the yacht, the plane. What else is left to own? The answer: a country. And every one of these countries comes with guaranteed sun, sea and sand. Welcome to the brave new world taking shape a few miles out in the warm waters of the Arabian Gulf. Here, one of the world’s richest families is building a jigsaw of 300 private luxury islands to create a nation-by-nation, state-by- state replica of the entire planet.
The only difference is that you will have to be eye-poppingly rich to live in this world. Spain is still on the market at £20 million. So is California (£18 million), Sweden (£9 million) and even Iraq (£7 million). But Britain has just been snapped up -- for around £18 million -- by an anonymous “British male celebrity singer”, who is due to unveil his plans for it in the next few days. At least Britain remains in British hands. Whereas Ireland has been snaffled for £9 million by a Dutch tycoon whose wife wants to build a huge castle there. Australia has been bought by a consortium from Kuwait.
The French face humiliation. A very wealthy, very mischievous American is thinking of buying France (£18 million) just so he can stick the Stars and Stripes on it. And if the Argentinians are still pining for the Falkland Islands, they can buy them for a mere £13 million. It is all the idea of Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and a man who likes to think big. This is his biggest, brashest and, possibly, barmiest idea to date.More on this story here.
“WE DON’T NEED NO STINKIN’ LOGIN”
While many online newspaper readers are used to the idea of registering to read free content online, some news buffs are supporting and creating sites that help them beat the system with fake or shared login information that helps keep their personal information under wraps. Increasingly, Web publishers, and in particular newspaper sites, are demanding that readers give up some of their personal information -- like e-mail addresses, gender and salaries -- in exchange for free access to their articles. The publishers say they need this information to make money from advertising. But anecdotal evidence and online chatter suggest readers are annoyed with the registration process. Some readers enter bogus information, while others are looking for ways to bypass the registration roadblocks.
BugMeNot.com is a site that generates login names and passwords for registration sites. The site is a boon to those who want to keep online anonymity or stamp out spam. According to the site’s homepage, 14,000 Web sites have been “liberated” from registration bondage, and it is clear many people are doing whatever they can to avoid really logging in. According to the site’s creator, an Australian who wants to remain anonymous for fear of lawsuits, the site is getting about 10,000 hits each day. In an e-mail interview, BugMeNot’s creator said he started the site in November 2003 after being annoyed for some time with forced registration on some sites. One BugMeNot aficionado, Eric Hamiter, is doing his part to help the site’s cause -- he created a plug-in for the Mozilla browser that gives users a pop-up window with login information when they land on a registration-only newspaper site.
There is also Mailinator for those who want to register but do not want to use their real e-mail address. And there is spamgourmet for “eating” unwanted e-mails. There is also The New York Times link generator put together by an Illinois teen computer programmer, Aaron Swartz. Swartz’s page lets bloggers post links to Times articles that can be viewed without having to log in to the site. But while users of such sites might think they are getting around invasive registration practices, newspapers that require users to log in do not necessarily see their policies as such.More on this story here.
ECONOMIC FREEDOM AND CONFUSION IN LATIN AMERICA
Economic freedom in Latin America noticeably increased in the 1990s. The region’s economies are now more open to trade and investment and, in most countries, high inflation and the prevalence of state-owned monopolies are things of the past. According to the new Economic Freedom of the World: 2004 Annual Report, Latin American countries increased their economic freedom ratings from 5.0 in 1985 to 5.4 in 1990 to 6.5 on a 10-point scale by the end of that decade. That should be good news, according the report, which is published by the Fraser Institute in Canada, the Cato Institute in the U.S., and think tanks around the world. The study finds a strong relationship between economic freedom and prosperity. Countries that are more economically free are more prosperous and tend to grow faster than those that are not.
But in Latin America the policies of the 1990s culminated in low growth and economic turmoil in much of the region. The widespread perception that the free market has been tried and failed has led to the rise of neo-populist rhetoric and incoherent policies. Whereas the so-called Washington Consensus on the need for orthodox macroeconomic measures prevailed in the early 1990s, no policy consensus exists in the region today. Disillusionment with the market has reached extremes in Argentina and Venezuela, the two countries that have fallen the most on the economic freedom index. Elsewhere, economic reform has failed to produce political stability.
Has liberalization failed Latin America? The region’s experience does not contradict the findings of the economic freedom index. The financial turmoil of the past 10 years, which did so much to sour pro-market sentiments, was the result of policies fully inconsistent with market reforms. Fiscal irresponsibility and debt mismanagement caused the spectacular Mexican and Argentine crises-policy practices that have characterized Latin American governance since the time of independence. Indeed, one of the lessons of the 1990s is the need for a coherent set of market reforms.More on this story here.
The feature article of the June 2004 issue of The Insider, published by The Heritage Foundation, is one of dozens of articles written over the past twenty years or so by Roger Pilon of the Cato Institute urging Americans to educate themselves on how the Constitution supposedly limits government. Cato Institute staffers are known for carrying little pocket-sized copies of the Constitution around with them, presumably so that they will never miss a chance to prove to anyone who will listen that there is indeed a way of limiting government: enforce the Constitution. But this whole enterprise of preaching about the Constitution, as conservatives and libertarians have been doing since at least the 1930s, is utterly futile. It has had no effect whatsoever, yet Cato, Heritage, and many other institutions continue to churn out essentially the same old arguments about how the Constitution can limit government.
The reason all these efforts are useless is that those who partake in them invariably ignore any serious discussion of how constitutional restrictions on government can be seriously enforced. They typically implore the public to educate itself, as though politicians will then magically transform into dutiful tribunes of the people, take their advice, and shut down most of the government. Or they believe in the pie-in-the-sky notion that the federal judiciary could somehow be reeducated and turned into modern-day Thomas Jeffersons, writing such things in their judicial decisions as “that government is best which governs least.”
This is all extraordinarily naïve. The government has had an iron grip on the American educational system for generations, and it is not about to ease up on that grip by teaching American school children about the virtues of limited government. This is true of all levels of education, including -- and especially -- the law schools. Furthermore, elementary public choice theory, which Cato Institute scholars should be aware of, suggests that this crusade will inevitably fail. The reason is straightforward: The parties who are interested in limited constitutional government are widely dispersed and not very well organized politically (i.e., the general public), whereas the advocates of ever-expanding legal plunder (the state itself, and all of its special-interest groups) tend to be much more concentrated and well organized. Therefore, it is the nature of politics that the enemies of constitutional limitations on government will win out, as in fact they have in the U.S. for well over a century.
The fatal flaw in the thinking of the libertarian/conservative constitutionalists stems from their unawareness or willful ignorance of how the founders themselves believed the Constitution could be enforced: by the citizens of the free, independent, and sovereign states, not the federal judiciary. The Constitution not only sought to limit government with its “enumerated powers”, or the system of checks and balances, but also with the much more important doctrine of divided sovereignty. That is, the citizens of the states, as well as all other organs of government, were to have an equal voice in constitutional matters. States’ rights was the key to enforcing the constitutional limitations on the central state. But the system of dual sovereignty was all but destroyed by the Civil War.
The Quixote-like libertarian constitutionalists are wasting their time because they fail to acknowledge the essential truth about Abraham Lincoln’s war: It overthrew the Constitution of 1789 by destroying the system of dual sovereignty and, in so doing, ended any hope that the citizens would remain sovereign over their own government. Indeed, early twentieth century statists and imperialists like Woodrow Wilson celebrated this fact.More on this story here.
JUST AS SCARY AS TERROR: THE U.S. ECONOMIC POLICY
As American voters contemplate their choices in this presidential campaign year, the world’s investors have been voting with their money. The early results are in -- and they do not look good for the United States. Last month, the OECD released figures showing that last year for the first time, China supplanted the United States as the No. 1 destination for foreign direct investment worldwide -- that is, money that goes into factories, equipment, real estate or existing companies. And in a blow to fans of “freedom fries”, No. 2 was France. Though other major economies also suffered a drop-off in this category , no nation fell as far in percentage terms as the United States. While such numbers fluctuate and foreign direct investment is just one type of capital flow, this dramatic swing can be seen as further evidence that in the 21st century, America is going to have to fight hard for its piece of the global investment pie -- money that translates directly into new jobs and the industries of tomorrow. Clearly, the world economy is shifting around us and our place atop it is being challenged.
The OECD report included another revealing statistic: Investment flows into emerging economies grew dramatically between 2002 and 2003, with investors pumping more than six times as much into developing markets as they did in the prior year -- nearly $200 billion. OECD analysts concluded that the primary reason for this redirection of capital was not simply that countries like China offer cheap labor. Rather it was the size and promise of their markets. This is a big deal, because even when low wages in these countries go up, that will mean increased buying power -- so the attractive labor markets of today will gradually become the attractive consumer markets of tomorrow.
At the same time, the image the United States is presenting to global investors is increasingly tainted by our apparent disregard for both economic and diplomatic fundamentals. The message we have conveyed in recent years is that there is no economic problem we confront today -- from gigantic deficits to huge under-funded liabilities -- that we would not prefer to have our children solve tomorrow. So, it should not be surprising that other important measures of investor interest have also taken a dramatic turn for the worse in recent months. Yet our economic leadership seems to be looking the other way. Two weeks after the OECD report came out, Treasury Secretary John Snow told a Cleveland audience, “There is no more serious threat to our economy than the threat of terrorist attacks on our soil.” It is hard to assess the number of ways in which this statement is wrong, but let’s try...More on this story here.
WHO NEEDS AN ISLAND WHEN YOU CAN BUY A HOME ON A LUXURY, GLOBE-TROTTING LINER?
You are wealthy. Seriously wealthy. You own a townhouse, a country retreat, a holiday home and a condominium somewhere hot. Yet you grow tired of all that and cast around for something new. The idea of purchasing your own private island off Dubai briefly appeals but what you really want is variety. What if you could buy outright an apartment in a luxury cruise liner that spends the entire year gliding around the globe? That way, instead of flying off to all points of the compass, the world can come to you.
From the balcony on your new “home”, you could eat breakfast with a view of Sugarloaf Mountain, watch penguins in Antarctica at lunch or sip drinks as the sun sets over St. Mark’s Square. Or count the number of abandoned shopping trollies sticking out of the mud in Deptford Creek. For that was where “The World” anchored on a recent visit to London, dominating the Greenwich skyline as the 43,000-ton, two-year-old vessel sat in the middle of the Thames. It offered a rare opportunity to look around for those who are more likely to fly to the moon than be able to pay the $1 million starting price for the smallest type of apartment on the Bahamas-registered ship. A chance to watch the super-rich at play.More on this story here.
IS POLITICAL CORRECTNESS SETTING US UP FOR A REPEAT OF THE 9/11 HIJACKINGS?
Few documents will have a more searing effect on US security and intelligence operations than the report of the commission on the 11 September attacks. We hope. Almost three years after the hijacks, surely such appalling attacks could not be repeated? Think again. Two reports from the US of disturbing incidents on recent flights suggest that the danger of terror hijack may be as “clear and present” as ever -- certainly in the mind of passengers.
One account describes highly unusual behavior by a group of 14 Middle East passengers on board a Northwest Airlines Flight on 29 June from Detroit to Los Angeles. The movements of the 14, which terrified a number of passengers, suggested an intelligence-gathering operation by terrorists. Other reported incidents on recent flights have included a Middle East passenger being caught in the toilet trying to break through the wall towards the cockpit. These reports come in the wake of a January FBI report that suicide terrorists were plotting to hijack transatlantic planes by smuggling “ready-to-build” bomb kits past airport security and later assembling the explosives in aircraft bathrooms.
While such reports need to be carefully studied and researched, what is also disturbing and not easily dismissed is the flow of corroborative accounts these reports have triggered both from airline passengers and crew. These would seem to suggest that the incident on the video clip showing the 9/11 hijackers passing through security checks to board the plane may not be as historic as we would wish it to be. And the reason for that may have less to do with slack airport security or faulty technology than with legislation forbidding discrimination. This works to prevent effective screening of passengers with certain ethnic backgrounds. Airlines are only allowed to scrutinize intensely two Middle Eastern passengers (or any other ethnic group) per flight, or they can be -- and have been -- sued. Consequently, a group of half-a-dozen Syrians cannot be taken aside by the airline and investigated. We have to ask whether we have a “security” problem in the real sense or a political problem in the reluctance to face the consequences of rigorous enforcement of the Human Rights Act.More on this story here.
MANY U.K. PROPERTY FUNDS ARE HEADING OFFSHORE
More than £100 billion has been invested in UK property funds in the last 10 years. Predictions are that this will continue to grow in 2004, reflecting the strong performance of property as an asset class. A significant number of the large property funds are based in Jersey. In particular, Schroders has some £4 billion of property held through Jersey funds, with a 50-strong property team on the island. Merrill Lynch, Threadneedle Investments and Henderson also have property funds in Jersey, and there are many others. An estimated £17 billion of UK property is held through UK limited partnerships. In the last six months alone, there has been a significant number of these effectively relocating to Jersey.
So what is driving this move offshore? There are a number of factors. First of all, in December 2003 Stamp Duty Land Tax (SDLT) was introduced in the UK. From July this will be extended to cover transfers of interests in partnerships, which are currently exempted. This leaves the prospect of any transfer of an interest in a UK limited partnership being subject to SDLT at the rate of 4 per cent -- not an attractive prospect for institutional investors who may wish to buy and sell such investments. In contrast, transfers of units in Jersey unit trusts are not subject to SDLT, hence putting a Jersey unit trust over the top of a UK limited partnership is an attractive solution and one followed by a number of institutions.
SDLT is by no means the only driving force behind the growth in Jersey property funds. Indeed, Schroders set up its Jersey funds before SDLT existed. The alternative UK vehicles for property funds are authorized and unauthorized unit trusts. The unauthorized unit trust is the preferred UK vehicle. A Jersey unit trust can be offered to both exempt and non-exempt investors without compromising the tax position of the exempt investors -- which is not the case with the UK unauthorized unit trust. At the same time, the Jersey unit trust is transparent for income, distributions can be paid gross, and provided it is managed and controlled offshore, it will be exempt from capital gains tax (CGT). Hence it is an attractive, tax-efficient vehicle. But why have so many of the key fund managers chosen Jersey as opposed to other offshore jurisdictions? Time-zone and ease of access are two factors.More on this story here.
MONETARY AUTHORITY OF SINGAPORE SOUNDS THE ALERT ON INVESTMENT SCAMS
They call you out of the blue and propose sweet investment deals -- financial services firms touting their products. Investors often do not know if it is a sure thing or a setup. But now, the central bank has stepped in to help. The Monetary Authority of Singapore (MAS) has listed on its Web site 25 financial services firms that do not have the proper licences, the first time it has put out such an “investor alert list”. It has also put some advice on the site about how to spot an investment scam.
For example, watch out for sales agents who could be part of “boiler-room” operations, using high-pressure tactics to pitch speculative or non-existent stocks. They call from other countries but by using Singapore-based office services, they fool people into thinking that they are based here and, therefore, under the central bank’s regulations.
The MAS also stressed that being on its list did not necessarily mean that a firm had broken the law. Observers meanwhile noted that with many unregulated investment firms changing their names and addresses frequently, it would be difficult for the list to be fully up to date.More on this story here.
JOHN KERRY’S MONSTROUS RECORD ON CIVIL LIBERTIES
For John Kerry, the specter of Attorney General John Ashcroft trashing Americans’ civil liberties has been a useful campaign prop. In campaign stops, Kerry has promised to “end the era of John Ashcroft and renew our faith in the Constitution.” In a Kerry administration, he promised the liberal group MoveOn in June 2003, “there will be no John Ashcroft trampling on the Bill of Rights.” In his 2004 campaign book, A Call to Service, Kerry accuses Ashcroft and the Bush administration of “relying far too much on extraordinary police powers.” In contrast, Kerry positions himself as a civil libertarian -- or at least as a proponent of a reasonable balance between liberty and security.
Kerry, like every other senator in the chamber except Russell Feingold (D-Wisconsin), voted for the USA PATRIOT Act in the wake of 9/11. Now he is now co-sponsoring the SAFE Act, a bipartisan measure that restricts some of the powers that the PATRIOT Act granted the government. Furthermore, he is critical of the package of proposals from Ashcroft’s Department of Justice (DOJ) that has been dubbed Patriot II. But a close look at his campaign’s statements on the PATRIOT Act reveals that there is less to his opposition than meets the eye. And a look at past positions he has taken reveals still more. He argued for more encryption controls -- Ashcroft was then on the opposing side, along with the ACLU -- when the issue came up under the Clinton administration.
In general, whenever the ACLU was aligned with business interests, Kerry took the side of law enforcement against what he called “big money”. An example is the fight over asset forfeiture. In the 1980s war on drugs, the laws were stretched so that property that had been used for criminal purposes could be seized by law enforcement even if the owner of that property was innocent. In the mid-1990s, a bipartisan movement arose to reform the forfeiture laws, with proposals to increase the burden of proof on the government when it seized property. What was Kerry’s position? He thought U.S. asset forfeiture laws were working so well that he wanted to export them. There was, tellingly, no discussion at all of civil liberties issues. Indeed, the only “dark and dangerous underside” of international forfeiture he identified was the possibility that criminals would give up assets in exchange for avoiding jail sentences.
Kerry is a drug warrior, and after having discovered some genuine instances of bad guys’ stashing their money at the $23 billion BCCI, an international financial institution that was shut down in 1991 by various countries’ bank regulators, he became a crusader against banks holding “dirty money”. Kerry’s solution to money laundering was -- and is -- to deputize banks and force them to spy on all their customers. Kerry expressed his belief that bank customers are entitled to essentially zero privacy. Has a politician who seven years ago proposed all electronic transfers be monitored changed his views on civil liberties?
Kerry’s cosponsoring the SAFE Act, which would limit the circumstances under which “sneak- and-peek” warrants can be issued under the PATRIOT Act, is premised on what he calls Ashcroft’s abuses of the PATRIOT Act, not on PATRIOT itself: “The real problem with the Patriot Act is not the law, but the abuse of the law.” In fact, the “real problem” is the law’s provisions, which would be troubling in any administration. Meanwhile, Kerry continues to support intrusive efforts to stamp out money laundering. His campaign statement points out that Kerry “authored most of the money laundering provisions” in PATRIOT. The money laundering provisions are some of the most privacy-threatening aspects of the bill, and were used by the FBI in the much-criticized Operation G-String, an investigation of a strip club owner in Las Vegas accused of bribing local officials. Tellingly, Kerry -- whose provisions allowed it to happen -- has not cited this operation as one of Ashcroft’s abuses, even though other Democrats have.
We have been told repeatedly that the world has changed since 9/11. Indeed, that is the explanation many have offered for Ashcroft’s change of heart on civil liberties. But what about a candidate who, well before 9/11, consistently advocated measures that would have eroded those liberties? Would he be more or less constrained in the middle of a war on terror?More on this story here.
6TH ANNUAL U.K. BIG BROTHER AWARDS ANNOUNCED
Cars that report your every false move to local law authorities. Huge databases with detailed information on every citizen. Companies that only honor privacy guidelines when it is profitable for them to do so. These were some of the winners of Privacy International’s sixth annual U.K. Big Brother Awards, announced Wednesday. The awards are an annual attempt to publicly name and shame the government and private-sector organizations that have done the most to invade personal privacy in Britain.
The winners of Worst Public Servant, Most Invasive Company, Most Appalling Project, Most Heinous Government Organization and Lifetime Menace were selected by a panel of experts consisting of lawyers, academics, consultants, journalists and civil rights activists. Winners were chosen from roughly 300 people and organizations nominated by the public. They receive a lovely gold statue of a boot stamping on a human head, which is usually mailed to the winners, as none has never shown up to collect its award. Big Brother Awards are now held as an annual event in 17 countries. Each event typically focuses on privacy violations in the host country.
But Privacy International opted to make an exception this year by including in the U.K. awards a U.S. initiative, US-Visit. This security program requires that most foreign visitors traveling to the United States on a visa have their index fingers digitally scanned and a digital photograph taken, so that immigration officers can verify their identity before the visitors are allowed entry into the United States. “The scheme is offensive and invasive, and has been undertaken with little or no debate or scrutiny,” said Simon Davies, director of Privacy International. “Nor has the requirement taken any account of the ‘special relationship’ between the U.K. and the U.S. The U.K. government has been silent about the program and has capitulated every step of the way.”More on this story here.
PENNSYLVANIA COURT WEB SITE EASY PICKINGS FOR ID THIEVES
You probably already know some of the oft-repeated tips for cutting the risk of identity theft, things like do not carry your Social Security card and remember to shred pre-approved credit card applications before throwing them away, to thwart Dumpster-divers. Well, you might want to add this warning to the list: Don’t get involved in a lawsuit. For nearly a year, the Allegheny County prothonotary’s office has been electronically scanning court documents in civil cases, including divorces and child custody cases, and posting them online for public access.
The problem is that many of the files contain potentially sensitive personal data, including birth dates, Social Security numbers, even bank account numbers -- the information ID thieves crave in order to steal people’s identities. The prothonotary’s office believes it is the only court in the state, and one of the few nationwide, that allows unfettered electronic access to court filings, throwing it into the forefront of a debate pitting greater public access against concerns about privacy.
Advocates of electronic access, including the local prothonotary’s office and the news media, defend the practice by pointing out that the court filings being displayed are already public record and can be viewed in hard copy at courthouses. Critics, chiefly consumer privacy groups, argue that since paper filings are relatively difficult and time-consuming to obtain (it requires visiting the courthouse and asking a clerk to retrieve them by case number or name), sensitive personal data is protected by “practical obscurity”. Simply put, electronic access makes viewing court records a whole lot easier, for both the public and ID thieves.
In Allegheny County, anyone can log into the system through the prothonotary’s Web site. It does not take long to figure out which types of cases typically include sensitive personal data. In less than 20 minutes, the Post-Gazette was able to view dozens of documents containing names, addresses, birth dates, Social Security numbers and other confidential information used by ID thieves.More on this story here.
THE POVERTY OF POLITICS
During this past week, once again I have been thankful for not having access to outside television, thus depriving me of that “opportunity” to watch the Democratic National Convention. When the Republicans meet during the last week in August, I will be doubly thankful for my personal choice of deprivation. That does not mean I have been able to escape the inanity in Boston that has been provided by the botox-injection recipients who have been crowding the stage.
In fact, from what the headlines blared as I logged onto the Internet this morning, Edwards had presented John Kerry to the delegates as a practitioner of the “politics of hope”. Thus, I would like to dissect that phrase to demonstrate not only the phoniness of this entire charade, but also the outright poverty of the belief that politics gives us hope.
In the ancient Greek myth of Pandora’s Box, a curious girl named Pandora opened a chest and all sorts of evil sprang from the box, and she could not collect them to put them back. However, Pandora was not finished. She opened the chest once again, and out sprang Hope. Now, in our modern thinking, this second act has been presented as a good thing. The ancient Greeks, however, saw things differently. In their view it was bad enough that Pandora put evil into the world through her blundering, but then she made things even worse by giving us hope -- and we know full-well there is no hope. Therefore hope was not good, but rather an extension of evil, since people forever would be fooled into believing their repeated acts of failure suddenly would morph into something successful. Hope would keep people from recognizing their own folly and the poverty of their own thoughts.
In political terms, hope becomes the engine that permits politicians to foist failed schemes upon people, in the wrong-headed and cynical belief that after a thousand utter failures, a plan of action will prove successful. When the 9/11 Commission released its final report, it supposedly was criticizing government conduct and gave process improvement suggestions in order to prevent future terrorist attacks on Americans. The commission was unwittingly condemning the government itself and the political processes that went with it. In the vernacular, they were trying to rearrange the deck chairs as the Titanic was sinking, an act of absurdity.
Yet, the commission members have “hope”. John Edwards has “hope”. John Kerry has “hope”. The DNC delegates have “hope”. George W. Bush and his minions will tell the nation next month that they will provide “hope”. The political classes have “hope”, but no answers -- because their way of doing things can never provide hope. The welfare-warfare state always will have the same results, no matter who occupies the White House and Congress or sits in the judges’ chambers. For those of us who understand the true poverty of politics, we look elsewhere for answers, and even hope.More on this story here.
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