A few things from various digests:
Brad wrote:
>Gee. When my chairs and deans talk to me about what I'm
>doing, there
>is no implication that my tenure appointment was a
>mistake: it's a
>normal part of the process.
Which I'm sure is true, but on the other hand (and I realise that at least part of what you're doing here is sticking up for a mate, which I'd be the last to condemn), Larry Summers has a worldwide reputation for being able to make "Happy Birthday" sound like "Your mother's a whore". Nobody would call him affable ...
Doug wrote:
>Which just goes to show you that when you're writing
>counterhegemonically, you have to be at least 7.842 times
>as careful
>as someone doing PR for The Man.
Alternatively, it shows that when you're dealing with the kind of person who glues fifty pence pieces to the pavement, there's no point in wasting too much time crossing and dotting the right letters, because if someone like that wants to get you, they're going to get you.
and finally:
On the question of the returns on LDC investment, I think Michael Perelman had it right; transfer pricing is the key and the statistics are likely to be of very low quality. If you think yourself into the position of the tax planner for a company with a maquilador subsidiary, it's not difficult to see how. You have a local entity (either a branch or a subsidiary) which only has one customer, (the head office). Therefore, the price at which the maquilador sells its output to head office determines its profitability. Why on earth would you chooseto set that price at a level which left the maquiador with a positive profit? If it makes zero profit, then the actual return on investment is brought into head office, where the tax planners can make use of all the techniques they have at their disposal to reduce or postpone any taxable events. On the other hand, if you leave profits in the maquilador, then the very best thing that can happen is that the overseas jurisdiction has a lower rate of tax than the USA, in which case you end up paying tax on the difference to Uncle Sam. In anything other than bizarre tax circumstances (ie, tax havens), there is significant incentive to take the profits in head office. That's without considering the fact that if you don't have retained profits overseas, you don't have to worry about overseas dividend taxation or the danger of capital controls.
Everyone should read "The Bluffer's Guide to Tax". It only costs $6.50, it will only take a morning to read and it really is a fantastic little book. It tells you everything you need to know about big-ticket tax planning in a reasonably amusing manner, and it isn't dumbed down. Here's a link to buy it:
http://www.amazon.com/exec/obidos/ASIN/086091495X/leftbusinessobseA/
dd
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