Democrats are notorious for criticizing Republicans’ support of worldwide American companies who “outsource” (i.e., move operations and workers) to nations like India. While Democrats’ opposition to outsourcing was initially meant to incite sympathy and support from voters on “Main Street”, it has begun to alienate wealthy and influential Indian-American voters, most of whom were previously supporters of Democratic candidates.
Shipping jobs to India has long been a rival issue between Democrats and Republicans. However, Elizabeth Williamson’s Wall Street Journal article entitled “Outsource Attack Ads Alienate Voters Tied to India” provides a new spin to the decade old party battle. According to the article, USINPAC, the chief Indian-American lobbying group who have long funded the Democratic Party, is now contributing money to Republicans to defeat Democratic candidates who criticize so-called outsourcing.
One example of Indian-Americans’ new push for the Republican Party is John Kasich, the GOP challenger to Ohio … Read the rest
In May 2009 American President Barack Obama spoke of how an address in the Cayman Islands housed 12,000 companies. Alluding to the possibility of illegal activity, he noted that this location was either the biggest building in the world or “the largest tax scam in the world.”This image of Offshore Financial Centers (OFCs) as havens for wrongdoing is generally held throughout the world. Recent data indicates that the Cayman Islands holds over 670 billion American Dollars in banking assets from international investors.
Because of such statistics, these small islands are considered a global villain, a haven for illegal capital. According to the OECD Harmful Tax Competition: An Emerging Global Issue (1998 Tax Report) jurisdictions that (a) imposes no or only nominal taxes, (b) lacks policy of effective exchange information, (c) lacks transparency and (d) has no requirement of “substantial activity” is … Read the rest
Microcredit Part 2
Application of Microcredit in the United States
In my last segment, I introduced the concept of microcredit and explained it’s basic foundations. As I explained before, micro-credit is one such way in which stimulating development from below in the societal totem pole also serves to advance democracy and human rights. Now I will put the system into perspective and confront the issues and problems of applying such a system to the United States. The United States in any given year has 10% to 17% living below the poverty threshold as determined by the US Census.  This number translates to about 30-40 million individuals. Furthermore, most Americans (58.5%) will spend at least one year below the poverty line at some point between ages 25 and 75. These statistics seem to suggest that a microcredit system established in the United States would be very successful. … Read the rest
Someone might view the economic crisis times as the best period to broaden one’s business horizons and invest into a new market. The fast growing markets such as China, Brazil, India and to some extent Russia are waiting for new investors. Russia, having more than 140 million inhabitants, i.e. potential consumers, and abundant natural resources remains mostly neglected by investors in many business fields. For decades Russian market was viewed as not a place for those faint-of-heart. Now the growth of political stability and positive developments in legislation make the investment less risky and more attractive. Nevertheless, the still existing differences between local and internationally recognized legislative frameworks and court practices make investors wonder if there is any possibility to opt out of the Russian legal rules.
This article will explore the reasons behind Russian corporate norms that explain the inflexibility of current legislation and court practice and … Read the rest
The Czech Republic is the last of 27 European Union member states left to sign the Lisbon Treaty, also known as the Reform Treaty.  It is anticipated to be ratified by the end of 2009 and go into effect January 1, 2010.  The Treaty is an attempt to amend the two main Treaties that currently govern the European Union (EU),  with qualities very similar to a European constitution.  If the Treaty is ratified, it will dramatically affect the United States’ place on the global stage by strengthening Europe’s economic and political weight.  The Treaty also provides for the development of a common EU defense policy,  which could potentially create an EU military structure similar to the North Atlantic Treaty Organization (NATO), weakening the transatlantic link.  The Obama administration is enthusiastic about this European integration effort,  but many U.S. experts fear … Read the rest
President Obama’s September 11th decision to restrict imports of Chinese tires has sparked a taxing debate both domestically and abroad. On top of the preexisting four percent tariff on all tire imports, the president determined to impose additional ad valorem duties upon certain passenger vehicle and light truck tires from China, designed to taper down from 35 to 30 to 25 percent over three years.  China responded within days by raising a World Trade Organization ("WTO") challenge to the safeguard, alleging that Obama’s actions are inconsistent with existing international laws.  Meanwhile, the proclamation has incited both criticism and praise from a variety of domestic and foreign interests. This article will assess the legality, consequences, and judiciousness of implementing such a tariff and conclude with a word on the free trade versus protectionism debate.
The tire tariffs are in response to a United Steelworkers complaint … Read the rest
Rio de Janeiro will be the first Olympic location in the history of South America. This is the result of Brazil gaining status internationally and integrating to the global market. Apart from sports, globalization has had a great impact on the business transactions and also in the rules enacted in Brazil. An increasing number of international merger companies and nations had switched a red light on the antitrust law regime for merger control that coexists in the many jurisdictions. The different views of antitrust law in each country are important to determine the approach and practical implications of the review systems application. In the merger context, there are significant burdens in international business operations when companies are required to comply with a diversity of procedural requirements in domestic regimes regulations. Over sixty nations have merger notification requirements. Transactional costs are elevated when … Read the rest
The world today is highly technologically advanced in that works of art, literature, designs and other goods are highly digitalized. Whereas in previous generations, trade agreements dealt in hard goods that could be accounted for and of which value was readily determined, the commodities of today are digital and informational. These intangible goods are harder to track and almost impossible to value. As such, the goal of international free trade is being impeded by the reluctance of certain companies to invest overseas either directly in new upcoming firms or through trading of patented information.
Some nations are reluctant to stringently enforce, or even create, laws for the protection of intellectual property rights. These nations argue that protection of intellectual property rights through patents and copyrights would raise market prices to a level near a monopolistic environment. The belief is that an innovative foreign company will not pay royalties … Read the rest
The current global recession has experts around the world searching for a solution in a place never looked to before. For the first time, Asian economies are leading the way out of a global economic slump. While the United States and Europe have pioneered past recoveries from world recessions, recovery seems to have already begun in Asia with China at the forefront. Massive government stimulus and expansionary fiscal policies have spurred growth in Asia with other strong economic indicators seemingly providing a foundation to a full-fledged recovery. Despite a drop in exports, Asian economies have offset the decline in this major source of revenue by slashing interest rates, keeping savings levels high, increasing infrastructure demand and harnessing the potential for expansion in domestic consumer demand. Many Asian nations are net creditors , with significant current account surpluses supplied by capital inflows over … Read the rest
Inspired by the close interaction of law and economics, common law scholars have applied an economic perspective to bear legal problems in the last decades. This scholastic effort has produced interesting results in the United States where the sophistication of the courts and its judges allow a pragmatic application of economic theories to actual controversies. Economists analyze legal rules in terms of efficiency.  Reallocating resources in a society is considered efficient only if that reallocation makes someone better without making some others worse off. 
Economic theory has been broadly applied in the United States, particularly in the area of contract law. At the heart of its application lies the efficient breach hypothesis, a milestone of contract law and the law and economics movement.  Simply put, the hypothesis suggests that promisors should be permitted, if not encouraged, to breach a contract whenever the … Read the rest