A flat tax is what a flat world needs!

Sir much as I wholeheartedly agree with the intentions that John Christensen and David Spencer express in their "Stop this timidity in ending tax haven abuse" March 4, and that establishing a network of bilateral tax agreements will not be sufficient to solve the problem of world wide tax evasion, I do not believe that what they propose in terms of shifting the focus "towards the infrastructure of cross-border economic crime, including accountants, lawyers and financial institutions" will cut it either. On the contrary we could just be opening up new growth opportunities for those many illegal and illicit organizations that thrive so much on all our prohibitions.

What I would suggest is to go instead for a real worldwide tax transparency by making all countries sign up on an easy to understand world wide flat tax. This would help to remove the incentives to geographically arbitrate taxes and that keeps so many accountants, lawyers and financial institutions in the business "legal and intelligent tax avoidance"; and that keeps so many governments from not knowing whether they are giving true and needed tax incentives to attract investments or just being taken for a ride.

In all, a flat tax is precisely what a flat world needs; and by the way, just in case, a flat tax can be construed as a progressive tax too.

Liberty and security also requires consensus

Sir, although Willem Buiter might be fundamentally correct when he says “For the sake of liberty and security: legalise all drugs” August 8, he should also remember that for the sake of that same liberty and security he needs to frame his idea in such a way that it is acceptable for the majority. 

In this respect and making reference to Moisés Naim’s interesting book “Illicit: How Smugglers, Traffickers and Copycats are Hijacking the Global Economy”, (2005) and that reminded us of how much of the illegal world was interconnected, perhaps a more consensus reaching approach could be to identify the whole world market of illicit and legalize it at a rate of 5 per cent a year starting with the more digestible. 

Otherwise they way the world is going its illicit part is soon going to be wealthier and stronger than the licit… and that is more dangerous than hundred al-Qaeda put together. Also while discussing these issues let us never forget that strict social sanctioning is normally a far more efficient route to go than the strictest of the law enforcements.

Sometimes the original and the pirated copies are just each other's parasites

Sir, Hugh Williamson reported May 8 that “Counterfeiting losses are less than claimed, says OECD” and mentioned that the upcoming results of some studies could prove embarrassing to some international business lobbies which have used high estimates to further their causes. I looked further into the details of such studies and found worrisome that OECD seems to put counterfeiting and piracy in the same sack of problems, where they do not belong.

A counterfeit is an imitation made with the intent to deceptively represent its content or origins. This is not only clear criminal behaviour but besides the direct costs, implies often great dangers, as for instance in the case of falsified medicine.

Piracy, the copying of a trademark or patent covered product to be sold at so much lower prices that no one could think of deceit, is comparatively speaking more of a venial sin, and about which we need more debate before declaring it so illegal that it should be hounded down, at any cost, and as a consequence increase the growth potential for those in the society that are dedicated to criminal and illicit activities.

Just as an example let me ask you the following: What is worth more, an original Vuitton handbag in a ladies lunch where all the ladies carry Vuitton, Gucci, Prada or Hermes Birkin (my daughter’s favourite, she is now looking at a pre-owned simple hand bag going for $9750) or that same handbag in a ladies lunch where all other ladies use pirated Vuitton bags. Exactly! The worth of the original is increased by the willingness of people to use cheaper copies of it. And in this respect the $900 dollar bags has nothing to do with the $20 dollar copy except as mutual parasites. You would never ever be able to sell the true bag at $900 were it not for the $20 dollar fakes, and also less of the $20 dollar fakes without the $900 original.

I have written a great book, Voice and Noise, and that is slowly turning itself into a collector’s item on account of so few reading it. I would love to have it pirated, if that would help me to reach thousands of readers. Any willing pirates out there? Then I could easily have my original retail for $190.