Immaculate taxes

From the European Commission's critical letter regarding Ireland's tax treatment of Apple --

According to the excerpt at recital (37), the reduction of the margin after a certain level above USD [60-70] million would have been motivated by employment considerations, which is not a reasoning based on the arm’s length principle. 

Tax decisions that may have involved thinking about job creation -- Eeek!

Gilligan's Peninsula

It's Sunday, so you've a bit more time on your hands.

First read Andrew Gilligan in the Telegraph -- those awful Qataris!

Then read some superb Glenn Greenwald journalism in The Intercept noting how, in the USA, there's a lucrative and well-funded UAE operation to make everyone say -- those awful Qataris!

Gilligan's article follows the template precisely -- citing chapter and verse US Treasury designations that seem damning for Qatar, even though if you know the Syria fundraising beat, it's all being run from Kuwait and the only evidence is that some known Syrian rebel fundraisers from Kuwait and Saudi Arabia visited Qatar to conduct some of their activities there.

Even Gilligan's headline -- Qatar as Club Med for terrorists -- is lifted from an op-ed in the New York Times by the Israeli ambassador to the US, only obliquely acknowledged at the end of the article.

Very important question therefore for Andrew Gilligan: did he rely in any way, in terms of packaged information or financing, on the Camstoll Group* for this article?

*Added: Or other consulting/lobbying firms with contracts from a government entity in the UAE?

UPDATE: Very interesting piece from last year by Alastair Sloan noting some pro-UAE undercurrents to another Gilligan article.

How click bait happens

UAE's female pilot Mariam Al Mansouri 'disowned by her family' screams the Daily Mail headline [no link].  The source turns out to be a Palestinian news site -- funny how they had the scoop on a UAE story -- which in turn is simply a cut and paste from an unvalidated statement issued by people with the same surname. There are a lot of Al Mansouris in the UAE. There's not a shred of evidence in the story that the quotes come from anyone linked Mariam al-Mansouri's family. But that's the speed of the news cycle now. She hasn't even had time to get into a Tom Friedman column and already the media pack want a new narrative.

Fog in Channel

The Heritage Foundation has opinions on quite a few things, and one issue that is getting another run around the block is whether the UK should join the North American Free Trade Agreement (NAFTA). In the old days of the 1990s, this was seen as a stalking horse for getting the UK out of the EU, but with the latter issue now out in the open, it has returned as the solution to what a post-EU UK would do in terms of trade relations. Theodore Bromund and Nile "Churchill bust outrage" Gardiner provide a discussion of the options, and come down in favour of a UK-UK free trade agreement instead of NAFTA membership.

There are various debatable points in the discussion. For example, they note the much higher number of trade agreements that the small European countries outside the EU have been able to negotiate relative to the EU. But that's because small country free trade agreements are relatively easy to negotiate: there's a standard template and not too many vested interests. The world wasn't rocked by the recent Iceland-China free trade agreement -- and neither were Iceland or China.

Perhaps a deeper problem is lurking in one curious omission from the Bromund-Gardiner paper. It never mentions the European Economic Area (EEA). The EEA is an agreement that those aforementioned small European countries, except Switzerland, have signed with the EU. Essentially they agree to take on all of the EU regulations and standards, but without any associated political process. By doing so, they can tap into the free movement principles of the EU.

One major question for a post-EU UK is whether it would join the EEA. Given that the UK is, er, in Europe and is highly integrated with it, it would almost certainly have to. Once it does that, the path to a US-UK free trade agreement is much less obvious: the EEA is fairly intrusive, but at the same time not much of a problem for the UK in terms of adjustment, since it currently complies with all EEA requirements by being in the EU. So which of those intrusive EEA elements would have to go to meet the obligations of a US-UK trade agreement? That's messy, difficult -- and a major part of the reason why the EU decided a long time to handle trade policy at the EU level. Any gains from a US-UK agreement would have to be offset against losses from EEA unwinding -- something that those aforementioned small European nations have not been willing to contemplate.

That new wiser US middle east policy

1980s: Tacitly support the Baathist dictator (Saddam) on the ground that the Islamo-crazies that he's fighting (Iran) are worse

2010s: Tacitly support the Baathist dictator (Assad) on the ground that the Islamo-crazies that he's fighting (ISIS) are worse.

And the current policy really is tacit support for Assad.

That makes it better

A Wall Street Journal processology on how the Arab monarchies were gotten onside for the attack on ISIS in Syria concludes as follows --

The UAE, which some defense officials refer to as "Little Sparta" because of its outsized military strength, had the most robust role. One of the UAE's pilots was a woman. Two of the F-15 pilots were members of the Saudi royal family, including Prince Khaled bin Salman, son of the crown prince. In the third wave of the initial attack, half of the attack airplanes in the sky were from Arab countries.

From beyond the grave

Wall Street Journal editorial --

Now that he has attacked ISIS, Mr. Obama must show that America is the strong horse.

The strong horse is back!  Two questions, with answers from our Iraq warblogging days.

Q. Whose phrase was "strong horse?"
A. Osama bin Laden.

Q. How did its underlying premise of the need for "strength" become pivotal to US policy in the Middle East?
A. Bernard Lewis validated Dick Cheney's already emerging views on that topic.

Return of the Kings

Barack Obama --

We were joined in this action by our friends and partners -- Saudi Arabia, the United Arab Emirates, Jordan, Bahrain, and Qatar. America is proud to stand shoulder to shoulder with these nations on behalf of our common security. The strength of this coalition makes it clear to the world that this is not America’s fight alone. Above all, the people and governments in the Middle East are rejecting ISIL and standing up for the peace and security that the people of the region and the world deserve.

Every Arab country in that coalition is a monarchy.

Here's one map that shows how Putin wants to destroy the Middle East

Itar-Tass News Agency --

MOSCOW, September 22. /ITAR-TASS/. Russia will build a nuclear power plant in Jordan, Russian state-run nuclear corporation Rosatom said on Monday, referring to the agreement between the two countries. The plant to be built in Jordan’s Zarza (sic) province will have two units with a combined capacity of 2,000 megawatts.

You can see Zarqa on the map above. It's the home region of the ISIS OG, Abu Musab al Zarqawi. It's also near Amman, Jerusalem, Beirut, and Damascus, and in general near big chunks of Iraq, Syria, and Saudi Arabia as well as Jordan and Israel.

And Vladimir Putin's state companies are cooking up a scheme to put a nuclear power plant in it. 

Glasgow always said Yes

Thomas Friedman, in the same column linked in the previous post, finds a lesson about immigration in the Scotland referendum result --

One reaction: I’m glad a majority of Scots rejected independence. Had they not, it would have clipped the wing of America’s most important wingman in the world: Britain. Another reaction: God bless America. We have many sources of strength, but today our greatest asset is our pluralism — our “E pluribus unum” — that out of many we’ve made one nation, with all the benefits that come from mixing cultures and all the strengths that come from being able to act together ... This is why America has such an advantage with its pluralism, and why — if Scots are brave enough to preserve theirs, and Spaniards are struggling to keep theirs and Iraqis are groping to find theirs — we should have the wisdom to pass an immigration reform bill that enriches ours.

Note the equation: Scotland on its own = lack of pluralism.

The above photo (BBC) is Glasgow native Peter Capaldi, the current Doctor Who. He was born in Glasgow. His mother was from Cavan and his father from Lazio. And there are lots of Italian-ancestry Scots and even more Irish-ancestry Scots. Scotland has always had immigration. Nor is their indication that an independent Scotland would have a more restrictive immigration policy than the UK -- in all likelihood, it would be less. There's no obvious link between how a nation treats migration and its willingness or lack thereof to be part of a bigger sovereign state.

You can get there from here, but you may not want to

Thomas Friedman in the New York Times --

It’s no accident that the two democratizing Middle East entities doing best today are Tunisia and Kurdistan. Neither has fully mastered pluralism yet, but they’ve mastered its necessary precursor for self-governance, which was the principle used in 1989 to settle the Lebanese civil war: “No victor, no vanquished” among the major players. Everyone’s interests have to be balanced. Iraq is now struggling to get there; Syria is not even close ... In Syria and Iraq today, you have neither citizens nor states, but rather clans, sects and tribes, which now need to reorganize themselves into voluntary states, as opposed to those imposed by colonial powers, so they can be real citizens.

Is Lebanon the benchmark, or isn't it? In his first segment, how the civil war ended, it is a benchmark. In the second segment, he says Iraq and Syria's problem is that it is organized by clan, sect, and tribe, and not state.

But organization by clan, sect, and tribe is a very accurate description of Lebanon today, 25 years after its civil war formally ended. 

Blind spot

You'd never know it from the amount of media coverage it generates, but the country facing the biggest Syrian hostage crisis now is not the USA, UK, or Turkey. It's Lebanon, the country least able to handle the internal tensions that these crises create.

Scotland musical selection

Since everyone seems to have a song in mind for independence referendum day.

They've promised not to tell him the juicy stuff

It's odd that this didn't get more attention. A major plank of the White House strategy on ISIS is that while they'll be giving all sorts of support to Iraq to defeat ISIS, they absolutely will not be doing anything that would help that awful man Bashar al-Assad in Syria.

The above is the Iraqi National Security Adviser in Damascus yesterday explaining to a cheerful Bashar al-Assad all the things that Iraq will be doing to to defeat ISIS -- with the help of the White House strategy.

Photo: Syrian Arab News Agency, via Reuters.

That's a pretty big matzoh ball hanging out there

From the otherwise unqualified condemnation of terrorism issued by senior religious scholars in Saudi Arabia (via Saudi Press Agency) --

It said that due to acts of terrorism committed by some groups, such as: Daash (ISIS), and al-Qaeda, so-called Ahl Al-Haq groups, Hezbollah and the Houthis, or crimes of terrorism practiced by the Israeli occupation, or criminal acts practiced by some groups affiliated to Islam, they are all forbidden and criminalized, because of their attack on the sanctities of lives, funds, security and stability, noting that it is the biggest crime to frighten Muslims and residents.

Last in first out

In Scottish #indyref week, a quote from the oft-quoted Adam Smith (Wealth of Nations, Book V, Chapter 3) --

By a union with Great Britain, Ireland would gain, besides the freedom of trade, other advantages much more important, and which would much more than compensate any increase of taxes that might accompany that union. By the union with England the middling and inferior ranks of people in Scotland gained a complete deliverance from the power of an aristocracy which had always before oppressed them. By a union with Great Britain the greater part of the people of all ranks in Ireland would gain an equally complete deliverance from a much more oppressive aristocracy; an aristocracy not founded, like that of Scotland, in the natural and respectable distinctions of birth and fortune, but in the most odious of all distinctions, those of religious and political prejudices; distinctions which, more than any other, animate both the insolence of the oppressors and the hatred and indignation of the oppressed, and which commonly render the inhabitants of the same country more hostile to one another than those of different countries ever are. Without a union with Great Britain the inhabitants of Ireland are not likely for many ages to consider themselves as one people.

[Previously in this series]

The winner doesn't take it all

At Vox, Matthew Yglesias hails the Swedish election result as an example of how bad monetary policy can be costly to incumbents --

Both Sweden's early success and its later failure can probably be laid at the feet of monetary policy, rather than anything [PM] Reinfeldt did per se ... But from late 2011 onward, the Riksbank [Swedish central bank] insisted on moving toward tighter money despite high unemployment and low inflation. The stated reason for this, which has also had some influence inside the Fed, was that the bank had to act to prevent "instability" in the financial system. As Lars EO Svensson, a Princeton economist who worked at the Riksbank during the crisis years but lost the argument about post-crisis tightening, explains in this great presentation this has proven to be an extraordinarily costly way of obtaining uncertain benefits. And now it's likely going to cost the governing coalition their jobs.

Here's a Reuters account of the election aftermath in terms of its dynamics --

Under Reinfeldt Sweden lost much of its image as a socialist welfare state. The country's tax burden fell 4 percentage points, to 45 percent of GDP, under France's. Taxes on inheritance and wealth were lowered or abolished. More Michelin star restaurants than ever opened in Stockholm. "These have been fantastic years where the Alliance have taken responsibility for Sweden," Reinfeldt told party supporters on announcing his resignation. "My hope is that the journey will continue, but it will be without my participation." Many Swedes are worried that reforms under Reinfeldt have gone too far, weakening healthcare, allowing business to profit from schools at the expense of results and dividing a nation that has prided itself on equality into haves and have-nots. Voters have been shocked by scandals over privately run state welfare - including one case where carers at a home for the elderly were reportedly weighing diapers to save money - and bankruptcies of privately run schools ... Widely admired for its triple A-rated economy, stable government and liberal attitude to immigration, Sweden nevertheless faces significant challenges, which a weak government will struggle to deal with. Unemployment is high at 8 percent, hitting immigrants and young people especially, and a potential housing bubble threatens economic stability. Widespread riots last year in Stockholm's poor immigrant suburbs highlighted a growing underclass in Sweden, which has had the fastest-growing inequality of any OECD nation. The rise of the far right points to a society starting to question its role as what Reinfeldt calls "a humanitarian superpower". The number of asylum seekers from countries like Syria is expected to reach 80,000 this year. Even Reinfeldt has said government finances would be strained due to the cost of new arrivals. They were figures that played into the hands of the far right.

That list is much more about quality of public services, the perception of tax-cutting zeal, lack of public harmony with migration policy, and the ability of the far right to capitalize on the Syrian refugee influx. Monetary policy surfaces only obliquely (high unemployment among selected groups, but also very high housing prices).  The loss for the centre right is therefore an awkward narrative in which they suffered both from supply side obsession but also humanitarian policies that journalists like Matthew Yglesias would presumably favour (we're all for taking more Syrian refugees than bombing it, right?). In any event, monetary policy looks like an externally imposed narrative looking for one decisive factor that be blended into a broader EU story, even for a country not in the Euro.

Especially New Provo Front, Liberté de Quebec, and Asian Dawn

John Kerry in Cairo, calming everyone down --

The fact is that in today’s globalized world, it’s only a matter of time before the threat of terrorism anywhere becomes a threat of terrorism everywhere.

Being voted off the island

Ian Paisley in the House of Commons, 2 July 1979; it reads especially interestingly in light of the Scottish referendum --

No one in Northern Ireland who takes the name of Unionist wants to jeopardise the Union or interfere with it, but let it also be said that the people of Northern Ireland are sick and sore at heart when it is suggested in this House and elsewhere that they are citizens of the kingdom only by a charitable act of this House. It would be far better for the House to grasp the nettle. I put again to the House what I have put on two previous occasions. If the people of Scotland, England and Wales have decided that Northern Ireland should no longer be part of the family, let the nation be tested on that issue. I see in this House a great connivance to run away from the ballot box—to say what is good for the people of Northern Ireland but never to test it. Let the United Kingdom, apart from Ulster, be tested on that issue. Let the people speak. Let us have a verdict from the nation. I say with Kipling that if we are driven forth we must seek our destiny elsewhere ... The idea that as long as the majority of people of Northern Ireland want to be part of the United Kingdom all is well is a farce. I voted against that in this House, as did others. What would happen if there were a vote on this question, and there was a majority of one for going into the Irish Republic? We all know what would happen. That is only an exercise to put off the real issue. The House, the Government and the Labour Opposition should be prepared to grasp 1040 the nettle. It they do not want the Ulster people as part of the United Kingdom they have no right to say so; they must let the people say it. 

[Previously in this series]

Turning and turning in the widening crash

New York Times Ireland advertorial, 11 September 2014.

Non-expert non-bipartisan non-elite Obama speech reaction

There were at least two people who spent the Obama ISIS speech splitting their sides laughing. Those two people are Abu Bakr al-Baghdadi, and Bashar al-Assad.

On what was is September 11 in most of the world, Abu Bakr al-Baghdadi watched his organization be declared the new Islamic super bad guys whom America would have to go after. What better validation as the new Osama bin Laden could an aspiring bad guy ask for?

Then there's Bashar al-Assad. He learned that there will be US airstrikes against ISIS in Syria -- supposedly counterbalanced by support to the moderate Syrian opposition. But whereas airstrikes can happen at the click of a button, that support (now announced for the 4th time) will occur through layers of approvals and intermediaries. In other words, it's a lot less potent than air strikes. So al-Assad knows that his most dangerous foe is being attacked, with no counterweight, and he can go on television and complain that if only Syrians would unite behind him, he could deter the American aggressor.

The speech also contained a jarring transition from recounting of the toll of the new super bad guys to how well the economy is doing. Beheadings are up -- but so are the jobs numbers!

Finally, the Iraqi and Syrian people were told that, Inshallah, they'll be like Yemen and Somalia. We know those Google searches can be overwhelming, but did anyone at the White House at least narrow the Yemen search to recent news?

Better late than never

Josh Marshall --

Very Good Questions Has the world been bamboozled by the ISIS PR machine?

The link is to an AP story noting the effectiveness of ISIS exaggeration in making them seem more powerful than they actually are.

So who are these gullible media types who've been making ISIS seem all-conquering?

Here's Josh Marshall approvingly quoting an expert reader e-mail --

Why is ISIL so successful? Simply put they attack using simple combined arms but they hold two force multipliers – suicide bombers and a psychological force multiplier called TSV – Terror Shock Value. TSV is the projected belief (or reality) that the terror force that you are opposing will do anything to defeat you and once defeated will do the same to your family, friends and countrymen. TSV for ISIL is the belief that they will blow themselves up, they will capture and decapitate you and desecrate your body because they are invincible with what the Pakistanis call Jusbah E Jihad “Blood Lust for Jihad”. I have worked the Iraq mission since 1987 and lived in and out of Iraq since 2003. TSV was Saddam’s most effective tool and there is some innate characteristic of the Iraqis that immobilizes them when faced with a vicious, assuredly deadly foe who will do exactly as they have done to others – and they will unsuccessfully try to bargain their way out of death by capitulating.

Convenient Surprise

White House memo ahead of the President's speech tonight--

By the authority vested in me as President by the Constitution and the laws of the United States of America, including section 301 of title 3, United States Code, I hereby delegate to the Secretary of State the authority under section 506(a)(1) of the Foreign Assistance Act of 1961 to direct the drawdown of up to $25 million in defense articles and services of the Department of Defense and military education and training to provide immediate military assistance to the Government of Iraq, including the Kurdistan Regional Government, to aid their efforts to combat the Islamic State of Iraq and the Levant and to make the determinations required under such section to direct such a drawdown.

The relevant clause of the Foreign Assistance Act of 1961 states "an unforeseen emergency exists which requires immediate military assistance to a foreign country."

The ISIL insurgency in northern Iraq was unforeseen?

It's PNAC 2.0

The New York Times and the White House combine on some expert trolling of war skeptics --

WASHINGTON — In an effort to win over elite opinion before a speech to the nation this week on Iraq and Syria, President Obama played host at a White House dinner on Monday evening for a bipartisan group of prominent foreign policy experts.

If the ISIS war has been vetted by Prominent Elite Bipartisan Experts (PEBE), what would possibly go wrong?

Is the Mufti Muslim?

It's strange what gets considered news. When the Pope -- entirely consistent with Catholic doctrine -- said military action against ISIS could be justified -- there was much Counterintuitive! excitement. When the Grand Mufti of Saudi Arabia says --

“This group (ISIS) is wrong, not right, and if they fight Muslims, it is the duty of Muslims to fight them back to ward off their evil and keep it away from religion and people,”

Nobody notices.As with so much about ISIS media coverage, doesn't fit the narrative.

Be careful for what you wish for

President Obama during his Chuck Todd inception interview on NBC's Meet the Press

Well, I think that it is absolutely true that we're going to need Sunni states to step up-- not just Saudi Arabia, our partners like Jordan, United Arab Emirates, Turkey. They need to be involved. This is their neighborhood. The dangers that are posed-- are-- are more directed at them right now than they are us.

It's little over a week ago that UAE jets used Egyptian bases to attack Islamist militias in Libya.

The problem in the Middle East is not people not "stepping up." They'll step up just fine if they see a vacuum. And the implications of Turkey -- a NATO member -- stepping up would be particularly large.

Strongman Forum

From a letter sent by Vladimir Putin to the presumed outgoing Iraqi Prime Minister Nouri al-Maliki, who everyone had seemingly agreed need to go to support an inclusive government in Baghdad --

I am confident that you will continue your work in order to strengthen the state in Iraq and expanding the ties of friendship between our two countries.

Not showing at the Theatre of Dreams

The New York Times quotes Fox Sports USA executive vice president for soccer Jonty Whitehead on their new Multimatch 90 channel which will hop around parallel UEFA Champions League matches --

“This is, after all, where the best soccer players in the world turn out,” Whitehead said. “Bale. Wayne Rooney. Ronaldo. Robin van Persie. The list is endless, and we get to see what they do best.”

There's just one problem. Wayne Rooney and Robin van Persie play for Manchester United, which did not qualify for the Champions League this season.

19th province and 20th century

Robert Kagan, in a Wall Street Journal surely headed to the top of Barack Obama's reading pile on war reluctance--

For a time in the 1990s, while the generations of World War II and the early Cold War survived, the old lessons still guided policy. President George H.W. Bush and his national security adviser, Brent Scowcroft, sent half a million American troops to fight thousands of miles away for no other reason than to thwart aggression and restore a desert kingdom that had been invaded by its tyrant neighbor. Kuwait enjoyed no security guarantee with the U.S.; the oil wells on its lands would have been equally available to the West if operated by Iraq; and the 30-year-old emirate ruled by the al-Sabah family had less claim to sovereign nationhood than Ukraine has today. Nevertheless, as Mr. Bush later recalled, "I wanted no appeasement." 

A little more than a decade later, however, the U.S. is a changed country.

Saddam Hussein invaded Kuwait in 1990, and Operation Desert Storm evicted him in early 1991. That's 23 years ago. That's a lot more than a decade ago.

Is some of the weirdness of conservatism simply a matter of a different sense of the passage of time?

With our combined strength, we can end this destructive conflict and bring order to the galaxy

Vox home page today (Goldman Sachs and Energy!).

Islamic Magnetic Pulse

One segment on Greta Van Susteren's Fox News show this evening, linked to the latest ISIS beheading, featured terrorism expert William Forstchen discussing the threat that ISIS could pose to the US homeland. He cited his book Day of Wrath, which was prominently plugged in the segment. The book was claimed to describe a "scenario" in which ISIS launches an attack on US soil.

His prolific output as a historian and technology expert -- not mentioned in the segment set-up -- consists recently of books of historical fiction, several co-authored with Newt Gingrich. He also had a spell of prominence from another book which portrayed societal breakdown in the wake of an electromagnetic pulse (EMP) attack.

Anyway, the punchline of his new scenario, which necessitates war to eliminate ISIS, is that America has a lot of soft targets like churches, schools, and synagogues that ISIS could attack. Apparently a crazy Islamic guy could show up at a school and kill lots of people. Frightening!

Fashion Jihadi

In the House of Commons today, David Cameron laid out the need for new powers to deal with British citizens committing terrorist atrocities in Syria (BBC) --

Under his proposals, UK nationals suspected of being involved in terror acts would be allowed to keep their British citizenship, but they would be prevented from re-entering the UK for a period of time. He added: "Adhering to British values is not an option or a choice. It is a duty for all those who live in these islands so we will stand up for our values, we will in the end defeat this extremism and we will secure our way of life for generations to come."

This blog is pleased to reveal the exclusive must-credit results of an in-depth investigation of one particular British citizen linked to numerous outrages in Syria, including chemical weapons, barrel bombs, indiscriminate attacks on civilian targets and industrial-scale torture. The name and address of this affront to British values but holder of British citizenship is:

Asma Al-Assad
Presidential Palace
Damascus
Syria.