Politics & Economics · Politics & Viewpoints from Political Parties · Tariffs

Republican, Democrat, & Libertarian views: “Should Trump impose a 35% tariff on the importation of Mexican/Chinese products?”

tariff concept

December 6, 2016

SHOULD TRUMP IMPOSE A 35% TARIFF ON THE IMPORTATION OF CHINESE/MEXICAN PRODUCTS?

This question came up while I was at a dinner party. The only conversation I had prior to this was when I had briefly discussed it with my husband during the political elections. However, it was not something I knew much about nor had the opportunity to research extensively. My first reaction to this question was if a 35% tariff was placed on the importation of foreign products, wouldn’t that increase the prices for consumers? How is that going to effect me?  It also made me think about the importance of transition and timing. Is this going to be something done gradually to allow corporations to prepare? If this is done too fast, couldn’t it result in putting corporations that use foreign labor out of business? Again, let me reiterate I hardly know anything on tariffs so if these questions seem misplaced that might be why. Needless to say, I was not much of a contributor at the dinner party. 

Following the dinner party, I decided to go to wikipedia to research the history on Tariffs. I learned tariffs have played important roles in trade policy, political debates and the nation’s economic history. Something I found interesting was the retaliatory effects high tariffs have caused in the past. If history repeats itself then will China & Mexico retaliate against us? Some Republicans who are not in favor of a 35% import tariff  fear it leading into possible trade wars. Others Republicans argue the answer to building the economy again is in tax reform and deregulation versus tariffs and trade wars. Additionally, I  ask the question will high tariff’s favor manufacturing interests or consumer interests?

I released this question to the public to gain more of an understanding & received  great responses from 2 highly accomplished professionals — one a liberal & the other a libertarian. I also welcome anyone to comment on this blog who can provide additional insight. 

  • LeslieLawyer,JD

 

A LIBERAL view by Eli Baumwell

My answer, and I assume the answer of most, but not all liberals, would be “no.” However, the liberal perspective on this issue is nuanced.  So I want to explore the philosophical and political, and practical reasons for this response.

Philosophically, liberals should be more at ease with high tariffs.  Modern American liberalism has traditionally taken a more interventionist approach to the market.  Certainly, tariffs designed to protect employment and insulate the domestic market from the volatilities of the wider world – even at the risk of higher prices –   are consistent with the Keynesian values that defined American liberalism for most of the 20th century.  

Trade, has been, an interesting counterexample to this philosophy.  Particularly since fall of the Soviet Union, mainstream liberals have adopted into this plank of the neoliberal, Washington Consensus, platform.  There have been multiple reasons for this buy-in.  Some focus on growth and the notion that “a rising tide lifts all ships”.  Others saw trade as a way to raise wagess by allowing low-wage, low-skill jobs to go overseas, opening up higher-paying jobs domestically.  Some looked to the European Common Market and saw virtually non-existent trade barriers, and a strong social safety net.  Some saw increased market cooperation as an opportunity to expand labor and environmental protections.  Others saw trade as a tool in international diplomacy and a way to spread peace, prosperity, and democracy.  

There can be no denying that the last 20 years; the era of disappearing trade barriers and globalism has dramatically reshaped the world, sometimes for the better, sometimes – not.  Whether the net effect has been benefit or harm depends on what markers you are looking at, and through what lens.  Liberal response has varied.  There are those who claim the net effect is positive, and the negative effects are nothing more to systemic costs.  Others recognize trade liberalization has not lived up to its promise, but feel the problem is bad policies within the paradigm.  Other liberals, particularly from the far left, and typified by Bernie Sanders have argued that the free-trade paradigm was flawed from the beginning and is, at its core a tool to further entrench and grow the power and wealth of the global elite, at the cost of the working class.

Looking at the practical implications of a 35% tariff, most economists predict significant job decrease, wage stagnation, inflation and/or recession.  However, there are economists, from all along the political spectrum, that have opined that the effects may be less dramatic, and may actually result in more jobs or higher wages.  Aside from the economics, some have argued that high tariffs could be used to reinvest in decaying infrastructure – a return to the American System that helped drive rapid growth and development in the 19th century.  Finally, there are international considerations.  At best, this tariffs strains diplomatic relations.  At worst, it results in retaliatory trade barriers on American goods, slower growth internationally, and potentially, a trade war.

So where does that leave liberals?  Philosophically, they favor market intervention, but also favor trade.  Politically, liberals are split on the approach to trade.  And practically, prognosticators differ wildly in predictions.  Ultimately, between optimism that more open-trade can still be beneficial, especially with policies that focus more on workers rights and protections for displaced labor, the very significant risks of increasing trade barriers, and the liberal ideal of cooperation and collaboration, the tariff proposals are likely to be opposed.  

Eli Baumwell is policy director for the ACLU of WV.  He studied Government with a concentration in International Relations at Cornell University, and earned a JD and a Master of Public and International Affairs with a major in International Political Economy from the University of Pittsburgh. Politically, he is somewhere between a progressive idealist and a liberal elite pragmatist.

 

A LIBERTARIAN view by Robert W. McGee

The short answer is NO. But there are two reasons why the answer is no.

THE UTILITARIAN ETHICS ANSWER: Just about all studies conducted by unbiased economists have found that trade restrictions are negative-sum games, meaning there are more losers than winners, or the total losses exceed the total gains. For every job saved, two or three jobs are destroyed, depending on the study and the underlying assumptions. Tariffs are one form of trade restriction. Various studies have found that tariffs result in negative-sum games. See below for various studies and articles that elaborate on this point.

Donald Trump has proposed imposing a tariff of 35% on the importation of certain products from China and Mexico. The first question to be asked is, “Who ultimately pays these tariffs?” The answer is American consumers.

But that is not the end of the story. Even people who do not purchase those Chinese and Mexican products are worse off as a result of the tariff. That’s because a 35% tariff on the importation of foreign goods allows American producers to raise their prices. If they raise their prices by anything less than 35%, they will gain market share. American consumers who purchase American products will have to pay these higher prices. Tariffs are a form of corporate welfare because they benefit domestic producers. American producers that pressure the government to impose tariffs on foreign producers are engaged in what economists call rent-seeking, which can be defined as feathering your own nest at the expense of the general public.

 

THE RIGHTS ANSWER: The answer is the same if one applies rights theory. President Trump should not impose a 35% tariff on the importation of certain Chinese or Mexican products because it violates rights – the property and contract rights of both the buyers (American consumers) and sellers (the Chinese and Mexican producers).

In a truly free trade regime, consumers should be free to trade what they have (cash) for what they want without government interference. If a 35% tariff is imposed, it is likely that many Chinese and Mexican products will be shut out of the U.S. market. Their price will become prohibitively high. American consumers will no longer even have the option of purchasing these products because they will never even cross the border. If they are able to cross the border, American consumers will have to pay more to obtain them.

The only trade policy that does not violate property rights is a policy of unilateral free trade. That means no tariffs, no quotas, no punishment for selling at a price that is deemed unacceptable by some bureaucrat in Washington, no protectionist schemes like domestic content laws, and no other restrictions on trade. If consenting adults and the corporations that represent them can trade what they have for what they want without government interference, no one’s rights are violated. In all other cases, rights are violated, which is unacceptable.

 

BIO

Robert W. McGee holds 13 doctorates from universities in the United States and four European countries. Before becoming a novelist he was an attorney, CPA, professor and consultant. He has won 4 silver and 2 bronze medals at Martial Arts World Championship tournaments. You may read about his novels at http://robertwmcgee.com. You can download more than 400 of his scholarly papers here. http://ssrn.com/author=2139.

TRADE BIBLIOGRAPHY

 

Baumanis, Leilani O. and Robert W. McGee. 2009. The Economic, Ethical and Cultural Effects of International Outsourcing, in Readings in Business Ethics. Hyderabad, India: ICFAI University Press, pp. 77-91. http://ssrn.com/abstract=1078023

 

Block, Walter, Robert W. McGee and Kristi Spissinger. 1999. No Policy Is Good Policy: A Radical Proposal for U.S. Industrial Policy, Glendale Law Review 17(1): 47-58. http://ssrn.com/abstract=115075

 

Block, Walter, Robert W. McGee and Yeomin Yoon. 2002. Rethinking the Antidumping Laws and Policies with Reference to East Asian Trading Partners of the U.S. (China, Japan and Korea). International Trade & Finance Association, held in conjunction with the Allied Social Science Association (ASSA) Annual Meeting, Atlanta, January. http://ssrn.com/abstract=2858442

 

Desai, Renu and Robert W. McGee. 2010. Is Outsourced Data Secure? The CPA Journal 80(1): 56-59, January. http://ssrn.com/abstract=2858460

 

Desai, Renu and Robert W. McGee. 2010. The Sarbanes-Oxley Act: Deterrent or Aid to Finance and Accounting Outsourcing? Currents: International Trade Law Journal, Summer, 18(2), 22-29. http://ssrn.com/abstract=1517223

 

McGee, Robert W. 1989. “The Trade Deficit Mentality: An Accounting and Philosophical Analysis,” The Mid-Atlantic Journal of Business 25(6): 67-81. http://ssrn.com/abstract=2848069

 

McGee, Robert W. 1989. “The Protectionist Mentality: An Accounting and Philosophical Analysis — Part I,” The Mid-Atlantic Journal of Business 25(7): 63-83. http://ssrn.com/abstract=2848052

 

McGee, Robert W. 1989. The Protectionist Mentality: An Accounting and Philosophical Analysis — Part II, The Mid-Atlantic Journal of Business 26(1): 81-104. http://ssrn.com/abstract=2848087

 

McGee, Robert W. 1990. The Trade Policy of a Free Society, Capital University Law Review 19(2): 301-41. Reprinted in Prace Z Zakresu Ekonomii Politycznej I Historii Mysli Ekonomicznej (Works on Political Economy and the History of Economic Thought), Akademia Ekonomiczna W Krakowie Zeszyty Naukowe Nr. 389 (Cracow Academy of Economics Scientific Book Number 389), Cracow, Poland: Cracow Academy of Economics, 1992, pp. 87-127. http://ssrn.com/abstract=2848054

 

McGee, Robert W. 1990. The Cost of Protectionism, The Asian Economic Review 32(3): 347-64. For a different paper on the same topic, see http://ssrn.com/abstract=2858509

 

McGee, Robert W. 1991. The Trade Policy of the Free Society, Cracow Academy of Economics, Poland, April. http://ssrn.com/abstract=2848054

 

McGee, Robert W. 1992. Trade Deficits and Economic Policy: A Law and Economics Analysis, Journal of Law and Commerce 11(2): 159-174. http://ssrn.com/abstract=2859145

 

McGee, Robert W. 1992. How Free Should Trade Be? Rector’s Lectures No. 10, Cracow Academy of Economics (Poland), 25 pages.

 

McGee, Robert W. 1992. The Trade Policy of a Free Society,” in Prace Z Zakresu Ekonomii Politycznej I Historii Mysli Ekonomicznej (Works on Political Economy and the History of Economic Thought), Akademia Ekonomiczna W Krakowie Zeszyty Naukowe Nr. 389 (Cracow Academy of Economics Scientific Book Number 389), Cracow, Poland: Cracow Academy of Economics, pp. 87-127. http://ssrn.com/abstract=2848054

 

McGee, Robert W. 1993. The Case to Repeal the Antidumping Laws, Northwestern Journal of International Law & Business 13(3): 491-562. http://ssrn.com/abstract=2858524

 

McGee, Robert W. 1993. The Cost of Protectionism: Should the Law Favor Producers or Consumers? Georgia Journal of International and Comparative Law 23(3): 529-57. http://ssrn.com/abstract=2858509

 

McGee, Robert W. 1993. An Economic Analysis of Protectionism in the United States with Implications for International Trade in Europe, The George Washington Journal of International Law and Economics 26(3): 539-573. http://ssrn.com/abstract=2858365

 

McGee, Robert W. and Yuhua An. 1994. The Development and Performance of American Antidumping Laws, Customs Study Conference, University of International Business and Economics, Beijing, China, June. In Chinese.

 

McGee, Robert W. and Yeomin Yoon. 1994. Technical Flaws in the Application of the U.S. Antidumping Laws: The Experience of U.S.-Korean Trade, University of Pennsylvania Journal of International Business Law 15(2): 259-297. http://ssrn.com/abstract=2858550

 

McGee, Robert W. 1994. Business in the Global Community, The Freeman 44(7): 377-379. http://ssrn.com/abstract=2858395

 

McGee, Robert W. 1994. A Trade Policy for Free Societies: The Case Against Protectionism, Quorum Books.

 

McGee, Robert W. and Yeomin Yoon. 1994. Trade Policy for the Computer Industry: Time for a Change, Temple International and Comparative Law Journal 8(2): 219-256. http://ssrn.com/abstract=91270

 

McGee, Robert W. 1994. U.S. Trade Policy Toward Malaysia and Thailand: Recent Case Studies, ASEAN-US Relations Symposium, University of Central Oklahoma, November 2. http://ssrn.com/abstract=91189

 

McGee, Robert W. 1994. U.S. Trade Policy Toward Malaysia and Thailand: Recent Case Studies, Western Pacific Journal 4: 40-61. http://ssrn.com/abstract=91189

 

McGee, Robert W. 1994. The Fatal Flaw in NAFTA, GATT and All Other Trade Agreements, Northwestern Journal of International Law & Business 14(3): 549-565. http://ssrn.com/abstract=2348720

 

McGee, Robert W. and Walter Block. 1995. Initiating Antidumping Actions: Some Ethical Issues,” Twenty-First Annual Meeting of the Eastern Economic Association, New York City, March.

 

McGee, Robert W. and Walter Block. 1995. Must Protectionism Always Violate Rights? Twenty-First Annual Meeting of the Eastern Economic Association, New York City, March.

 

McGee, Robert W. 1995. The Moral Case for Free Trade, Journal of World Trade 29(1): 69-76. A revised version of this article is published at http://ssrn.com/abstract=2859183

 

McGee, Robert W. 1995. Antidumping Laws in the Twenty-First Century, Conference Proceedings, Fifth International Conference of the International Trade and Finance Association, San Jose, Costa Rica, May. Published in Khosrow Fatemi and Susan E.W. Nichols, editors, International Business in the 21st Century, Volume I, International Trade. (Laredo, TX: International Trade and Finance Association, 1995), 37-47.

 

McGee, Robert W. 1995. Recent Antidumping Cases Involving the People’s Republic of China, Proceedings, Fifth Asian Business and Economics Conference, Economic Trends and Accounting Practice in Asia, edited by Ibrahim Badawi and Edward B. Flowers, St. John’s University, New York City, November 4, pp. 125-130.

 

McGee, Robert W. and Yeomin Yoon. 1995. Trade Protectionism of the United States Toward Japan and Korea, International Journal of Korean Studies 2: 45-74. http://ssrn.com/abstract=2859301

 

McGee, Robert W. and Yeomin Yoon. 1995. Recent Antidumping Cases Involving Korea in the United States Domestic Market,” Korea’s Turn to Globalization and Korea-U.S. Economic Cooperation, conference co-sponsored by the International Society for Korean Studies in the Americas and Seton Hall University, Short Hills, New Jersey, July 28-29. Published by the Division of Research, W. Paul Stillman School of Business, Seton Hall University, pp. 73-86. Book Chapter.

 

McGee, Robert W. 1996. Application of the Antidumping Laws in Latin America: A Review of Recent Case Studies and Prospects for the Future,” Sixth Business and Economics Conference, St. John’s University, October 18-19.

 

McGee, Robert W. 1996. U.S. Trade Policy Toward the People’s Republic of China: Some Thoughts and Suggestions, Policy Analysis No. 4, The Dumont Institute for Public Policy Research, July. 13 pages. http://ssrn.com/abstract=39260

 

McGee, Robert W. 1996. Protectionism and Morality, Policy Analysis No. 5, The Dumont Institute for Public Policy Research, July. 18 pages. http://ssrn.com/abstract=79474

 

McGee, Robert W. 1996. Why Trade Deficits Don’t Matter, Policy Analysis No. 6, The Dumont Institute for Public Policy Research, July. 18 pages. http://ssrn.com/abstract=2138 Also see http://ssrn.com/abstract=2859145

 

McGee, Robert W. 1996. Applying the Antidumping Laws to the PRC: An Examination of Recent Case Studies,” 1996 Silver Anniversary Meeting of the Association for Asian Studies, Mid-Atlantic Region, held at Seton Hall University, South Orange, New Jersey, October 25-27.

 

McGee, Robert W. 1996. Should the Law Favor Consumers or Producers? A Look at the Effects of Protectionist Trade Policies, Policy Analysis No. 7, The Dumont Institute for Public Policy Research, July. 36 pages. http://ssrn.com/abstract=98348

 

McGee, Robert W. 1996. The Philosophy of Trade Protectionism, Its Costs and Its Implications, Policy Analysis No. 10, The Dumont Institute for Public Policy Research, July. 43 pages. http://ssrn.com/abstract=91369

 

McGee, Robert W. 1996. Antidumping Laws: A Bright Future for a Bad Idea, Policy Analysis No. 12, The Dumont Institute for Public Policy Research, July. 13 pages. http://ssrn.com/abstract=73991

 

McGee, Robert W. 1996. Antidumping Laws as Protectionist Trade Barriers: The Case for Repeal, Policy Analysis No. 14, The Dumont Institute for Public Policy Research, July. 88 pages. http://ssrn.com/abstract=91268

 

McGee, Robert W. and Yeomin Yoon. 1996. Trade Policy in the Computer Industry: Suggestions for Change, Policy Analysis No. 15, The Dumont Institute for Public Policy Research, July. http://ssrn.com/abstract=91270

 

McGee, Robert W. and Yeomin Yoon. 1996. A Discussion of Protectionist Trade Policies in the USA, Japan and Korea, Policy Analysis No. 16, The Dumont Institute for Public Policy Research, July. http://ssrn.com/abstract=91308

 

McGee, Robert W. and Yeomin Yoon. 1996. Some Recent U.S. Antidumping Cases Against Korea, Policy Analysis No. 17, The Dumont Institute for Public Policy Research, July. http://ssrn.com/abstract=91288

 

McGee, Robert W. and Yeomin Yoon. 1996. Do We Need Protectionism From Imports? A Reply to Alan Tonelson, Policy Analysis No. 18, The Dumont Institute for Public Policy Research, July. http://ssrn.com/abstract=91228

 

McGee, Robert W. 1996. Some Recent Studies on the Application of the U.S. Antidumping Laws Toward Malaysia and Thailand, Policy Analysis No. 23, The Dumont Institute for Public Policy Research, July. http://ssrn.com/abstract=91189

 

McGee, Robert W. 1996. The Forgotten Issue in Trade Talks, Competitiveness Review 6(1): 30-32.

 

McGee, Robert W. 1996. Some Thoughts on Antidumping Laws: Utilitarianism, Human Rights and the Case for Repeal, European Business Review 96(5): 27-33.

 

McGee, Robert W. 1996. Application of the Antidumping Laws to the People’s Republic of China: Nine Recent Case Studies, Policy Analysis No. 26, The Dumont Institute for Public Policy Research, October.

 

McGee, Robert W. and Yeomin Yoon. 1997. Recent Antidumping Cases Initiated by the United States against the People’s Republic of China,” Twenty-Sixth Annual Meeting of the Association for Asian Studies, Mid-Atlantic Region, West Chester University, West Chester, Pennsylvania, October.

 

McGee, Robert W. and Yeomin Yoon. 1997. Korea and the World Trade Organization: Problems and Prospects,” Proceedings of the Fifth International Conference on Korean Studies, Vol. 3, pp. 59-69, International Society for Korean Studies, Osaka, Japan, August.

 

McGee, Robert W. 1997. Application of the Antidumping Laws against Latin American Countries: Six Case Studies and Prospects for the Future,” 14th Conference of the Business Association of Latin American Studies, Rio de Janeiro, Brazil, April. Published in David Gertner, Paulo F. Bocater and Ricardo P.C. Leal, editors, Regionalism and Globalization in Latin America: A Contradiction? Proceedings of the Business Association of Latin American Studies 14th Conference, Rio de Janeiro (Rio de Janeiro: Business Association of Latin American Studies and Instituto de Administração e Gerência Pontifícia Universidade Católica do Rio de Janeiro, 1997), Volume I, 302-310. Book Chapter.

 

McGee, Robert W. 1997. Some Ethical Issues for Accountants in Antidumping Trade Cases: An Examination of Recent Case Studies with Emphasis on Latin America, 14th Conference of the Business Association of Latin American Studies, Rio de Janeiro, Brazil, April. Abstract published in David Gertner, Paulo F. Bocater and Ricardo P.C. Leal, editors, Regionalism and Globalization in Latin America: A Contradiction? Proceedings of the Business Association of Latin American Studies 14th Conference, Rio de Janeiro (Rio de Janeiro: Business Association of Latin American Studies and Instituto de Administração e Gerência Pontifícia Universidade Católica do Rio de Janeiro, 1997), Volume II, 838. Abstract published in Financial Accounting Abstracts WPS, Vol. 1, No. 2, February 10, 1997. Abstract published in International Trade Abstracts WPS, Vol. 2, No. 14, May 23, 1997. http://ssrn.com/abstract=15069

 

McGee, Robert W. 1997. The Violation of Generally Accepted Accounting Principles in the Area of Trade Regulation: An Examination of Some Recent Asian Antidumping Cases Brought by the United States Commerce Department, Fourth Annual Global Finance Conference, Montreal, Canada, May, 1997. Abstract published in Global Finance Conference Yearbook, pp. 27-28.

 

McGee, Robert W. 1997. Accounting for Exchange Rate Fluctuations in Antidumping Trade Cases: Ethics, the Absence of Generally Accepted Accounting Principles and Some Suggestions for Change, Conference Proceedings, International Business in the New Millennium, Seventh International Conference of the International Trade and Finance Association, Porto, Portugal, May, 1997. Published in Khosrow Fatemi, editor, International Business in the New Millennium, Volume III: International Capital Markets and Economic Integration (Laredo, TX: Texas A&M International University, 1997), 619-628. Book chapter.

McGee, Robert W. 1997. Some Ethical Issues for Accountants in Computing the Cost of Production in Antidumping Trade Cases: An Examination of Recent Case Studies with Emphasis on the People’s Republic of China, Conference Proceedings, International Business in the New Millennium, Seventh International Conference of the International Trade and Finance Association, Porto, Portugal, May. Abstract published in Khosrow Fatemi, editor, International Business in the New Millennium, Volume III: International Capital Markets and Economic Integration (Laredo, TX: Texas A&M International University, 1997), 948.

 

McGee, Robert W. and Walter Block. 1997. Must Protectionism Always Violate Rights? International Journal of Social Economics 24(4): 393-407.

 

McGee, Robert W. and Murray Sabrin. 1997. The Place of Trade Protectionism in a Free Society, International Convention of the Association of Private Enterprise Education, Washington, DC, April.

 

McGee, Robert W. 1997. The People’s Republic of China as the Number One Target of Antidumping Actions: What To Expect Under the World Trade Organization Rules, International Business with China: Opportunities and Challenges, a conference sponsored by the University of International Business and Economics and Montclair State University, Beijing, China, June. Abstract published in International Business with China: Opportunities and Challenges, Conference Program, pp. 24-25. Full article published in China Conference Proceedings, pp. 279-283. Book Chapter.

 

McGee, Robert W. 1997. The USA’s Assault on Trade With the People’s Republic of China: Antidumping Laws as Weapons of Protectionism, in Trade and Investment in Asia, edited by Edward B. Flowers, Thomas P. Chen and Ibrahim Badawi (New York: Center for Global Education, St. John’s University, 1997), 187-198. Book Chapter. http://ssrn.com/abstract=1081965

 

McGee, Robert W. and Walter Block. 1997. Ethical Aspects of Initiating Antidumping Actions, International Journal of Social Economics 24(6): 599-608.

 

McGee, Robert W. 1997. Accounting for Exchange Rate Fluctuations in Antidumping Trade Cases: Some Ethical Issues, Commentaries on the Law of Accounting & Finance 1: 101-110.

 

McGee, Robert W. and Yeomin Yoon. 1997. Do We Need Protection from Imports? A Reply to Alan Tonelson, Commentaries on Law & Economics 1: 21-27. http://ssrn.com/abstract=91228

 

McGee, Robert W. 1997. Some Ethical Questions for Attorneys Who Initiate Antidumping Actions, Commentaries on Law & Public Policy 1: 170-177. http://ssrn.com/abstract=2859283.

 

McGee, Robert W. 1997. The Ethics of Tax Evasion and Trade Protectionism from an Islamic Perspective,” Commentaries on Law & Public Policy 1: 250-262. http://ssrn.com/abstract=461397

 

McGee, Robert W. and Welber Barral. 1998. Aplicação De Medidas Antidumping Pelos Estados Unidos,” [Application of Antidumping Measures by the United States], Revista do Instituto de Pesquisas e Estudos, Divisão Jurídica, No. 20, Instituição Toledo de Ensino Bauru (Brasil), Dezembro a Março de 1998, 267-274.

 

McGee, Robert W. 1998. Trade Embargoes, Sanctions and Blockades: Some Overlooked Human Rights Issues, Journal of World Trade 32(4): 139-144.

 

McGee, Robert W. 1998. Some Ethical Issues in Trade Policy, Chinmaya Management Review (India) 2(2): 71-75. A revised version may be found at http://ssrn.com/abstract=2859168

 

McGee, Robert W. 1998. MFN Status, Trade Embargoes, Sanctions and Blockades: An Examination of Some Overlooked Property, Contract and Other Human Rights Issues,” Eighth International Conference, International Trade and Finance Association, Atlantic City, NJ, May, 1998. Published in Gulser Meric and Susan E.W. Nichols, editors, The Global Economy at the Turn of the Century, Vol. I, International Trade, (Laredo, TX: International Trade & Finance Association, 1998), 3-13.   Book Chapter. http://ssrn.com/abstract=87810

 

McGee, Robert W. 1998. Antidumping and the People’s Republic of China: Five Case Studies, Eighth International Conference, International Trade and Finance Association, Atlantic City, NJ, May, 1998. Robert W. McGee and Yeomin Yoon. Published in Gulser Meric and Susan E.W. Nichols, editors, The Global Economy at the Turn of the Century, Vol. I, International Trade, (Laredo, TX: International Trade & Finance Association, 1998), 63-78. Book Chapter. http://ssrn.com/abstract=87811

 

McGee, Robert W. 1999. Application of the Antidumping Laws in Latin America: A Review of Recent Cases and Prospects for the Future, in Edward B. Flowers, Thomas Chen and Jonchi Shyu editors, Interlocking Global Business Systems: The Restructuring of Industries, Economies and Capital Markets (Westport, CT: Greenwood Press, 1999), 275-286. Book Chapter.

 

McGee, Robert W. 1999. Antidumping Laws, the World Trade Organization and the People’s Republic of China, in Nigel Campbell, series editor, Advances in Chinese Industrial Studies, Vol. 6, The Managerial Process and Impact of Foreign Investment in Greater China (Stamford, CT: JAI Press, 1999), 141-155. Book Chapter.

 

McGee, Robert W. 1999. Minimal Ethical and Legal Absolutes in Foreign Trade, in Tibor Machan, editor, Business Ethics in the Global Market (Stanford, CA: Hoover Institution Press, 1999), 63-86.. Book Chapter.

 

McGee, Robert W. and Yeomin Yoon. 2000. Some Thoughts on Antidumping Laws with Special Reference to Korea, presented at the Joint Korea-America Economic Association and Korea Economic Association Conference in Seoul, Korea in August 18-20.

 

McGee, Robert W. and Yeomin Yoon. 2000. The Takings Clause and Compensation for Trade Sanctions, Journal of Applied Management and Entrepreneurship. 5(2): 161-171. http://ssrn.com/abstract=242428

 

McGee, Robert W. 2000. The Cost of Protectionism: Rent-Seeking by Producers at the Expense of Consumers, in Sir Hans Singer, Neelambar Hatti and Rameshwar Tandon, editors, TRIPS, The Uruguay Round and Third World Interests, Volume 15 of the New World Order Series, (New Delhi, India: B.R. Publishing Corporation, 2000). Book Chapter. For a different paper on the same topic, see http://ssrn.com/abstract=2858509

 

McGee, Robert W. 2000. Some Ethical Aspects of Antidumping Laws,” Reason Papers 25: 55-67. http://ssrn.com/abstract=242412

 

McGee, Robert W. and Yeomin Yoon. 2001. A Look at Economic Sanctions from a Business Perspective, International Applied Business Research Conference, Cancun, Mexico. March 2001. Published in the Conference Proceedings, pp. 1-7. http://ssrn.com/abstract=2861240

 

McGee, Robert W. and Yeomin Yoon. 2001. Some Economic and Ethical Problems with Trade Sanctions, International Trade & Finance Association International Conference, Washington, DC, May 2001. http://ssrn.com/abstract=2861234

 

McGee, Robert W. and Yeomin Yoon. 2002. A Close Look at the U.S. Steel Industry: Protective Tariffs and Their Effect on the Economies of East Asia. The 10th Annual Economics Convention sponsored jointly by the Korea-America Economic Association and Korea Economic Association, Yonsei University, Seoul, Korea, August 12-13. http://ssrn.com/abstract=2858439

 

McGee, Robert W. 2002. The Ethics of the U.S. Antidumping Laws and Policies, International Trade & Finance Association, held in conjunction with the Allied Social Science Association (ASSA) Annual Meeting, Atlanta, January. http://ssrn.com/abstract=2861273

 

McGee, Robert W. 2002. Legal Ethics, Business Ethics and International Trade: Some Neglected Issues, Cardozo Journal of International and Comparative Law 19(1): 109-216. http://ssrn.com/abstract=442660

 

McGee, Robert W. 2002. Abolish the Antidumping Laws. Economic Affairs 22(4): 49-57. http://ssrn.com/abstract=368782

 

McGee, Robert W. and Yeomin Yoon. 2003. Labor Standards and Trade Agreements: Raising Standards or Raising the Walls of Protectionism? International Trade & Finance Association, held in conjunction with the Allied Social Science Association (ASSA) Annual Meeting, January, 2003, Washington, DC.

 

McGee, Robert W. 2003. The Ethics of Using Government to Subvert Competition: The Case of the Antidumping Laws. In Jerry Biberman and Abbass F. Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume X (Saline, MI: McNaughton & Gunn, Inc., 2003), co-published by arrangement with the International Academy of Business Disciplines, pp. 303-307. http://ssrn.com/abstract=242411

 

McGee, Robert W. 2003. Trade Policy as Corporate Welfare: The Case of the U.S. Steel Industry. In Jerry Biberman and Abbass F. Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume X (Saline, MI: McNaughton & Gunn, Inc., 2003), co-published by arrangement with the International Academy of Business Disciplines, pp. 585-589. http://ssrn.com/abstract=410817

 

McGee, Robert W. 2004. The Two Faces of U.S. Trade Policy: Advocating Free Trade while Practicing Protectionism with Emphasis on Applying Antidumping Laws against Republics of the Former Soviet Union (CIS), in Erdener Kaynak and Talha D. Harcar, editors, International Management Development Research Yearbook, Hummelstown, PA: International Management Development Association, 2004, pp. 410-417. http://ssrn.com/abstract=546342

 

McGee, Robert W. 2004. Recent Antidumping Cases involving Companies in Russia and Ukraine, in Erdener Kaynak and Talha D. Harcar, editors, International Management Development Research Yearbook, Hummelstown, PA: International Management Development Association, 2004, pp. 526-533. http://ssrn.com/abstract=572141

 

McGee, Robert W. 2004. Recent Antidumping Cases involving Companies in Russia and Ukraine. Published in the Proceedings of the Thirteenth Annual World Business Congress, International Management Development Association (IMDA), Maastricht, the Netherlands, July 14-18, 2004, pp. 526-533. http://ssrn.com/abstract=572141

 

McGee, Robert W. 2004. Outsourcing: Creative Destruction, Effective Executive 6(12): 33-37.

 

McGee, Robert W. 2004. Trade Sanctions as a Tool of International Relations. Commentaries on Law & Public Policy 2: 229-303. http://ssrn.com/abstract=615724

 

McGee, Robert W. 2004. Recent Antidumping Cases involving Companies in Russia and Ukraine. Russian/CIS Energy & Mining Law Journal 5: 7-16. http://ssrn.com/abstract=572141

 

McGee, Robert W. 2004. Two Faces of U.S. Trade Policy: Advocating Free Trade While Practicing Protectionism with Emphasis on Applying Antidumping Laws against Republics of the Former Soviet Union (CIS). Andreas School of Business Working Paper, Barry University, Miami Shores, FL 33161 USA, May. http://ssrn.com/abstract=546342

 

McGee, Robert W. 2005. Ethical Issues in Outsourcing Accounting and Tax Services. Marjorie G. Adams and Abbass Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume XII, No. 1 (International Graphics: Beltsville, MD), 45-49. http://ssrn.com/abstract=648766

 

McGee, Robert W. 2005. Ethical Issues in Outsourcing Accounting and Tax Services. 17th Annual Meeting, International Academy of Business Disciplines, Pittsburgh, PA. April 7-10, 2005. An abbreviated version was published as a book chapter in Marjorie G. Adams and Abbass Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume XII, No. 1, Beltsville, MD: International Graphics, pp. 45-49. http://ssrn.com/abstract=648766

 

McGee, Robert W. 2005. Outsourcing: An Ethical Analysis of an International Trade Issue. Marjorie G. Adams and Abbass Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume XII, No. 1 (International Graphics: Beltsville, MD), 335-339. http://ssrn.com/abstract=648764

 

McGee, Robert W. 2005. Outsourcing: An Ethical Analysis of an International Trade Issue. 17th Annual Meeting, International Academy of Business Disciplines, Pittsburgh, PA. April 7-10. An abbreviated version was published as a book chapter in Marjorie G. Adams and Abbass Alkhafaji, editors, Business Research Yearbook: Global Business Perspectives, Volume XII, No. 1, Beltsville, MD: International Graphics, 2005, pp. 335-339. http://ssrn.com/abstract=648764

 

McGee, Robert W. and Yeomin Yoon. 2006. Should Labor Standards be a Part of Trade Talks? In Robert V. Weeks, editor, Trends in International Trade Issues, Hauppauge, NY: Nova Science Publishers, 2006, pp. 119-128. Book chapter.

 

McGee, Robert W. 2006. Ethical Aspects of Using Government to Subvert Competition: Antidumping Laws as a Case Study of Rent Seeking Activity. Andreas School of Business Working Paper, Barry University, Miami Shores, FL 33161 USA, September, 2006. http://ssrn.com/abstract=242411

 

McGee, Robert W. 2006. Antidumping, Business Ethics and International Relations. Andreas School of Business Working Paper, Barry University, Miami Shores, FL 33161 USA, November, 2006. http://ssrn.com/abstract=947929

 

McGee, Robert W. 2007. Antidumping, Ethics and International Relations. Presented at the 2007 International Academy of Business and Public Administration Disciplines ( IABPAD) Winter Conference, Orlando, Florida, January 4-7, 2007. Published in the Proceedings of the International Academy of Business and Public Administration Disciplines 4(1): 693-708 (2007). http://ssrn.com/abstract=947929

 

McGee, Robert W. 2008. Ethical Aspects of Using Government to Subvert Competition: Antidumping Laws as a Case Study of Rent Seeking Activity. Journal of Business Ethics 83: 759-771. http://ssrn.com/abstract=242411

 

McGee, Robert W. 2008. Antidumping, Business Ethics and International Relations, International Journal of Business, Accounting and Finance 2(1): 37-51 (2008). http://ssrn.com/abstract=947929

 

McGee, Robert W. 2008. Antidumping Laws as Weapons of Protectionism: Asian Case Studies, Manchester Journal of International Economic Law 5(1): 36-69. https://www.electronicpublications.org/stuff.php?id=221

 

McGee, Robert W. 2009. Essays in International Trade. Hyderabad, India: ICFAI University Press.

 

McGee, Robert W. and Yeomin Yoon. 2009. Labor Standards and Human Rights: A Look at Some Neglected Rights Issues, in Readings in Business Ethics. Hyderabad, India: ICFAI University Press, pp. 100-112. http://ssrn.com/abstract=409040

 

McGee, Robert W. and Yeomin Yoon. 2009. A Close Look at the U.S. Steel Industry: Protective Tariffs and Their Effect on the Economies of East Asia, in Essays in International Trade. Hyderabad, India: ICFAI University Press, 2009, pp. 76-91. http://ssrn.com/abstract=2858439

 

McGee, Robert W. and Yeomin Yoon. 2009. Rethinking the Antidumping Laws and Policies with Reference to East Asian Trading Partners of the U.S. (China, Japan and Korea) in Essays in International Trade. Hyderabad, India: ICFAI University Press, 2009, pp. 143-151. http://ssrn.com/abstract=2858442

 

McGee, Robert W. and Galina G. Preobragenskaya. 2009. Some Accounting and Technical Problems with Antidumping Trade Cases involving Transition Economies: A Russian Case Study, in Essays in International Trade. Hyderabad, India: ICFAI University Press, 2009, pp. 200-221.

 

McGee, Robert W. and Yeomin Yoon. 2009. Incorporating Labor Standards into Trade Agreements: An Ethical Analysis, in Essays in International Trade. Hyderabad, India: ICFAI University Press, 2009, pp. 222-234. http://ssrn.com/abstract=410362

 

McGee, Robert W. and Yeomin Yoon. 2010. Antidumping Laws Should be Consigned to the History Books. Presented at the International Law Society of Rutgers University Symposium, Newark, NJ, April 2, 2010. http://ssrn.com/abstract=2861270

 

McGee, Robert W. 2011. Economic Protectionism and the Philosophy of Frédéric Bastiat, Brooklyn Journal of Corporate, Financial & Commercial Law 5(2): 427-446. http://ssrn.com/abstract=2435943.

 

McGee, Robert W. 2011. Ethical Aspects of Economic Sanctions: A Third Theory, International Journal of Business and Public Administration, 8(2): 125-137. http://ssrn.com/abstract=2417824

 

McGee, Robert W. 2011. Ethical Aspects of Economic Sanctions: A Third Theory, International Journal of Business and Economics Perspectives 6(2): 29-41. http://ssrn.com/abstract=2417824

 

McGee, Robert W. 2014. Some Thoughts on the Ethics of Parking Profits Offshore. Journal of Accounting, Ethics & Public Policy 15(1): 165-174. http://ssrn.com/abstract=2410020

 

McGee, Robert W. 2014. Should We Impose Sanctions on Russia Because of the Crimea? European Law & Politics Journal 1(2): 1-9. Reprinted at http://ssrn.com/abstract=2545725

 

McGee, Robert W. 2014. Trade. In Markus Vodosek and Deanne Van Hartog (eds) Wiley Encyclopedia of Management, 3rd edition, Volume 6: International Management. New York: John Wiley & Sons.

 

McGee, Robert W. 2016. Ethics in International Trade. Working Paper, October 24, 2016. http://ssrn.com/abstract=2858409

 

McGee, Robert W. 2016. Business in the Global Community. Working Paper, October 24, 2016. http://ssrn.com/abstract=2858395

 

McGee, Robert W. 2016. Trump, and the Trade Policy of a Free Society. Working Paper, October 24, 2016. http://ssrn.com/abstract=2858396

 

McGee, Robert W. 2016. Why the USA is Doomed to Have Trade Deficits, and Why It Doesn’t Matter. Working Paper, October 24, 2016. http://ssrn.com/abstract=2858432

 

McGee, Robert W. 2016. Outsourcing. Working Paper, October 24, 2016. http://ssrn.com/abstract=2858485

 

McGee, Robert W. 2016. Minimum Ethical and Legal Absolutes in Foreign Trade. Working Paper. http://ssrn.com/abstract=2859162

 

McGee, Robert W. and Yeomin Yoon. 2016. A Look at Labor Standards and Neglected Human Rights Issues. Working Paper. http://ssrn.com/abstract=2861247

 

McGee, Robert W. and Yeomin Yoon. 2016. Antidumping Laws Should Be Consigned to the History Books. Working Paper. http://ssrn.com/abstract=2861270

 

McGee, Robert W. 2016. The Ethics of the U.S. Antidumping Laws and Policies. Working Paper. http://ssrn.com/abstract=2861273

 

McGee, Robert W. 2016. Ethics in International Trade. Working Paper. http://ssrn.com/abstract=2861293

 

Yoon, Yeomin & Robert W. McGee. 1997. Applying the Antidumping Laws after the Uruguay Round: Some Recent Case Studies, The Northeast Business & Economics Association 1997 Annual Conference, Philadelphia, PA, September 26-27. Yeomin Yoon and Robert W. McGee. Extended abstract published in Northeast Business & Economics Association 1997 Annual Conference Proceedings, pp. 140-141.

 

Yoon, Yeomin & Robert W. McGee. 1997. The Korean Chip Dumping Controversy: A Case Study of Antidumping as Rent-Seeking Behavior, Commentaries on Law & Economics 1: 128-163. http://ssrn.com/abstract=2859293

 

Yoon, Yeomin, Robert W. McGee and Walter Block. 1999. Antidumping and the People’s Republic of China: Five Case Studies, The Asian Economic Review, 41(2): 208-217. http://ssrn.com/abstract=87811

 

Yoon, Yeomin and Robert W. McGee. 2001. What’s Wrong with America’s Antidumping Policy? International Trade & Finance Association International Conference, Washington, DC, May. http://ssrn.com/abstract=2861237

 

Yoon, Yeomin & Robert W. McGee. 2001. The Problem with the WTO’s Antidumping Provision, 52nd International Atlantic Economic Society Conference, Philadelphia, October 11-14.

 

Yoon, Yeomin and Robert W. McGee. 2002. Protective Tariffs of the U.S. on Steel Imports and Their Effect on the Economies of East Asia. Journal of Global Business 13(25): 27-38. http://ssrn.com/abstract=2858439

 

Politics & Viewpoints from Political Parties

A Libertarian View: Should Those Who Burn the American Flag be Punished?

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Hello Readers, here is a libertarian view from the highly credentialed Robert W. McGee on whether there should be punishment for burning the American flag. I welcome views on this issue from any party affiliation. Please comment below to add your viewpoint. Thanks! LeslieLawyerJD

SHOULD THOSE WHO BURN THE AMERICAN FLAG BE PUNISHED?

Author: Robert W. McGee

December 4, 2016

Burning the American flag has been done for decades to protest various American policies. It is considered by many to be an exercise of the right of free speech. Donald Trump has called for flag burners to be punished by fines, imprisonment and/or loss of American citizenship.

Which view is correct? Actually, the answer can be found in property rights theory. The person who owns the flag should be able to burn it. In a strong property rights regime, individuals are able to do anything they want with their own property, provided they don’t violate the rights of others. No one’s rights are violated when you burn a flag that belongs to you. Prohibiting the burning of American flags, or punishing someone who burns his own flag, necessarily violates property rights. The reason governments were formed was to protect the rights to life, liberty and property. To the extent that some government violates property rights, it loses its legitimacy.

BIO

Robert W. McGee holds 13 doctorates from universities in the United States and four European countries. Before becoming a novelist he was an attorney, CPA, professor and consultant. He has won 4 silver and 2 bronze medals at Martial Arts World Championship tournaments. You may read about his novels at http://robertwmcgee.com. You can download more than 400 of his scholarly papers here. http://ssrn.com/author=2139.

criminal law

Shackles Before Sentencing: The Global Positioning System as a Means of Pretrial Restraint

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As indicated in an Orlando Sentinel Article in 2015,  reinstatement of electronic monitoring via Global Positioning System is not being considered at this time. However, we never know what the future could holds so it is good for lawyers to understand the arguments behind this issue.

AUTHOR: Blair Jackson, JD

What do famous Hollywood starlets Lindsay Lohan and Paris Hilton have in common with thousands of other Americans? Both have been subject to electronic monitoring via the Global Positioning System. Global Positioning Systems have become indispensable tools aiding drivers of automobiles to safely and efficiently reach their destinations. Global Positioning Systems are also being utilized with greater frequency in our nation’s criminal justice system. One notable use of a Global Positioning System is to gather information about a suspect in a criminal case, which has recently been examined in State v. Jones. Additionally, Global Positioning Systems are used routinely by our courts to monitor the travel of criminal defendants once they have been charged with a crime and, in some circumstances, as a condition of a sentence.

This article discusses the use of a Global Positioning System as both a supplement or, in some cases, substitute for standard bond conditions in criminal cases. Its technology offers obvious benefits to courts seeking to keep the criminal defendant away from a victim and to keep close tabs on a defendant’s whereabouts. Given the heightened level of intrusion that exists when an electronic device is attached to an individual, do our courts have carefully drafted guidelines that must be established before such a device may be implemented?

This article explores this question by looking at criteria (or the lack thereof) utilized by courts in Alabama, Oklahoma and Arizona to examine whether the individual’s constitutional rights are being appropriately safeguarded when Global Positioning System monitoring becomes an issue in the pretrial phase of a criminal proceeding. The article concludes that most states have little to no legislation that might guide a court when determining when a Global Positioning System should be appropriately applied, and suggests specific requirements that would at least be somewhat analogous to conditions of bond in a criminal case.

Click to read entire law review

 

 

Politics & Economics

Dodd-Frank Act for Beginners-“Keep it or Repeal it?” 

Author: Leslie Ferderigos, JD

I will by no means say I am an expert or even close to it when it comes American economics. In fact, I really didn’t even thoroughly understand the difference in each political parties economic platforms until recently. So why even read this blog? You should read it because even though I hardly knew anything in this area, I did spend hours over the last weeks researching and interviewing both republicans and democrats on their idea behind whether they believed the Dodd-Frank Act should be kept or repealed. Reading this article will  save you time and allow you to contribute intelligently to the next Dodd-Frank conversation without having spent your life on Wall Street or put in the hours like I did over the past few weeks.

For those who do not know what the Dodd-Frank Act is, I will take you thru a brief historical timeline leading up to its creation. Again, this will be brief so I encourage you to do more research for a thorough understanding in the political party debate of regulation vs deregulation. If you are really interested, maybe even dissect the act itself.

  • Great Depression: 1929-late 1930s
  • Creation of Glass-Steagall act (government regulation) 1930s – 1999
  • Repeal of Glass-Steagall act: 1999
  • 2007 market crash: 2007-2008
  • Creation of Dodd-Frank act: 2010 (government regulation)

After tracing historical events leading to the creation of the Dodd-Frank Act, I reached out to both Right wing and Left wing advocates to see what each side had say. I posted this comment on my social media and waited for responses:

Hello Friends: Trump wants Congress to repeal this act, that was set up by Obama to protect the consumer after the 2007 market crash. I am wondering the long term effects it will have once repealed. Last time deregulation was allowed in this area, we hit our biggest housing crash since the Great Depression. This is something I am unfamiliar with and appreciate any insight from those more researched in this area. Any thoughts?

The Right Wing says…this answer came from a professional with over 70 years experience in banking, lending, and financial service:

Dodd-Frank only served to make the too big to fail banks bigger and stronger. It has destroyed competition within the banking industry, driven up the cost of banking for consumers, and reduced the availability of credit. It has a very detrimental impact on the growth of small business in this country, that segment of the economy that has responsible for the largest number of new jobs created. It has only served to further entrench the corrupt banks that worked with corrupt politicians to create the conditions that led to the 2007 market collapse. What does need to be reestablished are portions of Glass-Steagall. 

The intent of the Volcker Rule is sound, but like a lot of things the devil is always in the details. If we recall the S&L crisis of the late 80s was also centered around “speculative investment” activities as well. As structured the rule has had a detrimental impact on community banks. The larger banks have yet to comply with the law and have pressed for an extension to their exception. The narrative that has been pushed by both the government and the main stream media is that the 2007 crisis was caused by the large banks, when in fact it was caused by the government facilitating and coercing the banking industry into making risky loans, loans that they would not have made otherwise. Yes, the final straw in 2007 had to do with derivative investments associated with mortgage backed assets, but the reasons those investments were such a problem was that the underlying loans were a problem, loans that never would have existed without government guarantees. When the government bailed out the too big to fail banks they were effectively bailing themselves out! Dodd-Frank was sold as the remedy when in fact it only strengthened the ability of the too big to fail banks to maintain market dominance. The real underlying problem was and is government guarantees, regulation, and coercion that results in bad loans and market distortions. Since 2007 we have seen this repeating itself in the student loan market, and to a large extent the health care markets as well.

The Left Wing says…these responses come from various left wing lawyers:

We have to watch this closely. I am affiliated with an organization that does this work and we are concern about the repeal which will open The door for predatory lenders

The Dodd Frank Act is a very weak protection for borrowers but it was the best bill possible at the time; without it we’re losing a lot of ground.

Wasn’t Dodd-Frank largely toothless? The major financial deregulation occurred with the Glass-Steagal repeal and Commodity Futures Modernization Act passage under Bill Clinton. Though I’m sure Bill and his acolytes would dispute that, naturally.

In reality, nothing is to stop the market from doing that now. And critics are right: the costs of compliance falls most heavily on smaller banks. But there’s ways to pass real financial regulation that prevents the abuses leading up to the housing crash (if not removing that risk altogether). Dodd-Frank just isn’t it- though some provisions, like some functions of the CFPB, have proven useful. As an aside, along with Trump, several states are suing the Fed Gov’t over Dodd-Frank’s constitutionality.

Not toothless. It gave a lot of new tools and mandates to the Cftc and SEC, among other things. Dodd frank is huuuuge. It’s hard to make generalizations on it. Some people hate how it affecting the mortgage lending industry, but that is a very small part of it

Toothless to a point, but remember that it helped create the CFPB. If that act fails, CFPB disappears. We lose a BIG watchdog. 

The current view as I have heard it is that it is less likely that the entire Act will be rolled back, and more likely that selected investment and securitization reforms will be rolled back. The CFPB will probably be weakened by reducing its autonomy further, reducing its funding and/or filling it with bank-friendly appointees. Banks have spent a lot of money to comply with the CFPBs rules up to this point… rolling everything back would be more expensive than just hitting pause.

 

I hope this blog gave you the basic idea behind  issues on the Dodd-Frank Act. If your an expert in this area, maybe you enjoyed hearing what each party had to say. For the beginners, the next time you hear someone speak of the Dodd-Frank Act, you can intelligently join in the conversation and maybe even impress someone

Happy learning!!

Leslie Ferderigos, JD

Tax Law

TAX TIPS by Richard Colombik

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POSTED BY RICHARD COLOMBIK ON OCTOBER 11, 2016
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On August 5th, 1997, President Clinton signed the Tax Relief Act of 1997. The majority of the changes apply for years beginning after December 31st, 1997. Exceptions to this include the Capital Gains Tax relief and the new exclusion for sellers of their principal residence.
HIGHLIGHTS OF NEW TAX ACT
TAX CREDIT FOR EACH QUALIFYING DEPENDENT CHILD UNDER AGE 18.
Beginning in 1998 parents get a tax credit equal to $400.00, $500.00 after 1998, for each qualifying dependent child under age 18. A phase out of the tax credit applies for joint taxpayers whose adjusted gross income exceeds $110,000.00.

IRAs DO NOT GO AWAY
Beginning in 1998 deductible IRA contributions will be easier. A spouse who is not a retirement plan participant, will be able to make a deductible IRA contribution, even if the other spouse is a plan participant. This new break phases out for those with adjusted gross income over $150,000.00.
ROTH IRA
This new IRA will not give you a deduction when you put the funds in, but will result in tax free distributions for payouts made after five years of maintaining the account after attaining age 59-1/2, death, disability or for certain first-time home buyer expenses. For joint filers, the phase out of this benefit is at $150,000.00.
Other IRA changes include non-deductible contributions up to $500.00 per beneficiary to an educational IRA. Distributions from the educational IRA to pay college expenses, will be tax and penalty free, if certain conditions are met.
INTEREST DEDUCTION BREAK
Part of qualified educational loan interest due and paid after 1997, may also be deductible. The maximum deductible amount is $1,000.00 for 1998, increases at $500.00 per year through 2001. Income restrictions are a bit more strict. Phase out occurs at $60,000.00 for joint filers.
CAPITAL GAINS BREAK
The top marginal tax rate on long-term capital gains has been reduced from 28% to 20%. This is for taxpayers in the maximum tax bracket. For those taxpayers who are not as fortunate, for example, a taxpayer in a 15% tax bracket, long-term capital gains would be taxed at only a 10% tax rate. There are new holding periods to comply with though, so be careful before your start selling your assets to receive the new law’s benefit.
For example, after July 8th, 1997, the new rates only apply if you held an asset for more than eighteen months on its sale date. This is a drastic change from the old law which provided for capital gain rates after twelve months.
CAVEAT
Long-term capital gains from the sales of collectibles continue to be taxed at a maximum rate of 28%, as well as additional exceptions to the rule.
HOMEOWNER TAX BREAK
Until the new tax law passed, homeowners were allowed a once-in-a-lifetime exclusion of $125,000.00, if they were age 55 or over. The new tax law allows up to a $250,000.00 of home sale profit to be tax free if the sale takes place after May 6th, 1997. For married parties filing joint, the exclusion is doubled to $500,000.00. This should be a major incentive for people to sell expensive homes and to be able to move down to a less expensive residence.
PROBLEMS FOR PAYMENTS TO LAWYERS
On all post-1997 payments to attorneys made in the course of a trade or business must now be reported to the IRS. The only exclusion would be payments already reported on a Form 1099 Misc. and a Form W-2. Obviously, the IRS is sending a message to attorneys who receive cash and may not have reported it. This provision is especially important to business taxpayers as they would generally be the entities on a regular and consistent basis paying legal fees.
Other unusual changes include the net operating loss carryback being decreased from two to three years, but increasing the carryforward from fifteen to twenty years. This change is relative to losses arising in tax years beginning after August 5th, 1997.
INDEPENDENT CONTRACTORS COVERED BY PENSION PLAN
Vizcaino et al vs. Microsoft, (9th Cir 1997.) During the late 1980s Microsoft employed a staff of regular employees who received a wide variety employee benefits, as well as using “freelancers”. The freelancers were considered to be independent contractors and a supplement to the regular staff. The freelancers were fully integrated into Microsoft’s work force, often working on teams with regular employees, sharing the same supervisors, performing the same functions, and working the same hours.
Microsoft required the freelancers to work on its premises, gave them admittance keys, office equipment and supplies. Unlike regular employees, however, they were not allowed to assign their work to others, nor were they paid overtime wages. Microsoft further did not issue the freelancer’s checks through the payroll department. The freelancers were required to submit invoices to the accounts payable department. They were also required to sign agreements acknowledging they were self-employed independent contractors who were responsible for their own taxes.
The IRS performed an employee-independent contractor audit at Microsoft. Utilizing the common-law factors to differentiate between employees and contractors, the IRS concluded that the freelancers were employees for income tax withholding and employment tax purpose. Microsoft thereupon issued the workers W-2s and paid its share of employment taxes for the year at issue. It then either offered the freelancers regular employment, or gave them the opportunity to work for a temporary agency that supplied workers to Microsoft.
A group of the freelancers then sought various Microsoft employee benefits, including participation in its 401-K Plan and its employee stock purchase plan, ESOP. Microsoft alleged their prior independent contractors’ agreement waived their right to benefits, and even if they had not, they would not deemed to be regular full-time employees and would otherwise not qualify.
The 9th Circuit Court of Appeals initially in a three judge panel had ruled that the independent contractors were common-law employees. Microsoft’s intent about their employment status was immaterial and assigned the case back to the plan administrator to the 401-K Plan. This particular issue on ESOP benefits then went back up to the 9th Circuit Court of Appeals, relative to whether the “employees” also qualified for the ESOP. The court held that the freelancers did indeed qualify as employees and, therefore, would also qualify for the plan.
This ruling is extremely important to all employers that have independent contractors, shared employees or other types of structures to eliminate employment taxes. The setup and structure of Employee vs. Independent Contractor, particularly with respect to fringe benefits is an extremely important issue and should be reviewed by your tax attorney immediately. In light of the court’s decision in Microsoft, it is clear that this issue will be hotly contested. Please feel to contact our firm to review your company’s status. Our firm is in the process of writing an extensive analysis of the new tax law. Please feel free to contact us for a complimentary copy after its publication.

Click here to visit Richard Colombik’s website
WRITTEN BY RICHARD COLOMBIK
Richard M. Colombik, JD, CPA, is an honors graduate attorney and licensed Certified Public Accountant. Mr. Colombik is also a member of the National Liaison Committee to the Internal Revenue Service for the American Association of Attorney CPAs, Inc. and is a noted author, lecturer, and former Chairman of the Illinois State Bar Association’s Federal Tax Committee, as well as a member of the American Bar Association’s Asset Protection Committee. The creator of the Tax Law Solutions strategies, Mr. Colombik, a Managing Partner, brings a diverse taxation and Managing Business Partner background to Tax Law Solutions and its clientele.

Family Law

Sad Reality of Post-Divorce Power Struggles between Co-Parents 

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Author: Leslie Ann Ferderigos, JD

It wasn’t long ago that Florida courts used the primary care-giver standard to determine who would be awarded custody of the children. I remember speaking to numerous friends growing up where fathers took a back seat to the mother on many issues because the father was viewed by society as holding less parental rights. Some fathers gave up and eventually walked out of a child’s life because the mother made it merely impossible to have a relationship with the child. Was this outcome the result of gender bias and words like “custody”, that ultimately lead to the power struggle between divorced parents?

If our government is built on the concepts of separation of powers to avoid man’s innate desire to abuse power, then why would family courts believe parents would be any different.

Presently, family law has made efforts to equalize the power between parents. Courts have abandoned the term custody, replacing it with parental responsibility and time-sharing. The primary caregiver standard has been replaced with the child’s best interest standard. The court now favors awarding shared parental responsibility which grants equal decision-making power on important decisions in a child’s life.

Have these changes been enough? The Law has evolved, but without societal awareness and judges holding parties accountable, it continues to be a struggle for many secondary residential parents who try to exercise their rights. Just last year, I spoke to a father with shared parental responsibility, who discovered his child was getting counseling and no effort was ever made to obtain his consent prior to starting the sessions. He also learned that same year that his child was withdrawn and transferred to another school without ever notifying him. When he spoke to a local attorney to find out how to prevent these types of unilateral decisions, he was told that even if the law is on his side there is judges discretion as to how this will be ruled on and most judges don’t want to waste time on issues that are not detrimental to the child.

Although the law has evolved to equalize power between parties, society needs to catch up and judges need to hold parties accountable.

 

AUTHOR: Leslie Ann Ferderigos, JD

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Tax Law

Tax Planning MUST happen now!!!

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AUTHOR: RICHARD COLOMBIK, JD, CPA

Congratulations to incoming President Trump. Yet many have questioned what happens to income tax planning?

First, 2016 tax rates are at 39.6% for individuals and 39% for Federal Corporate rates. State taxation has not changed and has a top rate of 13.3% in California. The additional Medicare taxes are still the law, but will hopefully be eliminated in coming years.
What has changed today? NOTHING, ABSOLUTLEY NOTHING. The tax law is still the law.

Going forward, Trump proposed a sketchy tax plan, that even he said was a work in progress. It offered lower top tax rates, but also a limit on itemized deductions, so that charitable, mortgage interest, state income tax deductions and real estate would be limited. In fact, combined itemized deductions above $200,000 for couples and $100,000 for individuals would not be allowed. This platform will of course be modified by the Political Process, committees and special interest groups. Will charitable deductions really be limited?

Reality Check, is that the President cannot and does not write laws, only the House and Congress can pass laws, the President can veto or execute the legislation. Until next year we will not even have a proposal on the table, and we have no idea what the proposal will be. One thing I can guarantee is that it will NOT be the sketchy details that were provided, as too much is unknown and political wrangling will come to fruition. There will be change, but not as drastic as proposed when one reviews the net effect of the proposals

The only constant is to plan your taxes today, under today’s laws with a company that can structure a flexible plan that will be modified year to year as the law changes, which it always does. TLS includes an initial annual monitoring to maximize your tax plan after it is structured. That is the proactive, positive way to save taxes today and to save taxes each and every year.

RICHARD COLOMBIK
Richard M. Colombik, JD, CPA, is an honors graduate attorney and licensed Certified Public Accountant. Mr. Colombik is also a member of the National Liaison Committee to the Internal Revenue Service for the American Association of Attorney CPAs, Inc. and is a noted author, lecturer, and former Chairman of the Illinois State Bar Association’s Federal Tax Committee, as well as a member of the American Bar Association’s Asset Protection Committee. The creator of the Tax Law Solutions strategies, Mr. Colombik, a Managing Partner, brings a diverse taxation and Managing Business Partner background to Tax Law Solutions and its clientele.

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