Saturday, March 22, 2014

The Future of Europe: An Interview with George Soros

Schmitz: What do you think of Vladimir Putin’s recent policies with respect to Ukraine, Crimea, and Europe?

Soros: Now you are coming to the crux of the matter. Russia is emerging as a big geopolitical player, and the European Union needs to realize that it has a resurgent rival on its east. Russia badly needs Europe as a partner, but Putin is positioning it as a rival. There are significant political forces within the Russian regime that are critical of Putin’s policy on that score.

Schmitz: Can you be more specific?

Soros: The important thing to remember is that Putin is leading from a position of weakness. He was quite popular in Russia because he restored some order out of the chaos. The new order is not all that different from the old one, but the fact that it is open to the outside world is a definite improvement, an important element in its stability. But then the prearranged switch with Dmitry Medvedev from prime minister to president deeply upset the people. Putin felt existentially threatened by the protest movement. He became repressive at home and aggressive abroad.

That is when Russia started shipping armaments to the Assad regime in Syria on a massive scale and helped turn the tide against the rebels. The gamble paid off because of the preoccupation of the Western powers—the United States and the EU—with their internal problems. Barack Obama wanted to retaliate against Syria’s use of chemical weapons. He asked for congressional approval and was about to be rebuffed when Putin came to the rescue and persuaded Assad to voluntarily surrender his chemical weapons.

That was a resounding diplomatic victory for him. Yet the spontaneous uprising of the Ukrainian people must have taught Putin that his dream of reconstituting what is left of the Russian Empire is unattainable. He is now facing a choice between persevering or changing course and becoming more cooperative abroad and less repressive at home. His current course has already proved to be self-defeating, but he appears to be persevering.

Schmitz: Is Russia a credible threat to Europe if its economy is as weak as you say?

Soros: The oligarchs who control much of the Russian economy don’t have any confidence in the regime. They send their children and money abroad. That is what makes the economy so weak. Even with oil over $100 a barrel, which is the minimum Russia needs to balance its budget, it is not growing. Putin turned aggressive out of weakness. He is acting in self-defense. He has no scruples, he can be ruthless, but he is a judo expert, not a sadist—so the economic weakness and the aggressive behavior are entirely self-consistent.

Schmitz: How should Europe respond to it?

Soros: It needs to be more united, especially in response to Russian aggression in Ukraine. Putin prides himself on being a geopolitical realist. He respects strength and is emboldened by weakness. Yet there is no need to be permanently adversarial. Notwithstanding the current situation in Ukraine, the European Union and Russia are in many ways complementary; they both need each other. There is plenty of room for Russia to play a constructive role in the world, exactly because both Europe and the United States are so preoccupied with their internal problems.

Schmitz: How does that translate into practice, particularly in the Middle East?

Soros: It has totally transformed the geopolitical situation. I have some specific ideas on this subject, but it is very complicated. I can’t possibly explain it in full because there are too many countries involved and they are all interconnected.

Schmitz: Give it a try.

Soros: I should start with a general observation. There are a growing number of unresolved political crises in the world. That is a symptom of a breakdown in global governance. We have a very rudimentary system in place. Basically, there is only one international institution of hard power: the UN Security Council. If the five permanent members agree, they can impose their will on any part of the world. But there are many sovereign states with armies; and there are failed states that are unable to protect their monopoly over the use of lethal force or hard power.

The cold war was a stable system. The two superpowers were stalemated by the threat of mutually assured destruction, and they had to restrain their satellites. So wars were fought mainly at the edges. After the collapse of the Soviet Union, there was a brief moment when the United States emerged as the undisputed leader of the world. But it abused its power. Under the influence of the neocons, who argued that the United States should use its power to impose its will on the world, President George W. Bush declared “war on terror” and invaded Iraq under false pretenses.

That was a tragic misinterpretation of the proper role of hegemonic or imperial power. It is the power of attraction—soft power—that ensures the stability of empires. Hard power may be needed for conquest and self-protection, but the hegemon must look after the interests of those who depend on it in order to secure their allegiance instead of promoting only its own interests. The United States did that very well after World War II, when it established the United Nations and embarked on the Marshall Plan. But President Bush forgot that lesson and destroyed American supremacy in no time. The neocons’ dream of a “new American century” lasted less than ten years. President Obama then brought American policy back to reality. His record in foreign policy is better than generally recognized. He accepted the tremendous loss of power and influence and tried to “lead from behind.” In any case, he is more preoccupied with domestic than foreign policy. In that respect America is in the same position as Europe, although for different reasons. People are inward-looking and tired of war. This has created a power vacuum, which has allowed conflicts to fester unresolved all over the world.

Recently, Russia has moved into this power vacuum, trying to reassert itself as a geopolitical player. That was a bold maneuver, inspired by Putin’s internal weakness, and it has paid off in Syria because of the weakness of the West. Russia could do what the Western powers couldn’t: persuade Assad to “voluntarily” surrender his chemical weapons. That has radically changed the geopolitical landscape. Suddenly, the prospect of a solution has emerged for the three major unresolved conflicts in the Middle East—Palestine, Iran, and Syria—when one would have least expected it.

by George Soros and Gregor Peter Schmitz, NY Review of Books | Read more:
Image: Maxim Shemetov/Reuters

IBM to Set Watson Loose on Cancer Genome Data


Earlier today, IBM announced that it would be using Watson, the system that famously wiped the floor with human Jeopardy champions, to tackle a somewhat more significant problem: choosing treatments for cancer. In the process, the company hopes to help usher in the promised era of personalized medicine.

The announcement was made at the headquarters of IBM's partner in this effort, the New York Genome Center; its CEO, Robert Darnell called the program "not purely clinical and not purely research." Rather than seeking to gather new data about the mutations that drive cancer, the effort will attempt to determine if Watson can parse genome data and use it to recommend treatments.

Darnell said that the project would start with 20 to 25 patients who are suffering from glioblastoma, a type of brain cancer with a poor prognosis. Currently, the median survival time after diagnosis is only 14 months; "Time, frankly, is not your friend when you have glioblastoma," as Darnell put it. Samples from those patients (including both healthy and cancerous tissue) would be subjected to extensive DNA sequencing, including both the genome and the RNA transcribed from it. "What comes out is an absolute gusher of information," he said.

It should theoretically be possible to analyze that data and use it to customize a treatment that targets the specific mutations present in tumor cells. But right now, doing so requires a squad of highly trained geneticists, genomics experts, and clinicians. It's a situation that Darnell said simply can't scale to handle the patients with glioblastoma, much less other cancers.

Instead, that gusher of information is going to be pointed at Watson. John Kelly of IBM Research stepped up to describe Watson as a "cognitive system," one that "mimics the capabilities of the human mind—some, but not all [capabilities]." The capabilities it does have include ingesting large volumes of information, identifying the information that's relevant, and then learning from the results of its use. Kelley was extremely optimistic that Watson could bring new insights to cancer care. "We will have an impact on cancer and these other horrific diseases," he told the audience. "It's not a matter of if, it's a matter of when—and the when is going to be very soon."

by John Timmer, ARS Technica |  Read more:
Image: IBM

Friday, March 21, 2014

Monk


Thelonious Monk
[ed. Caravan]

Anita Hill

[ed. See also: Clarence Thomas's Disgraceful Silence]

It's been more than 22 years since Anita Hill sat before the Senate Judiciary Committee in that famous bright blue suit - one she could never bring herself to wear again - to make the sexual harassment allegations against Clarence Thomas that transfixed a nation.

And much has changed since then.

But not everything.

"I hope you rot in hell," went an email that Hill, now 57 and a professor at Brandeis University, received just a few weeks ago from a member of the public.

After all this time?

"Yes," Hill says, with a resigned air. "As they go, this one was fairly mild. But it happens. And it'll happen again."

Especially now. The soft-spoken Hill, who still speaks in the same calm, precise tone many remember from 1991, has for two decades been living a quiet academic life, occasionally venturing out to speak about sexual harassment but often declining interviews.

But she's about to enter the maelstrom again with the release Friday of a new documentary, "Anita," by the Oscar-winning filmmaker Freida Mock. After years of declining requests to collaborate on a film about her experiences, she said yes.

Why now?

Hill says she was inspired by the reactions she was getting from people as the 20th anniversary of those Supreme Court confirmation hearings approached - particularly in 2010, when news broke that she'd received a voice mail from Thomas' wife, Virginia, asking Hill to "consider an apology." (That voice mail opens the film.)

"People responded with outrage to that," Hill says. "But even more, I realized that here we are 20 years later and the issues are still resonating - in the workplace, in universities, in the military. So if 1991 could help us start a conversation, how then can we move this to another level? Because clearly we haven't eliminated the problem."

Experts agree the problem surely hasn't been eliminated. But many cite Hill's testimony as a landmark event, in both social and legal terms.

"Back then, this was an invisible issue, until Anita testified," says Marcia D. Greenberger, founder and co-president of the National Women's Law Center. Not only did Hill's testimony raise public consciousness about sexual harassment in the workplace, she says, and spur other women to make claims, but only months later, the Civil Rights Act of 1991, which addressed issues of employment discrimination, was passed with strong support.

"That happened in direct response to the growing realization of what the American public had seen in the hearings," Greenberger contends.

It's clear that Hill became, and remains, a heroine to many women. It's also clear that while she doesn't reject it, she remains somewhat uncomfortable with the status. In an interview at a Manhattan hotel, she seems almost more excited to discuss her work preparing a strategic plan for Brandeis than her public persona.

"In some ways I'm not very well suited, I think, for that position of heroine," she says. "People do want that person who is sort of out there and vocal and adamant about who they are and what they want. But I wouldn't be credible if I didn't come to this with my own personality."

Hill says that in her day-to-day life, "1991 just doesn't figure in." Case in point: At Brandeis, many of her students don't even know about her past. Hill points out that her grad students were only children in 1991, and the undergrads weren't even born.

"It doesn't bother me," she says. "It's important to help them focus on what their learning objectives are, and not on me as a person."

by Jocelyn Noveck, AP |  Read more:
Image: Greg Gibson

Thursday, March 20, 2014


Joan Miró, Maternity, 1924
via:

Linda Ronstadt

Dear Abby (Polly) on Steroids

Dear Polly,

The amazing man I'm with told me to improve my looks when we first got together. We've been together four years now. Here's the story:

When he first met me, he had fallen for me straight away, always coming in for coffee on my shift at the local cafe, always texting first, offering rides home, asking me out first. He was very sweet and persistent.

I was hooked and I said yes, yes I will be your girlfriend. Then some shit started…

He never complimented me on any of my physical traits, yet every weekend we hung out, he would somehow manage to tell me that he wanted me to have larger breasts like so-and-so, get more toned legs like this person, grow your hair long and put on some eye shadow…. A lot of similar things were said over and over for probably the first six months of our relationship. I think I didn't confront him for so long because I really liked him otherwise. I was also only 20 at the time and really wanted this relationship to work.

I was incredibly hurt every time but I held my disappointment and devastation inside. Then one day, I was mad enough to confront him. I told him that what he was saying was downright hurtful and that he shouldn't be with me if all he can think of is improving me and making me more like other women he probably desired.

He was completely shocked at my confrontation as if he didn't realize he was hurting me. Right after that he never compared me to anyone again, he even started complimenting me and saying that I was the most beautiful woman in the world to him.

I usually tell him to drop it with the comments because I don't believe him. It annoys the hell out of me that he always tries to overcompensate.

You might be wondering why I stay with him? Well, he's WONDERFUL. He does dishes, takes out garbage, is kind and thoughtful. He always wants to buy me anything and everything I want, even though he can't cause we're not rich, but he always tries his best. He listens to me and is interested in my life. He supports my goals and dreams and always believes in me when other people do not. He is faithful and compassionate. It's difficult to leave such a lovely package.

My theory for his actions at the beginning of the relationship is that, he was just being completely honest, without any thought for consequence. On the very downside, his ridiculously honest comments at the beginning of the relationship have given my self-esteem a beating. Sometimes during sex I feel inadequate cause I know I don't look a certain way.

BUT… why oh why did he say such cruel things and then try to over-compensate??? It is very very annoying.

AND HERE'S THE TWIST. The other night he decided to compliment me. I got mad and started saying he has been lying all these years. And then… he admitted that he had been!

He said that I am not the most beautiful woman to him. He was just trying to make me feel better and mend the wound.

WHAT THE FUCK. Why go through all the trouble of lying just to tell the truth? Sigh. I am pretty relieved to finally hear the truth. Because I always knew.

Now I don't know what to do, I've been largely ignoring this issue, sweeping it under the rug.

I would love some straightforward advice. I want to know if it's worth it to stay with a man who didn't really want me for who I was physically. I know relationships are not based on physical attraction. But do you think his actions have been unreasonable? I feel hurt and kind of ugly. Should I completely forgive him and keep focusing on the positives of our relationship?

He has since said, "Physically you are an okay, pretty girl, but that's it. Many girls are much hotter than you." I know this is true. I'm glad he can be honest again. But I don't know if I can get over the fact that he lied for sooooo long.

I really don't want you to tell me to follow my heart, and that it's up to me to choose what I do. (Because that's what people have told me.) Please tell me what to do… OR tell me what you would do if you were in my situation now.

Thanks in advance.

Not Hot Enough

by Heather Havrilesky, The Awl | Read more:
Image: Dan DeBold

What I Want to Know Is Why You Hate Porn Stars

Here's what I want to know.

It's an open question to everyone, to my ex-boyfriends, neuroscientists, radical feminists, politicians, people on Twitter, my friends, myself.

What is it about porn stars that bothers you so much?

Why do you hate us?

What is it about us that you don't like? (...)

"Food porn" is pictures of food you love eating.

"Wedding porn" is pictures of lavish dresses, table settings, cakes.

"Science porn" is pictures of the natural world or how-things-work charts.

There's skater porn (videos of skateboarders doing daring tricks on stairways and in parking lots), book porn (images of huge libraries and bookstores), fashion porn (photos of outrageously ornamental outfits). There's even Christian missionary porn (pics of missionaries helping the poor).

People love using the word "porn" as long as there's a partner for it. Pair "porn" with something else and it's usually a good thing. A celebration of style and culture. But that word on its own? Well.

by Conner Habib, The Stranger |  Read more:
Image: Paccarik Orue

Parents, Leave Those Kids Alone


It’s still morning, but someone has already started a fire in the tin drum in the corner, perhaps because it’s late fall and wet-cold, or more likely because the kids here love to start fires. Three boys lounge in the only unbroken chairs around it; they are the oldest ones here, so no one complains. One of them turns on the radio—Shaggy is playing (Honey came in and she caught me red-handed, creeping with the girl next door)—as the others feel in their pockets to make sure the candy bars and soda cans are still there. Nearby, a couple of boys are doing mad flips on a stack of filthy mattresses, which makes a fine trampoline. At the other end of the playground, a dozen or so of the younger kids dart in and out of large structures made up of wooden pallets stacked on top of one another. Occasionally a group knocks down a few pallets—just for the fun of it, or to build some new kind of slide or fort or unnamed structure. Come tomorrow and the Land might have a whole new topography.

Other than some walls lit up with graffiti, there are no bright colors, or anything else that belongs to the usual playground landscape: no shiny metal slide topped by a red steering wheel or a tic-tac-toe board; no yellow seesaw with a central ballast to make sure no one falls off; no rubber bucket swing for babies. There is, however, a frayed rope swing that carries you over the creek and deposits you on the other side, if you can make it that far (otherwise it deposits you in the creek). The actual children’s toys (a tiny stuffed elephant, a soiled Winnie the Pooh) are ignored, one facedown in the mud, the other sitting behind a green plastic chair. On this day, the kids seem excited by a walker that was donated by one of the elderly neighbors and is repurposed, at different moments, as a scooter, a jail cell, and a gymnastics bar.

The Land is an “adventure playground,” although that term is maybe a little too reminiscent of theme parks to capture the vibe. In the U.K., such playgrounds arose and became popular in the 1940s, as a result of the efforts of Lady Marjory Allen of Hurtwood, a landscape architect and children’s advocate. Allen was disappointed by what she described in a documentary as “asphalt square” playgrounds with “a few pieces of mechanical equipment.” She wanted to design playgrounds with loose parts that kids could move around and manipulate, to create their own makeshift structures. But more important, she wanted to encourage a “free and permissive atmosphere” with as little adult supervision as possible. The idea was that kids should face what to them seem like “really dangerous risks” and then conquer them alone. That, she said, is what builds self-confidence and courage. (...)

If a 10-year-old lit a fire at an American playground, someone would call the police and the kid would be taken for counseling. At the Land, spontaneous fires are a frequent occurrence. The park is staffed by professionally trained “playworkers,” who keep a close eye on the kids but don’t intervene all that much. Claire Griffiths, the manager of the Land, describes her job as “loitering with intent.” Although the playworkers almost never stop the kids from what they’re doing, before the playground had even opened they’d filled binders with “risk benefits assessments” for nearly every activity. (In the two years since it opened, no one has been injured outside of the occasional scraped knee.) Here’s the list of benefits for fire: “It can be a social experience to sit around with friends, make friends, to sing songs to dance around, to stare at, it can be a co-operative experience where everyone has jobs. It can be something to experiment with, to take risks, to test its properties, its heat, its power, to re-live our evolutionary past.” The risks? “Burns from fire or fire pit” and “children accidentally burning each other with flaming cardboard or wood.” In this case, the benefits win, because a playworker is always nearby, watching for impending accidents but otherwise letting the children figure out lessons about fire on their own.  (...)

Like most parents my age, I have memories of childhood so different from the way my children are growing up that sometimes I think I might be making them up, or at least exaggerating them. I grew up on a block of nearly identical six-story apartment buildings in Queens, New York. In my elementary-school years, my friends and I spent a lot of afternoons playing cops and robbers in two interconnected apartment garages, after we discovered a door between them that we could pry open. Once, when I was about 9, my friend Kim and I “locked” a bunch of younger kids in an imaginary jail behind a low gate. Then Kim and I got hungry and walked over to Alba’s pizzeria a few blocks away and forgot all about them. When we got back an hour later, they were still standing in the same spot. They never hopped over the gate, even though they easily could have; their parents never came looking for them, and no one expected them to. A couple of them were pretty upset, but back then, the code between kids ruled. We’d told them they were in jail, so they stayed in jail until we let them out. A parent’s opinion on their term of incarceration would have been irrelevant.

I used to puzzle over a particular statistic that routinely comes up in articles about time use: even though women work vastly more hours now than they did in the 1970s, mothers—and fathers—of all income levels spend much more time with their children than they used to. This seemed impossible to me until recently, when I began to think about my own life. My mother didn’t work all that much when I was younger, but she didn’t spend vast amounts of time with me, either. She didn’t arrange my playdates or drive me to swimming lessons or introduce me to cool music she liked. On weekdays after school she just expected me to show up for dinner; on weekends I barely saw her at all. I, on the other hand, might easily spend every waking Saturday hour with one if not all three of my children, taking one to a soccer game, the second to a theater program, the third to a friend’s house, or just hanging out with them at home. When my daughter was about 10, my husband suddenly realized that in her whole life, she had probably not spent more than 10 minutes unsupervised by an adult. Not 10 minutes in 10 years.

It’s hard to absorb how much childhood norms have shifted in just one generation. Actions that would have been considered paranoid in the ’70s—walking third-graders to school, forbidding your kid to play ball in the street, going down the slide with your child in your lap—are now routine. In fact, they are the markers of good, responsible parenting. One very thorough study of “children’s independent mobility,” conducted in urban, suburban, and rural neighborhoods in the U.K., shows that in 1971, 80 percent of third-graders walked to school alone. By 1990, that measure had dropped to 9 percent, and now it’s even lower. When you ask parents why they are more protective than their parents were, they might answer that the world is more dangerous than it was when they were growing up. But this isn’t true, or at least not in the way that we think. For example, parents now routinely tell their children never to talk to strangers, even though all available evidence suggests that children have about the same (very slim) chance of being abducted by a stranger as they did a generation ago. Maybe the real question is, how did these fears come to have such a hold over us? And what have our children lost—and gained—as we’ve succumbed to them?

by Hanna Rosin, The Atlantic |  Read more:
Image: Hanna Rosin

Wednesday, March 19, 2014

Ban Tipping

As a person who writes about food and drink for a living, I couldn’t tell you the first thing about Bill Perry or whether the beers he sells are that great. But I can tell you that months before opening The Public Option, a brewpub in Washington DC, the man has already landed in my good graces. That’s because he plans to ban tipping in favor of paying his servers an actual living wage. Bill Perry might just be the most progressive thing going in Washington right now.

I hate tipping.

I hate it because it’s an obligation masquerading as an option, and a bizarre singling-out of one person’s compensation, just dangling there, clumsily, outside the cost of my meal. I hate it for the postprandial math it requires of me. But mostly, I hate tipping because I believe that I would be in a better place – as a diner, and as a human – if pay decisions regarding employees were simply left up to their employers, as is the custom in virtually every other industry, in pretty much every civilized corner of the earth.

Most of you think that you hate to tip, too. The research suggests otherwise. You actually love tipping! You like to feel that you have a voice in how much money your server makes. No matter how the math works out, you persistently view restaurants with voluntary tipping systems as being a better value.

This makes it extremely difficult for restaurants and bars to do away with the tipping system. Which is a shame, really, because tipping deserves to go the way of the zeppelin, pantaloons and Creationism. We should know better by now.

by Elizabeth Gunnison Dunn, The Guardian | Read more:
Image: Francois Lenoir / Reuters

[ed. Enjoy your day.]

Pixel and Dimed


The gig economy (a phrase which encompasses both the related collaborative economy and sharing economy) represents a theory of the future of work that's a viable alternative to laboring for corporate America. Instead of selling your soul to the Man, it goes, you are empowered to work for yourself on a project-by-project basis. One day it might be delivering milk, but the next it's building Ikea furniture, driving someone to the airport, hosting a stranger from out of town in your spare bedroom, or teaching a class on a topic in which you're an expert. The best part? The work will come to you, via apps on your smartphone, making the process of finding work as easy as checking your Twitter feed.

Whatever you do, it will be your choice. Because you are no longer just an employee with set hours and wages working to make someone else rich. In the future, you will be your very own mini-business. (...)

The only way to find out whether the tech world's solution for the poor job market and income inequality had the answer was to put it to the test. For four weeks this winter, spread out over a six-week period to avoid the holidays, I hustled for work in the gig economy. Technically I was undercover, but I used my real name and background, and whenever asked, I readily shared that I was a journalist. (Alas, people were all too willing to accept that a writer was a perfect candidate for alternative sources of income.) I have changed the names of anyone who did not know, when I was speaking to them, that I was working on this story.

I decided that I would accept any gigs I could get my hands on in pursuit of my goal: I would use the slick technology and shimmering promise of the Silicon Valley-created gig economy to beat Capitol Hill's $10.10 per hour proposal. How hard could it be?

by Sarah Kessler, Fast Company |  Read more:
Image: Fast Company

The Great Corporate Cash-Hoarding Crisis

A troubling change is taking place in American business, one that explains why nearly five years after the Great Recession officially ended so many people cannot find work and the economy remains frail.

The biggest American corporations are reporting record profits, official data shows. But the companies are not investing their windfalls in business expansion, which would mean jobs. Nor are they paying profits out to shareholders as dividends.

Instead, the biggest companies are putting profits into the corporate equivalent of a mattress. They are hoarding what just a few years ago would have been considered unimaginable pools of cash and buying risk-free securities that can be instantly converted to cash, which together are known in accounting parlance as liquid assets.

This is just one of many signs that America’s chief executive officers, chief financial officers and corporate boards are behaving fearfully. They are comparable to the slothful servant in the biblical parable of the talents who buries a fortune in the ground rather than invest it. Their caution, aided by government policy, costs all of us. (...)

My analysis of the latest data from the Federal Reserve, the IRS and corporate reports shows that American businesses last year held almost $7.9 trillion of liquid assets worldwide.

Those who follow the news may be surprised, because the figure that’s been mentioned lately has been just under $2 billion. That figure, which comes from the Federal Reserve, is only for domestic cash. The Fed makes its calculations (from the latest Flow of Funds report) using IRS worldwide data after subtracting offshore money.

My estimate is conservative. I did not count cash due to American companies from their offshore subsidiaries as accounts receivable because the IRS does not provide fine details on these additional trillions of dollars.  (...)

Turning taxes into profit

These facts also demonstrate that America’s CEOs, chief financial officers and corporate boards fear the future because instead of investing their cash they hold onto it. But even if cash hoarding comforts weak-kneed executives, it makes no sense for investors, workers or taxpayers.

Investors do not need a company to hold their extra cash. That’s what savings accounts are for.

Workers need companies to invest in the future, replacing old factories, purchasing new equipment and engaging in other activities that employ people in pursuit of bigger future profits.

Taxpayers also get a terrible deal. When companies siphon cash out of the country it reduces their immediate federal income taxes. Congress spends the money anyway, which requires borrowing. Companies then loan Washington the money they did not pay in taxes, collecting interest.

This means companies that do this turn a profit on their taxes. Consider a company that defers a $1 billion tax for 30 years, using the cash to buy federal debt paying 4 percent interest in an era of 3 percent inflation. The company will collect more than $2.2 billion in interest, while inflation will erode the value of the tax to $401 million, a nearly 60 percent reduction. From the government’s point of view the tax is converted from a source of revenue into an expense.

by David Cay Johnston, Aljazeera America |  Read more:
Image: Comstock/Thinkstock

End of the day
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