Regulatory Competition Leads to Better Policy in France

The Financial Times reports that France is deregulating and cutting taxes in hopes of competing with London in the financial services market. The article also notes that Switzerland and Germany also are trying to attract business by reducing the burden of government. Needless to say, these positive reforms would not happen if the bureaucrats in Brussels had the authority to create a continent-wide regulatory regime. Another threat to deregulation and better policy is IOSCO (the International Organization of Securities Commissions), which wants to impose one-size-fits-all regulation on all jurisdictions - particularly ones with a more laissez-faire approach:

The French government yesterday unveiled its plans to boost Paris as a financial centre, proposing a more lightly regulated market for companies and funds on the Euronext exchange. Several of the measures are closely modelled on UK structures, as the French capital seeks to make up ground lost to London. The new market segment would operate according to European Union minimum standards in terms of listing and disclosure. …Switzerland’s leading financial services companies launched their own campaign last month for tax cuts, a relaxation of immigration rules and other measures to turn their country into the world’s third largest financial centre after London and New York. Frankfurt launched its own more lightly regulated market segment two years ago… Ms Lagarde said the government had already shown serious commitment to financial services by cutting taxes, particularly for higher earners. France’s high taxation is one reason why so many young French bankers flock to London.

Mississippi Scandal

Several years ago there was a scandal in West Virginia when people discovered that one of the state’s medical examiners, Fred Zane, did sloppy work and just made things up as he was giving so-called “expert testimony” in criminal trials. Radley Balko seems to have uncovered a similar scandal in Mississippi

For more about Radley Balko’s investigative reporting from Mississippi, read this

Edwards’ Budget Law

More evidence that when the government says a project will cost $1, taxpayers will end up paying $2 or more.

The Washington Post notes that Congress is considering further funding of a Navy ship program: ”The congressional action followed months of delays as costs ballooned. The cost for the initial two ships was estimated at about $220 million each but now appear to cost up to double that.”

More on cost overruns here and here.

New at Cato Unbound: Mark Lilla on Religion and Politics

The new issue of Cato Unbound on Religion and Politics, Home and Abroad,” is hot off the electronic presses with this month’s lead essay by Columbia University’s Mark Lilla, author of the new book The Stillborn God: Religion, Politics, and the Modern West. Drawing on themes from his book, Lilla attempts to explain why the United States, the most religious nation in the modern West, can neither understand nor cope with “the religious passions dominating contemporary world politics.” Lilla lays out how the “Great Separation” in Western political thought, which set aside “political theology” as the basis for conceiving of the legitimacy of the political order, together with the exceptional American experience of religious toleration, has made it difficult for Americans to grasp how uneasily Western ideals of democracy and toleration fit within frameworks of thought that still put God at the center of politics.

Joining Lilla over the next few weeks we will have the prolific Penn State professor of history and religion Philip Jenkins; Damon Linker, author of The Theocons: Secular America Under Siege; and The Atlantic’s Andrew Sullivan, author of recent The Conservative Soul: How We Lost It; How To Get It Back.

Governor Spitzer Gets It Right

In a Cato TechKnowledge newsletter issued today, I’ve updated the world on the status of the REAL ID Act.

One of the more interesting recent developments is the decision by New York Governor Eliot Spitzer to break the link between driver licensing and immigration status. He and the Department of Motor Vehicles commissioner announced the policy September 21st.

De-linking driver licensing and immigration will reduce unlicensed driving, uninsured driving, hit-and-run driving, insurance costs for legal drivers, and roadway injuries. Linking driving and immigration status is a requirement of REAL ID, and Spitzer’s move is another nail in the coffin of this national ID law.

In my TechKnowledge piece, I laud the governor’s action as follows:

Spitzer is not willing to shed the blood of New Yorkers to “take a stand” on immigration, which is not a problem state governments are supposed to solve anyway.It’s a welcome — and somewhat surprising — move, to see a Democrat and law-and-order-type former attorney general resist mission creep in a state bureau and hold fast to the federal system devised in the constitution. But he’s done the right thing. Thanks most recently to Governor Spitzer, and to state leaders from across the ideological spectrum, REAL ID is in collapse.

The move has subjected Spitzer to withering political attacks from Republicans. The attack most embarassing to witness, though, comes from “relatives of 9/11 victims.”

Creepy Conservatives

Andrew Ferguson at the Weekly Standard provides a pretty accurate portrait of Alan Greenspan, but he seems to have a problem with libertarians.

Ferguson labels Ayn Rand’s philosophy ”creepy” for “placing the self at the center of the moral universe.” Where would such a crazy idea come from?

Well, we do know that all men are “…endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men…”

Ah hah. It was the Creator that put individual lives at the center of the moral universe. That’s why he endowed us with unalienable rights. And because pursuing one’s own life and happiness is moral, Americans build their government around the idea.

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Hong Kong’s Flat Tax May Drop to 15 Percent

Thanks in part to tax competition from Singapore, Hong Kong is on the verge of reducing the flat tax rate on both corporate and labor income to 15 percent. The Wall Street Journal notes  ($) - or at least hopes - that this might open some eyes in the US and UK:

Chief Executive Donald Tsang delivers the first policy speech of his new term on Wednesday and it promises to make instructive reading for lawmakers elsewhere in the world who want to make their economies competitive. Mr. Tsang’s move was mooted earlier this year, when he promised to cut taxes on both salaries and corporate profits to 15% during his next term. The salaries tax currently stands at 16% and the profits tax at 17.5%. On Friday, the South China Morning Post reported he’ll start the ball rolling this week, sooner in his term rather than later. Singapore, Hong Kong’s big competitor in the region, has been steadily cutting corporate taxes over the past few years. Its rate now stands at 18%. …In the race to attract new business, New York and London are competing against a territory that thinks a 17.5% corporate tax is too high.