Digital Cabinet

Polevaulter Donkeyman's rants, raves musings and flame wars

Posts Tagged ‘public choice

Dear New York Times, You Need to Try Harder

leave a comment »

From a New York Times article on the staggering wealth generated by casinos run by the Shakopee Mdewakanton Indian tribe in Minnesota:

Alan Meister, an economist who compiles tribal gambling data, said Minnesota’s 18 tribal casinos earned a combined $1.4 billion in 2010, although the Shakopees’ portion of that is unclear. But even if the tribe accounted for nearly the entire $1.4 billion, its philanthropy would compare well with corporations, even though the tribe receives no tax write-offs for giving.

For example, the tribe’s $28.5 million in charitable cash contributions in 2010 was more than those of several Minneapolis-area Fortune 500 companies, including the 3M Corporation, which had 2010 revenue of $23 billion, and U.S. Bancorp, which had $19.5 billion in revenue in 2010, according to the Minnesota Council on Foundations.

The New York Times of course fails to mention:

Indian tribal businesses do pay a wide variety of taxes, including taxes on wagering, occupational taxes, and employment taxes. For federal income tax purposes, however, Indian tribes are governmental entities and, as such, are not required to pay taxes on the income generated by the Indian tribes, including income generated by commercial activities.

State governments have no control or authority over Indian tribes unless specifically authorized by Congress.
  • In 2011, 3M was on the hook for USD 1.674 B (USD 331 M deferred) in corporate income tax.


The NYT does though thankfully concede:

tribal facilities do not pay direct state taxes because of the tribes’ status as sovereign nations.


And why have the Shakopee Mdewakanton been so spectacularly successful? From the NYT article

The primary anxiety is competing casinos being hurriedly opened by states in pursuit of new revenue. But more menacing, tribes say, is a sophisticated and growing movement to legalize Internet gambling under state laws that would give those states the potential power to regulate and tax online gambling even on reservations.


Monopoly profits being made due to laws which previously banned internet gambling and restricted casinos? Somehow I don’t have much sympathy for the Indian casinos.


Written by Polevaulter Donkeyman

August 13, 2012 at 20:20

Your Lobbying Bad, My Lobbying Not … So Bad?

leave a comment »

Tamasin Cave, of the Alliance for Lobbying Transparency on the Today in Parliament for March 2, 2012:


Note:

  1. Tamasin Cave neatly sidesteps the lobbying by the BMA and the Royal College of Nursing
  2. Ms. Cave correctly points out the first order relationship between the lobbying for NHS reforms and the size of the NHS budget (around 100 B GBP).
  3. However Ms. Cave then fails to see the second-order relationship i.e. lobbying is directly related to and caused by the power of the government to grant special favours. As long as government has the power to dispense such special favours, groups will continue to lobby it.
  4. If you want to reduce lobbying, if you want to control it, then reduce the power and size of the government to dole out special favours.


Because of the enormous benefits that can be won from the political process, it is rational for interest groups to spend large sums on lobbying for special privileges – an activity known as ‘rent seeking’.[1]

[1] Butler, E., Public Choice — A Primer, The Institute of Economic Affairs, 2012, p. 16

Why Yes Minister is vastly superior to The West Wing

leave a comment »

From the BBC Radio 4 Documentary of the Week of March 2, 2012

Read the rest of this entry »