Tax Havens in Context

Oct 27, 2009 Allison Christians

Craig Boise and Andrew Morriss have produced a fascinating account of the emergence and role of the offshore financial sector with this case study of the Netherlands Antilles—once a powerhouse, now struggling to stay alive in the global economy.  With places like the Antilles again in the political and media spotlight, cast in their now-familiar role as renegades in international society, I have long thought we were overdue for an account that carefully considers the view from these countries and provides the context we critically need to understand the dynamics between tax competition and economic development.  This article may well be the most accessible account of the complicated history that shaped U.S. policy toward a growing number of tiny islands with tiny populations and limited opportunities for economic vitality.

It is certainly the most thorough and thoughtful analysis I have encountered on the topic of why “tax havens” exist.  Boise and Morriss bring us on a lively tour through the history of the Antilles and its complicated relationship with the United States.  They use first-hand accounts and historical research to build a narrative that is decidedly different than the story usually told by those who emphasize the need for crackdown when cooperation cannot yield a mutually beneficial result.  For instance, it may surprise readers to learn that the rise of the Antilles as an offshore financial center occurred not as opportunistic banditry but as the result of a serendipitous confluence of factors, all of which served goals other than facilitating tax evasion.  You will have to read the paper to find out how the Antilles met a dire need for asset protection during World War II, and how it facilitated American access to the Eurobond markets at a time when the United States depended heavily on foreign borrowing for its economic success.  You will also need to read this paper to see why the crackdown on places like the Antilles will likely be as futile as it is harmful to the populations whose livelihood depends on their ability to facilitate transactions in the global economy.

Readers will no doubt be unsympathetic to tax havens, and certainly to tax evaders—I am certainly no fan of Bono, the Rolling Stones, or any other person or group that prefers not to contribute to the social orders that make their fortune possible.  But this paper shows that the problem of tax evasion cannot plausibly be viewed as simply a collective action problem that could be solved by universal adherence to norms that would “level” the tax competition playing field, as envisioned in places like the OECD.  Once it is clear that the benefit of eliminating tax havens goes only to the world’s wealthiest countries, we may be less inclined to sit in moral judgment of nations that rely on their financial services industries for their economic survival.

You should read this paper if you want to understand what it is that offshore financial sectors offer to American and other investors and what role the United States and other developed countries play in ensuring that tax havens will always exist (even as the message to the public declares otherwise). You may come away from the paper with a little less enthusiasm than the authors for the regulatory tactics employed by these islands, but we could all do better to understand the context of the problems we face in a world of bound sovereigns but footloose capital.  I highly recommend this article and hope that it becomes required reading for anyone who takes seriously the dual issues of global tax evasion and disparate economic development.

Meet the Editors

Oct 26, 2009 Michael Froomkin

Section Editors

The Section Editors choose the Contributing Editors and exercise editorial control over their section.  In addition, each Section Editor will write at least one contribution (“jot”) per year.  Questions about contributing to a section ought usually to be addressed to the section editors.

Professor Alison Christians
University of Wisconsin School of Law

Professor George Mundstock
University of Miami School of Law

Contributing Editors

Contributing Editors agree to write at least one jot for Jotwell each year.

Professor Craig M. Boise
Associate Director of the Center for Business Law & Regulation, DePaul University College of Law

Professor Kimberley Ruth Brooks
H. Heward Stikeman Chair in the Law of Taxation,  McGill University, Faculty of Law

Professor Neil H. Buchanan
The George Washington University Law School

Professor Charlotte Crane
Northwestern University School of Law

Professor Michael A. Livingston
Rutgers School of Law – Camden

Professor Diane Ring
Boston College Law School

Professor Donald B. Tobin
Associate Dean for Faculty, Frank E. and Virginia H. Bazler Designated Professor in Business Law, The Ohio State University, Moritz College of Law

Call For Papers

Oct 25, 2009 Michael Froomkin

Jotwell: The Journal of Things We Like (Lots) seeks short reviews of (very) recent scholarship related to the law that the reviewer likes and thinks deserves a wide audience. The ideal Jotwell review will not merely celebrate scholarly achievement, but situate it in the context of other scholarship in a manner that explains to both specialists and non-specialists why the work is important.

Although critique is welcome, reviewers should choose the subjects they write about with an eye toward identifying and celebrating work that makes an original contribution, and that will be of interest to others. First-time contributors may wish to consult the Jotwell Mission Statement for more information about what Jotwell seeks, and what it seeks to achieve.

Reviews need not be written in a particularly formal manner. Contributors should feel free to write in a manner that will be understandable to scholars, practitioners, and even non-lawyers.

Ordinarily, a Jotwell contribution will

• be between 500-1000 words;
• focus on one work, ideally a recent article, but a discussion of a recent book is also welcome;
• begin with a hyperlink to the original work — in order to make the conversation as inclusive as possible, there is a strong preference for reviews to focus on scholarly works that can be found online without using a subscription service such as Westlaw or Lexis. That said, reviews of articles that are not freely available online, and also of very recent books, are also welcome.

Initially, Jotwell particularly seeks contributions relating to:

• Administrative Law
• Constitutional Law
• Corporate Law
• Criminal Law
• Cyberlaw
• Intellectual Property Law
• Legal Profession
• Tax Law

We intend to add more sections in the coming months.

References

Authors are responsible for the content and cite-checking of their own articles. Jotwell editors and staff may make editorial suggestions, and may alter the formatting to conform to the house style, but the author remains the final authority on content appearing under his or her name.

• Please keep citations to a minimum.
• Please include a hyperlink, if possible, to any works referenced.
• Textual citations are preferred. Endnotes, with hyperlinks, are allowed if your HTML skills extend that far.
• Authors are welcome to follow The Bluebook: A Uniform System of Citation (18th ed. 2005), or the The Redbook: A Manual on Legal Style (2d Ed.) or indeed to adopt any other citation form which makes it easy to find the work cited.

Technical

Jotwell publishes in HTML, which is a very simple text format and which does not lend itself to footnotes; textual citations are much preferred.

Contributors should email their article, in plain text, in HTML, or in a common wordprocessor format (Open Office, WordPerfect, or Word) to ed.jotwell@gmail.com and we will forward the article to the appropriate Section Editors. Or you may, if you prefer, contact the appropriate Section Editors directly.

Jotwell Mission Statement

Oct 19, 2009 Michael Froomkin1 comment

The Journal of Things We Like (Lots)–JOTWELL–invites you to join us in filling a telling gap in legal scholarship by creating a space where legal academics will go to identify, celebrate, and discuss the best new legal scholarship. Currently there are about 350 law reviews in North America, not to mention relevant journals in related disciplines, foreign publications, and new online pre-print services such as SSRN and BePress. Never in legal publishing have so many written so much, and never has it been harder to figure out what to read, both inside and especially outside one’s own specialization. Perhaps if legal academics were more given to writing (and valuing) review essays, this problem would be less serious. But that is not, in the main, our style.

We in the legal academy value originality. We celebrate the new. And, whether we admit it or not, we also value incisiveness. An essay deconstructing, distinguishing, or even dismembering another’s theory is much more likely to be published, not to mention valued, than one which focuses mainly on praising the work of others. Books may be reviewed, but articles are responded to; and any writer of a response understands that his job is to do more than simply agree.

Most of us are able to keep abreast of our fields, but it is increasingly hard to know what we should be reading in related areas. It is nearly impossible to situate oneself in other fields that may be of interest but cannot be the major focus of our attention.

A small number of major law journals once served as the gatekeepers of legitimacy and, in so doing, signaled what was important. To be published in Harvard or Yale or other comparable journals was to enjoy an imprimatur that commanded attention; to read, or at least scan, those journals was due diligence that one was keeping up with developments in legal thinking and theory. The elite journals still have importance – something in Harvard is likely to get it and its author noticed. However, a focus on those few most-cited journals alone was never enough, and it certainly is not adequate today. Great articles appear in relatively obscure places. (And odd things sometimes find their way into major journals.) Plus, legal publishing has been both fragmented and democratized: specialty journals, faculty peer reviewed journals, interdisciplinary journals, all now play important roles in the intellectual ecology.

The Michigan Law Review publishes a useful annual review of new law books, but there’s nothing comparable for legal articles, some of which are almost as long as books (or are future books). Today, new intermediaries, notably subject-oriented legal blogs, provide useful if sometimes erratic notices and observations regarding the very latest scholarship. But there’s still a gap: other than asking the right person, there’s no easy and obvious way to find out what’s new, important, and interesting in most areas of the law.

Jotwell will help fill that gap. We will not be afraid to be laudatory, nor will we give points for scoring them. Rather, we will challenge ourselves and our colleagues to share their wisdom and be generous with their praise. We will be positive without apology.

Tell us what we ought to read!

How It Works

Jotwell will be organized in sections, each reflecting a subject area of legal specialization. Each section, with its own url of the form sectionname.jotwell.com, will be managed by a pair of Section Editors who will have independent editorial control over that section. The Section Editors will also be responsible for selecting a team of ten or more Contributing Editors. Each of these editors will commit to writing at least one Jotwell essay of 500-1000 words per year in which they identify and explain the significance of one or more significant recent works – preferably an article accessible online, but we won’t be doctrinaire about it. Our aim is to have at least one contribution appear in each section on a fixed day every month, although we won’t object to more. Section Editors will also be responsible for approving unsolicited essays for publication. Our initial sections will cover administrative law, constitutional law, corporate law, criminal law, cyberlaw, intellectual property law, legal profession, and tax law — and we intend to add new sections when there is interest in doing so.

For the legal omnivore, the ‘front page’ at Jotwell.com will contain the first part of every essay appearing elsewhere on the site. Links will take you to the full version in the individual sections. There, articles will be open to comments from readers.

The Details

Learn more about Jotwell:

• Style guide
• Acceptable use policy
• Copyright Policy
• Privacy policy