H/T to John Farrier for the link.
June 7, 2013
The world’s longest undefended “no touching zone”
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May 30, 2013
May 18, 2013
The micro-state of Sealand
Thomas Hodgkinson reports on his week-long visit to the tiny nation of Sealand:
Seven miles off the coast of Suffolk, there is a country. It isn’t a very big country. In fact, its surface area extends to no more than 6,000 square feet, which is about twice the size of a tennis court. You won’t find it on Google Maps and it isn’t a member of Nato or, indeed, the EU. But it exists. And I know, because I’ve been there.
[. . .]
The reason for this suspicion of strangers in general lies in the violent, picaresque nature of its past. Sealand was built in 1943 by the Royal Navy as an anti-aircraft fortress designed to shoot down Luftwaffe planes. In those days it was equipped with two 94mm Vickers heavy anti-aircraft guns and two 40mm Bofors light anti-aircraft guns, and manned by 120 seamen crammed into accommodation in the hollow concrete towers. It was known as HM Fort Roughs, or Roughs Tower for short. Abandoned after the War, it gathered rust and guano, a gloomy relic of conflict, until the era of pirate radio in the 1960s.
Then two rival entrepreneurs competed for possession, regarding the fort as the perfect place (since it was outside the three-mile zone that then constituted British territorial waters) from which to broadcast pop music to a grateful generation of teenagers. The piratical pair were the long-haired Irish chancer Ronan O’Rahilly, of Radio Caroline fame, and one Roy Bates, a cravat-wearing former Army major.
Each time one of them put men on Roughs Tower, the other would send people to eject them, sometimes forcibly. It was a question of who was prepared to go further, and the answer turned out to be the Englishman. For Bates, the solitary fortress became far more than a radio project. It became an obsession that would absorb not only his life, but also the lives of his wife and children.
The key thing, he knew, was to maintain a presence. With even one occupant, Roughs Tower was tough to take. But Roy couldn’t afford a guard, so instead he plucked his 14-year-old son Michael out of school and put him up there, sometimes with his daughter Penny, sometimes with his wife Joan. For Michael, this was a welcome escape from the dreary rigours of a public-school education, but as he confided to me during a long lunch on-shore after my visit, “I expected it to last six months, not 40-something years”.
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May 4, 2013
Why the terror-through-shipping-container threat has not materialized (yet)
Strategy Page explains why the much-discussed threat of terrorists smuggling in weapons of mass destruction using the ubiquitous shipping container has not actually happened:
A decade ago there was much talk about how vulnerable the United States was to a terror attack via shipping container. It never happened. It’s also unlikely because of the large number of variables the terrorists face. The problems associated with using cargo containers to move a nuclear or conventional bomb are manifold. The big problem is that these containers often don’t arrive right on schedule. Sometimes the ship breaks down or encounters bad weather. This last event leads to thousands of containers a year falling off cargo ships and going to the bottom with their cargo. Sometimes containers get lost “in the system.” More frequently containers get robbed or opened by mistake. Customs officials open a small percentage (this varies by port) for inspection. Another problem, whether the bomb goes off or not, is the fact that containers have to have documentation like bills of lading and such. These can be faked, but the problem is that a paper trail is being created and that can lead to terrorists getting arrested. All containers must officially belong to someone, they are tracked and any that aren’t being tracked tend to get noticed. Many countries do scrutinize containers coming from certain countries in an attempt to catch people smuggling drugs or arms. Large bombs, be they nuclear or conventional, are relatively fragile and may not survive (in working condition) the punishment received during a long sea voyage. If all that weren’t enough to make terrorists nervous, container ships can be delayed when trying to enter a port because of congestion. This can delay arrival by days, or even weeks.
Tax “competition” is a feature, not a bug
At the Adam Smith Institute blog, Tim Worstall explains that Adam Smith was right about conspiracies to raise prices, especially when we look at governments:
Imagine that you don’t like the taxes that are being imposed upon you. No, go on, just imagine. You as an individual voter don’t actually have much influence over this. Which is why that option of exit is so important. The ability to simply say “The hell with you lot” and leave. We should note that there are very definitely some campaigners who insist that that exit route should be closed off. As, largely, it already is for US citizens. They can leave the US, certainly, but find it very difficult indeed to escape the clutches of the IRS.
Mitchell’s also making a very good Smithian point there. It is indeed true that once businessmen have gathered together for that conspiracy against the public then it is indeed competition from alternative suppliers that is said public’s only method of beating the conspiracy. And so it is with government: we can only preserve a modicum of freedom (and a modest portion of our wallet) if we are indeed free to choose among competing providers of those governmental services.
Which is what much of the conspiracy among governments is all about: seeking to deny us that exit, that protection from their monopoly.
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April 24, 2013
More on the currency choices facing an independent Scotland
John Kay works through the short list of options about money that a newly independent Scotland would need to decide about:
Speculation about Scotland’s currency future would begin on the day Scotland voted for independence — or the day on which a poll showed that this result was likely. Scotland would have three main options — the euro, the pound sterling, or its own distinct money.
The euro is the official currency of the EU, and Scotland would in principle be committed to its adoption. But there would be little enthusiasm for that course in either Edinburgh or Brussels, and Scotland — like the UK — would not meet the criteria on debt and deficits for joining the euro. A vague Scottish aspiration to join the single currency at some distant date would probably satisfy everyone.
The sensible outcome would be continued currency union with England — or with the entity that, in deference to Wales and Northern Ireland, participants in the Scottish debate call rUK — rest of UK. Scotland might ask for — and get — a Scottish economist on the Bank of England’s Monetary Policy Committee (not a representative of Scotland — the rules of the committee preclude representative roles). But that would be the extent of Scottish influence on monetary policy.
[. . .]
If I represented the Scottish government in the extensive negotiations required by the creation of an independent state, I would try to secure a monetary union with England, and expect to fail. Given experience in the eurozone, today’s conventional wisdom is that monetary union is feasible only as part of a move towards eventual fiscal union. But desire to break up fiscal union was always a major — perhaps the principal — motive for independence in the first place.
Scotland could continue to use the pound unilaterally, whether the Bank of England liked it or not — as Ecuador uses the dollar and Montenegro the euro. But this is not really an attractive course, and the only countries that have adopted it are those — such as Ecuador and Montenegro — whose monetary histories are so dire that they prefer to entrust their policies to foreigners.
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April 10, 2013
Despite government denials, the iPod duty is alive and well
Expect to pay more for your iPods and similar devices, says Mike Moffatt in the Globe and Mail:
Last week, I wrote that the federal government’s changes to tariffs in Budget 2013 would result in new import duties on models of MP3 players and three of four models of Apple iPods. The tariff changes involve changing the tariff status of 72 countries, so music devices manufactured in China, Indonesia and Malaysia will pay a 5 to 6 per cent tariff rather than their “preferential” rate of zero, starting in 2015.
The article caused quite a stir, and the government denied it was true. A spokeswoman for Finance Minister Jim Flaherty said the article was wrong. “Music devices like iPods are imported into Canada duty-free under a long-standing special tariff classification from 1987,” she wrote. That classification, which was unaltered by the recent budget, is known by its number: 9948.00.00. (We’ll call it 9948 for short.)
However, a close reading of the relevant document, Tariff Item 9948.00.00 (9948 for short), shows that to qualify for the special classification, the importer must meet strict criteria.
My position that importers cannot meet the requirements of 9948 rests on three straight-forward premises:
1. It appears that sellers of iPods and MP3s are required to collect “end use certificates” from the final consumer on each sale, and be able to present these to the CBSA if audited.
2. The 9948 requirement for “end use certificates” appears to be actively enforced by the CBSA.
3. Retailers cannot reasonably collect these certificates from consumers when they buy an iPod.
These three, put together, make retail sales of iPods and MP3 players ineligible for 9948 and therefore subject to an iPod tariff. What follows is my evidence.
The importer must maintain a database (what Moffatt calls “an iPod registry”) of personal information on the final purchasers of the devices, but there is no matching legal requirement on the consumer to provide this personal information (which would probably violate privacy laws in any other context).
The CBSA’s Memorandum D10-14-51 requires that consumers attest that they will use the iPod in a manner in which it is “physically connected” to a computer (though not necessarily permanently so, according to the memo) and will “enhance the function” of that computer. The consumers must attest that their devices will be “solely used for the purpose for which they were imported.”
If a consumer uses a device in a manner not covered by 9948 during the first four years of ownership, the importer is required to “make a correction to the declaration of tariff classification and pay any applicable duties and taxes.”
This rule is not trivial. CITT Appeal No. AP-2008-023 discusses the need for sellers claiming the tariff reduction (here Code 2101, the predecessor to 9948.00.00) to show that the end consumer is using the goods in the manner described on the certificate.
But there is no practical way an importer could possibly verify and ensure that that the retailer’s customers have not changed how they are using iPods and MP3 players.
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March 31, 2013
The question is not whether armed drones will be deployed domestically, but when
Glenn Greenwald presents a strong case that it is inevitable that armed drones will be deployed over the US:
The use of drones by domestic US law enforcement agencies is growing rapidly, both in terms of numbers and types of usage. As a result, civil liberties and privacy groups led by the ACLU — while accepting that domestic drones are inevitable — have been devoting increasing efforts to publicizing their unique dangers and agitating for statutory limits. These efforts are being impeded by those who mock the idea that domestic drones pose unique dangers (often the same people who mock concern over their usage on foreign soil). This dismissive posture is grounded not only in soft authoritarianism (a religious-type faith in the Goodness of US political leaders and state power generally) but also ignorance over current drone capabilities, the ways drones are now being developed and marketed for domestic use, and the activities of the increasingly powerful domestic drone lobby. So it’s quite worthwhile to lay out the key under-discussed facts shaping this issue.
I’m going to focus here most on domestic surveillance drones, but I want to say a few words about weaponized drones. The belief that weaponized drones won’t be used on US soil is patently irrational. Of course they will be. It’s not just likely but inevitable. Police departments are already speaking openly about how their drones “could be equipped to carry nonlethal weapons such as Tasers or a bean-bag gun.” The drone industry has already developed and is now aggressively marketing precisely such weaponized drones for domestic law enforcement use. It likely won’t be in the form that has received the most media attention: the type of large Predator or Reaper drones that shoot Hellfire missiles which destroy homes and cars in Pakistan, Yemen, Somalia, Afghanistan and multiple other countries aimed at Muslims (although US law enforcement agencies already possess Predator drones and have used them over US soil for surveillance).
March 9, 2013
Drones and you (and you, and you, and …)
Mark Steyn on why the deployment of drones within the continental United States was inevitable:
I shall leave it to others to argue the legal and constitutional questions surrounding drones, but they are not without practical application. For the past couple of years, Janet Napolitano, the Secretary of Homeland Security, has had Predator drones patrolling the U.S. border. No, silly, not the southern border. The northern one. You gotta be able to prioritize, right? At Derby Line, Vt., the international frontier runs through the middle of the town library and its second-floor opera house. If memory serves, the stage and the best seats are in Canada, but the concession stand and the cheap seats are in America. Despite the zealots of Homeland Security’s best efforts at afflicting residents of this cross-border community with ever more obstacles to daily life, I don’t recall seeing any Predator drones hovering over Non-Fiction E-L. But, if there are, I’m sure they’re entirely capable of identifying which delinquent borrower is a Quebecer and which a Vermonter before dispatching a Hellfire missile to vaporize him in front of the Large Print Romance shelves.
I’m a long, long way from Rand Paul’s view of the world (I’m basically a 19th century imperialist a hundred years past sell-by date), but I’m far from sanguine about America’s drone fever. For all its advantages to this administration — no awkward prisoners to be housed at Gitmo, no military casualties for the evening news — the unheard, unseen, unmanned drone raining down death from the skies confirms for those on the receiving end al-Qaida’s critique of its enemies: as they see it, we have the best technology and the worst will; we choose aerial assassination and its attendant collateral damage because we are risk-averse, and so remote, antiseptic, long-distance, computer-programmed warfare is all that we can bear. Our technological strength betrays our psychological weakness.
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Good news and bad news about border searches of your electronic devices
Declan McCullagh on the mixed news from a recent court ruling:
U.S. customs officials must have a reasonable justification before snatching your laptop at the border and scanning through all your files for incriminating data, a federal appeals court ruled today.
The Ninth Circuit Court of Appeals ruled that Homeland Security’s border agents must have “reasonable suspicion” before they can legally conduct a forensics examination of laptops, mobile phones, camera memory cards, and so on.
Today’s opinion is a limited — but hardly complete — rejection of the Obama administration’s claim that any American entering the country may have his or her electronic files minutely examined for evidence of criminal activity. Homeland Security has said the electronic border searches could detect terrorists, drug smugglers, and people violating “copyright or trademark laws.”
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February 23, 2013
The DHS paperwork error that resulted in a boat being seized
There are few things more frustrating to deal with than officious bureaucrats with a rule book (and a gun). Here’s an example of how “the rules” matter more than common sense or rationality:
DHS takes documents supplied by the builder and creates a government form that includes basic information about the boat, including the price.
The primary form, prepared by the government, had an error. The price was copied from the invoice, but DHS changed the currency from Canadian to U.S. dollars.
It has language at the bottom with serious sounding statements that the information is true and correct, and a signature block.
I pointed out the error and suggested that we simply change the currency from US $ to CAD $ so that is was correct. Or instead, amend the amount so that it was correct in U.S. dollars.
I thought this was important because I was signing it and swearing that the information, and specifically the price, was correct.
The DHS agent didn’t care about the error and told me to sign the form anyway. “It’s just paperwork, it doesn’t matter,” she said. I declined.
She called another agent and said simply “He won’t sign the form.” I asked to speak to that agent to give them a more complete picture of the situation. She wouldn’t allow that.
Then she seized the boat. As in, demanded that we get off the boat, demanded the keys and took physical control of it.
What struck me the most about the situation is how excited she got about seizing the boat. Like she was just itching for something like this to happen. This was a very happy day for her.
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February 11, 2013
Senate report calls for tariff cuts
In the Financial Post, Terence Corcoran looks at the good and not-so-good aspects of a recent Senate report on the reasons Canadians pay so much more for goods than Americans (even when the goods are identical and the currencies are trading at par):
Retail prices in Canada, seemingly across the board, are higher. Even with the Canadian dollar at par, the price of everything from running shoes to televisions and Chevy Camaros to books is said to be above U.S prices. One bank report once put the Canada-U.S. price gap at 20%.
Somebody’s gotta do something, everybody agrees. Enter the Senate committee with one of the most hard-nosed, market-driven overviews of how and why Canadians pay more for goods at retail. The report dodges and fudges some key issues, especially farm product supply management, which was seen by the committee and the retail industry as too politically hot to handle.
[. . .]
Even in this, however, the committee pulls its first punch. The recommendation to “review” such tariffs — watery phrasing in itself — also suggests “keeping in mind the impact on domestic manufacturing.” Sorry, folks, but you can’t have it both ways. Tariffs are protectionist devices for manufacturers that consumers pay for. If you want to reduce the price to consumers, the $3.9-billion in protection for manufacturers has to go. End of discussion.
What makes The Canada-USA Price Gap even more valuable is its compact insights into the many causes of higher retail prices in Canada. The economy is a complicated and often unfathomable series of market and price relationships beyond the power and even understanding of policy makers. The report recognizes that fact time and again.
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February 7, 2013
Japan scrambles fighters after two Russian aircraft intrude
Japan’s military forces are getting quite a workout these days, with the standoff with China over the Senkaku Islands and now the Russians are getting aggressive about probing Japanese airspace:
Two Russian fighter jets have violated Japanese airspace, prompting Tokyo to scramble its own aircraft, reports say.
Japan lodged a protest after the planes were detected off the northern island of Hokkaido for just over a minute.
The incident happened after Japanese PM Shinzo Abe said he was seeking a solution to a territorial dispute with Russia over a Pacific island chain.
Russia’s military denied the incursion, saying the jets were making routine flights near the disputed islands.
Mr Abe was speaking on the anniversary of an 1855 treaty which Japan says supports its claims to the islands.
The four islands — which Russia calls the Southern Kurils and Japan calls the Northern Territories — are the subject of a 60-year-old dispute.
Because of the dispute, the two nations have not yet signed a peace treaty to end World War II.
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January 28, 2013
India’s Chinese border to be reinforced
Strategy Page on the Indian government’s planned upgrades along the shared border with China:
The Indian Army wants $3.5 billion in order to create three more brigades (two infantry and one armored) to defend the Chinese border. Actually, this new force is in addition to the new mountain corps (of 80,000 troops) nearing approval (at a cost of $11.5 billion). The mountain corps is to be complete in four years. The three proposed brigades would be ready in 4-5 years. By the end of the decade India will have spent nearly five billion dollars on new roads, rail lines and air fields near the 4,057 kilometer long Chinese border.
The Indian Army currently has 37 Divisions including; 4 RAPID (Reorganised Army Plains Infantry Divisions) Action Divisions, 18 Infantry Divisions, 10 Mountain Divisions, 3 Armored Divisions and 2 Artillery Divisions. There are also 12 independent combat brigades (five armor and seven mechanized infantry). Most of the army has been organized and trained to fight the Pakistani army in flat terrain. The Chinese border is largely mountainous.
Three years ago India quietly built and put into service an airfield for transports in the north (Uttarakhand) near their border with China. While the airfield can also be used to bring in urgently needed supplies for local civilians during those months when snow blocks the few roads, it is mainly there for military purposes in case China invades again. Uttarakhand is near Kashmir, and a 38,000 square kilometer chunk of land that China seized after a brief war with India in 1962. This airfield and several similar projects along the Chinese border are all about growing fears of continued Chinese claims on Indian territory. India is alarmed at increasing strident Chinese insistence that is owns northeastern Indian state of Arunachal Pradesh. This has led to an increased movement of Indian military forces to that remote area.
India quickly discovered that a buildup in these remote areas is easier said than done. Moreover, the Indians found that they were far behind Chinese efforts. When they took a closer look three years ago, Indian staff officers discovered that China had improved its road network along most of their 4,000 kilometer common border. Indian military planners calculated that, as a result of this network, Chinese military units could move 400 kilometers a day on hard surfaced roads, while Indian units could only move half as fast, while suffering more vehicle damage because of the many unpaved roads.
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December 24, 2012
What is the French for “voting with your feet”?
Put your tax rates up too high and people start to look at alternative living and working arrangements:
Actor Gérard Depardieu’s decision to flee France for Belgium to avoid a 75 percent marginal tax rate on incomes above $1.3 million sends a message we here in America should heed: Those who are singled out for tax increases are not stationary targets. The means of avoiding and evading the taxman are legion.
U.S. government agencies routinely issue estimates of how changes in the tax code will affect the flow of revenues to the treasury. President Obama says the tax changes he has been seeking will bring in $1.6 trillion over a decade. But such estimates assume taxpayers are something other than human beings who engage in purposive action. People like to keep the money they make — why shouldn’t they? — and they typically avail themselves of every legal (and not-so-legal) strategy to do so. Change the tax environment by raising rates or adversely modifying the rules, and taxpayers, especially those in the upper echelons of earners, can be counted on to modify their conduct accordingly; there’s no reason to think their wish to hold on to their money has diminished just because the tax code has changed.
Economists as far back at J. B. Say and Gustave de Molinari in the 19th century understood this. As Molinari wrote in his 1899 book, The Society of To-morrow, “The laws of fiscal equilibrium set a strict limit to the degree within which it is possible to impose new taxes, or to increase the rates of those already in force. The relative productivity of taxes soon shows when this point has been overstepped, for then returns not only cease to rise, but immediately begin to fall.”
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