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Archive for December 7th, 2009

I’m not sure whether this is a good thing or bad thing, but it surely says something that international drug dealers and money launderers prefer the euro over the dollar. The good news, so to speak, is that this is not a referendum on Bernanke’s easy-money policy. Instead, it seems the drug lords prefer larger denominations, and the U.S. no longer circulates bills larger than $100. The Guardian reports:

International drug cartels have abandoned the US dollar for high denomination euros to launder millions in illegal profits, Europol has revealed. The gangs no longer use $100 bills because €500 notes – the largest denomination of euro – take up less room when transporting large amounts of cash across the world. …Rob Wainwright, director of Europol, said last week police forces across continental Europe were tracking the movements of smuggled and laundered euros and had traced much of it back to large drug gangs. …The scale of the smuggling operation was revealed in figures from the Colombian National Directorate. Only $300,000 worth of euros were declared as entering Colombia between January and June 2007, but over $551m in euros left the country. Once in Europe, the notes can be exchanged for dollars.

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That’s the question posed by the Wall Street Journal’s editorial page, which discusses how companies often get seduced into supporting big government – or, in some cases, are active proponents of bigger government since they’ve learned how to milk the system. In the long run, of course, statism saps an economy’s vitality, which is bad for workers, investors, and consumers:

One lesson that Democrats learned from the failure of HillaryCare in 1994 is that they had to buy the silence, if not the outright support, of the business class. They’ve done this brilliantly by peddling the illusion that ObamaCare will “lower costs” for employers. But slowly as the legislative details become clear, it is dawning on executives of businesses large and small that reform is boiling down to a huge tax increase to finance a gigantic new entitlement. …With only a few exceptions, drug makers and health-care providers have shown that their priority is rent-seeking from government, which means that any last-minute push back will have to come from the other six-sevenths of the economy. The Chamber of Commerce and National Federation of Independent Business have finally figured out they were being taken for a ride. And now even the Business Roundtable, the association of CEOs from the largest companies, is engaged in a furious internal debate about the way forward. The Roundtable has been vaguely supportive but restive. But last week Roundtable president John Castellani was informed in a contentious conference call that many of his members will quit if the organization isn’t more assertive against ObamaCare. …The larger issue for business is the productivity and competitiveness of the U.S. economy. Democrats are about to pass the largest entitlement expansion in more than four decades when federal spending is already at unprecedented levels. The “pay or play” tax on employers and the hike in payroll taxes on top earners in the House and Senate bills are merely teaser rates. The long-term pressures created on the federal fisc would require enormous tax hikes that would depress capital investment and economic growth, to say nothing of the Roundtable’s priority of reducing U.S. corporate tax rates that are among the world’s highest. The tendency among business groups is usually to conciliate and speak the language of consensus—especially with Democrats running all of Washington and able to do great harm to anyone who doesn’t cooperate. And no doubt the Roundtable is hearing from the CEOs of companies like Pfizer, Wal-Mart and General Electric that are deeply invested in more government control of the economy.

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My earlier post noted that I would be speaking on a panel with Dan Hannan, one of the English members of the European Parliament who is famous in the blogosphere for his verbal dismantling of Gordon Brown. But since I’m in Brussels to discuss European reform in a city that is devoted to statism, this speech by Dan Hannan is much more relevant.

I wish Republicans were capable of doing this.

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