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Archive for the ‘Prostitution’ Category

I’ve pointed out that Washington is a cesspool of legal corruption. But if you don’t believe me (and you have a strong stomach), feel free to peruse these posts, all of which highlight odious examples of government sleaze.

But occasionally elected officials cross the blurry line and get in trouble for illegal corruption.

For those of you who follow politics, you may have seen news reports suggesting that Robert Menendez, a Democratic Senator from New Jersey, will soon be indicted for the alleged quid pro quo of trying to line the pockets of a major donor.

Attorney General Eric Holder has signed off on prosecutors’ plans to charge Menendez, CNN reported on Friday. …A federal grand jury has been investigating whether Menendez improperly used his official office to advocate on Melgen’s behalf about the disputed Medicare regulations when he met with the agency’s acting administrator and with the secretary of Health and Human Services, according to a ruling by a federal appeals court that became public last week. The ruling also said the government was looking at efforts by Menendez’s office to assist a company Melgen partly owned that had a port security contract in the Dominican Republic.

I certainly have no interest in defending Senator Menendez, but I can’t help but wonder what’s the difference between his alleged misbehavior and the actions of almost every other politician in Washington.

Here’s what I assume to be the relevant part of the criminal code, which I downloaded from the Office of Government Ethics (yes, that’s a bit of an oxymoron).

Stripped of all the legalese, it basically says that if a politician does something that provides value to another person, and that person as a result also gives something of value to the politician, that quid-pro-quo swap is a criminal offense.

Now keep this language from the criminal code in mind as we look at some very disappointing behavior by Republican presidential candidates at a recent Iowa gathering.

As Wall Street Journal opined, GOPers at the Ag Summit basically competed to promise unearned benefits to the corporate-welfare crowd in exchange for political support (i.e., something of great value to politicians).

Iowa is…a bad place to start is because it’s the heartland of Republican corporate welfare. Witness this weekend’s pander fest known as the Ag Summit, in which the potential 2016 candidates competed to proclaim their devotion to the Renewable Fuel Standard and the 2.3-cent per kilowatt hour wind-production tax credit. The event was hosted by ethanol kingpin Bruce Rastetter… Two of the biggest enthusiasts were Rick Santorum and Mike Huckabee… The fuel standard “creates jobs in small town and rural America, which is where people are hurting,” said Mr. Santorum, who must have missed the boom in farm incomes of recent years.

But it’s not just social conservatives who were promising to swap subsidies for political support.

Self-styled conservative reformers may be willing to take on government unions, which is laudable, but they get timid when dealing with moochers in Iowa.

Scott Walker, who in 2006 said he opposed the renewable fuel standard, did a switcheroo and now sounds like St. Augustine. He’s for ethanol chastity, but not yet. The Wisconsin Governor said his long-term goal is to reach a point when “eventually you didn’t need to have a standard,” but for now mandating ethanol is necessary to ensure “market access.”

And establishment candidates also tiptoed around the issue, suggesting at the very least a continuation of the quid pro quo of subsidies in exchange for political support.

Jeb Bush at least called for phasing out the wind credit, which was supposed to be temporary when it became law in 1992. But he danced around the renewable standard, which became law when his brother signed the energy bill passed by the Nancy Pelosi-Harry Reid Congress.

Geesh, maybe this is why Bush won’t promise to oppose tax hikes.

And there are more weak-kneed GOPers willing to trade our money to boost their careers.

Chris Christie wouldn’t repudiate the wind tax credit, perhaps because in 2010 the New Jersey Governor signed into law $100 million in state tax credits for offshore wind production. He also endorsed the RFS as the law of the land…, but what voters want to know is what Mr. Christie thinks the law should be. Former Texas Governor Rick Perry sounded somewhat contrite for supporting the wind tax credit, which has been a boon for Texas energy companies.

The only Republican who rejected corporate welfare (among those who participated) was Senator Ted Cruz.

The only Ag Summiteer who flat-out opposed the RFS was Texas Senator Ted Cruz , who has also sponsored a bill in Congress to repeal it. In response to Mr. Rastetter’s claim that oil companies were shutting ethanol out of the market, he noted “there are remedies in the antitrust laws to deal with that if you’re having market access blocked.”

Though even Cruz deviated from free-market principles by suggesting that anti-trust bureaucrats should use the coercive power of government to force oil companies to help peddle competing products.

Sigh.

By the way, I don’t mean to single out Republicans. Trading votes for campaign cash is a bipartisan problem in Washington.

But it is rather disappointing that the politicians who claim to support free markets and small government are so quick to reverse field when trolling for votes and money.

At least politicians like Obama don’t pretend to be a friend before stealing my money.

P.S. Normally I try to add an amusing postscript after writing about a depressing topic.

I’m not sure whether this story from the U.K.-based Times is funny, but it definitely has an ironic component.

Judge Juan Augustín Maragall, sitting in Barcelona, ruled that prostitutes should be given a contract by their employers, who should also pay their social security contributions. …In giving his verdict in the civil case, brought over a breach of labour regulations, the judge went further than expected, ruling that the women’s rights had been flouted by the management and forcing the company to pay the social security payments of three prostitutes backdated to 2012. Because of the ruling all brothels will be forced with immediate effect to issue contracts to staff and pay their social security contributions.

Now here’s the ironic part.

The ruling will generate tax revenue even though it’s actually illegal to employ prostitutes!

…it is against the law to make money from pimping, which carries a four-year jail term.

I guess the Judge could have ruled that the customers were the employers, but somehow I suspect it would have been difficult to extract employment taxes from those men.

Just like it would be difficult to extract employment taxes from the women.

Though the hookers won’t mind getting unemployment benefits so long as someone else is paying the taxes.

Conxha Borrell, of the Association of Sex Professionals, welcomed the ruling.

I guess we should add this to our great-moments-in-human-rights series.

Though maybe I should start a great-moments-in-economic-ignorance series since the prostitutes will be the ones who bear the burden of the tax even if the pimps are the ones writing the checks to the government (just as workers bear the burden of the “employer share” of the Social Security payroll tax).

P.P.S. Maybe Spanish hookers should reclassify themselves as porn artists who allow audience participation? That way, they can take advantage of Spain’s preferential tax rate for smut.

P.P.P.S. The Germans at least have figured out an efficient way to tax prostitutes.

P.P.P.P.S. Though maybe prostitutes should become politicians. The business model is quite similar, and I suspect you can “earn” more income selling access to other people’s money rather than selling sex to men who have to use their own money.

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I have a love-hate relationship with tax loopholes.

I’m a big fan of the flat tax, in part because I hate when powerful interest groups use their insider connections to get special treatment. This corrupt process helps explain why the tax code is now a 74,000-page monstrosity.

I want to get rid of all preferences, deductions, credits, deductions, exclusions, and shelters, including one that benefit me such as the home mortgage interest deduction, the charitable contributions deduction, and the state and local tax deduction.

On the other hand, I favor just about anything that lets people keep more of their money. Loopholes are escape hatches that people can use to protect themselves from the grasping claws of the IRS.

The bottom line is that we should only get rid of loopholes if every penny of potential new revenue is used to finance lower tax rates.*

Now that we’ve covered some basics, let’s stop being serious and boring and look at what has to be the strangest tax loophole in the United States.

And it wasn’t even concocted by the crowd in Washington. The award for strangest tax loophole goes to the politicians of Nevada, who decided at some point not to apply the sales tax to prostitution.

Here are some of the details from the New York Daily News.

Nevada Hooker TaxThe tax man may soon be visiting a few Nevada brothels. …Assembly Speaker Marilyn Kirkpatrick (D-North Las Vegas) says the bill would target events and businesses that have either been deemed exempt from state sales taxes or have simply been overlooked. Those operations include brothels, which Nevada lawmakers have been hesitant to tax out of fear that doing so would further legitimize the stigmatized, but legal trade. …George Flint, the director of the Nevada Brothel Association, fears that so-called houses of ill repute could not handle an 8% tax on money spent at brothels, and has proposed a $5 entrance fee instead.

As a libertarian, I suppose I should be impressed. Not only is this “victimless crime” legal, but it isn’t taxed!

But as an observer of politics, I’m completely perplexed. Normally, politicians love to impose “sin taxes” on behaviors that are seen as unseemly. It’s sort of a win-win situation for them. They get to collect more revenue while telling us that it’s for our own good.

This helps explain why there are high taxes on things such as booze, cigarettes, energy, and fast food.

So why have Nevada politicians overlooked (at least up to now) the chance to tax prostitution?

I suppose I could make a joke that they didn’t want to tax the things that they consume, but I’m being serious.

Are the lobbyists for brothels super effective? Well, they probably do have the best holiday parties, but is that why prostitution isn’t taxed?

Beats me. Sounds like a good opportunity for public policy research.

*Another concern is that many politicians don’t understand the difference between a tax loophole such as ethanol and a tax penalty such as double taxation, so their version of tax reform could make bad policies even worse.

P.S. Since this post is about taxes and prostitution, I can’t resist sharing this bit of humor.

P.P.S. Speaking of prostitution, did you know that British taxpayers finance sex trips to Amsterdam?

P.P.P.S. You won’t be surprised to learn that climate-change ideologues claim that global warming causes prostitution.

P.P.P.P.S. You also won’t be surprised to learn that the Germans have figured out very creative ways of taxing prostitution.

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I thought conservatives were the ones with an unseemly fixation on sex. They’re supposed to be the Puritans who, in the words of Mencken, have a “haunting fear that someone, somewhere, may be happy.”

Maybe that’s true in a few cases, but it also appears that some leftists also are bizarrely focused on sex. Only instead of worrying that someone may be having fun, they concoct novel claims that a statist agenda is necessary to stop prostitution.

Just the other day, for instance, some lawmakers actually asserted that “climate change” would force more women to become prostitutes.

Several House Democrats are calling on Congress to recognize that climate change is hurting women more than men, and could even drive poor women to “transactional sex” for survival. …Rep. Barbara Lee (D-Calif.) and a dozen other Democrats, says the results of climate change include drought and reduced agricultural output. It says these changes can be particularly harmful for women. “[F]ood insecure women with limited socioeconomic resources may be vulnerable to situations such as sex work, transactional sex.

Though these American politicians are behind the times. A Filipino bureaucrat at the United Nations proposed this laughable theory as early as 2009.

While the link between climate change and “transactional sex” is a bit of a stretch, to put it mildly, it’s not the only area where leftists make bizarre and unsubstantiated assertions about stopping prostitution with a statist agenda.

I thought I had dealt with every imaginable silly argument against tax havens, but I didn’t give my leftist friends enough credit. It seems that low-tax jurisdictions somehow facilitate sex slavery.

While battles over government budget deficits dominate the media coverage, tax havens pose a much bigger problem. They facilitate bribery, they enable sex slavery, and they foster terrorism. As Sachs notes, “the havens serve countless purposes, yet not one is for the social good.”

Not surprisingly, there’s not a single piece of evidence to support any of the assertions in this excerpt. We’re just supposed to believe that financial privacy laws enable bad things because of money laundering.

Yet actual real-world evidence – as opposed to ideologically motivated assertions – shows that tax havens are not money-laundering centers. Indeed, they generally have stronger laws against dirty money than “onshore” jurisdictions.

P.S. So why do leftists have this quirky fixation about prostitutes and public policy? Do they go to left-wing conferences and hear stories from Dominique Strauss-Kahn , the infamous former head of the IMF. Or do they get briefings from my one-time debating opponent Elliot Spitzer, who also was disgraced because of “transactional sex”?

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I don’t know if this is true, but it’s been circulating for so long that there’s probably some fire under all the smoke. Does anybody know if this is for real, or an urban legend?

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I think Viagra subsidies for sex offenders are an absurd example of government stupidity in America. I’m also amazed that European taxpayers are forced to pay for penile implants for bureaucrats at the European Commission. But I’m almost speechless to learn that British taxpayers are financing hanky-panky with prostitutes in Amsterdam for some disabled citizens. According to the Daily Mail, taxpayers across the pond also are paying for lap dances, though it’s unclear why some beneficiaries get deluxe “full service” trips to foreign countries while others must make do with trips to local strip clubs. I have great sympathy for people who are disabled, and I certainly have no problem with them purchasing sexual services, but I agree with the guy from the Disability Alliance that this is not an appropriate role for government.

A ‘man of 21 with learning disabilities has been granted taxpayers’ money to fly to Amsterdam and have sex with a prostitute. His social worker says sex is a ‘human right’ for the unnamed individual – described as a frustrated virgin. His trip to a brothel in the Dutch capital’s red light district next month is being funded through a £520million scheme introduced by the last government to empower those with disabilities. They are given a personal budget and can choose what services this is spent on. The man’s social worker, who spoke on the condition of anonymity, said his client was an ‘angry, frustrated and anxious young man’ who had a need for sex. …The trip emerged in data from Freedom of Information requests which revealed that many councils are using the money from the government’s Putting People First scheme to pay for prostitutes, visits to lap dancing clubs and exotic holidays. …Critics yesterday said the use of taxpayers’ money to fund sex trips abroad as ‘deeply worrying’. In Greater Manchester and Norfolk, social care clients have used their payments for internet dating subscriptions. …Neil Coyle, director of policy at Disability Alliance, said most people with disabilities did not want or expect the state to pay for sexual services. ‘Public bodies don’t exist to find people sexual partners,’ he said.

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The enviro-nuts must be getting really desperate. A bureaucrats from the Philippines actually is claiming that global warming is causing more prostitution, which is increasing the spread of HIV. I can easily believe that more prostitution is a reciple for more sexually-transmitted diseases, but the assertion that climate change is causing more prostitution is laughably absurd:

Effects of climate change have driven women in communities in coastal areas in poor countries like the Philippines to risk dangerous jobs, and sometimes even into the flesh trade. Suneeta Mukherjee, country representative of the United Nations Food Population Fund (UNFPA), said women in the Philippines are the most vulnerable to the effects of climate change in the country. “Climate change could reduce income from farming and fishing possibly driving some women into sex work and thereby increase HIV infection,” Mukherjee said during the Wednesday launch of the UNFPA annual State of World Population Report in Pasay City.

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