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Ragging on Ritchie

Wondrous Ritchie: the Co Op failed because it was too neoliberal!

Myners has pointed out two things. First, management was out of control. I think there is little doubt that the management team of the Co-op had fully embraced the neoliberal logic that competing is the sole goal of all organisations. They evidenced this through a desire to compete on the basis of the group’s size and breadth even though that both clearly compromised viability and, at least as importantly, defied the supposed ethos of the group, which was and should be to supply value to its members. Yt has very clearly failed to do that. This was the fundamental malaise at the heart of this issue. The management, possibly motivated by self interest (which appears to have been well rewarded), had very clearly forgotten all that this group was supposed to be about and what they were good at.

As worryingly, the board that were supposed to remind them of this appear not to have done so. They take some significant blame for what happened if that is true: it looks like they succumbed to the same neoliberal logic, not that this is surprising: the whole neoliberal game of the last thirty years has been to make its logic of competition in all things all pervasive. It would appear to have succeeded here, at great cost.

Sirsly?

Ritchie really doesn’t get markets, does he?

Tax is, of course, one of the things that needs to be accounted for locally. It can only be paid in that way. But tax is paid on profits, which is always a residual of economic activity. As a result, people want an indication of the scale of the activities of any company with whom they engage in the place that they are.

That means the local reporting of sales, on both a source and destination basis, for the group that is preparing the report; details of the number of people employed in a country, and their total pay; information on key sensitive data that is likely to influence profit shifting, such as interest paid on intragroup loans, royalties and management charges;and local profits declared and information on taxes due and paid on both a current and deferred basis, for each and every jurisdiction in which a multinational company trades. All this information is vital if people are to have a chance to understand the activities of the companies that they engage with.

The great joy of the market system is that we don’t actually have to worry about these things if we don’t want to. We can just look at the price of bananananas in Tesco and make a decision, Y/N. We don’t need to know the producer, the owner, the tax situation, anything else: all the information we need is boiled down into that price system.

And I’m sure that some of these varied nonsenses being foisted upon us, from country by country reporting through the various know your supply chain initiatives to Fair Trade and the rest are coming from people who just don’t like that market and price system. They hanker for the days when people like them could indeed tell people what to buy where and how according to their interpretation of what other people should be doing.

As an example I’ve had a long conversation with the people at Global Witness. This conflicts minerals stuff is one thing but they really do see that as just a wedge in the crack. They want everyone to be able to track their entire supply chain all the way through the entire global economy. To the subcontractors’ subcontractors’ subcontractor and beyond. They simply don’t grasp why we actually have this “free market” system at all. Which is that that level of knowledge simply isn’t available in an economy that at any one time has billions of different things available for sale. They’re hankering after the planned economy again, failing to realise that the Socialist Calculation Problem really just doesn’t have a solution.

Ritchie’s only a small part of it but I am indeed convinced that this is a part of what is going on.

Ritchie: Gimmie your tax money!

The HMRC response was interesting. As a matter of fact we know that there is an unlevel playing field in terms of HMRC access. Funding is a clear part of this issue, and it is beholden on HMRC and the government to fund alternative opinion if it wants good tax policy (and before anyone bleats of my promoting self-interest, the issue is as much about smaller firms and individuals having access as NGOs: all suffer the same problem).

Umm, why shouldn’t the funding come from those who want to do the beholdening?

Ritchie’s new economics

And there, in a nutshell, John Kay has summarised why we are still in an economic mess. The syllogism that underpins neoclassical economics (and in turn much of neoliberal and neoliberal economics) is firstly that people are always and only self interested (the major premise) and secondly are rational (the minor premise( form which it follows that they maximise their well-being. This is the foundation of the logic of most prevailing economic thought and almost all econometrics.

There are, however, three faults with this a priori thinking. People are a long way from being solely self interested. Secondly they are not rational. And thirdly, as a result, they probably never maximise, although they do undoubtedly compete (which is a very long way from being the same thing, as first noted (I think) be Thorstein Veblen.

This has profound consequences. When models are built on the basis of behaviour that does not exist, giving rise to policy recommendations that conflict with the reality of the human condition then stress happens.

And that’s exactly what is going on now.

If you want a better syllogism this is it: firstly, people want to live harmoniously in community whilst, secondly, wanting to achieve for themselves and those they care for and so thirdly they seek to fulfil as much of their potential as is possible within the constraints imposed upon them.

No one at all is stupid enough to think that humans are solely self-interested. It is, even in Smith’s version, enlightened self-interest that counts. We cannot explain, for example, the adoption of unrelated children without assuming some motivation beyond pure self-interest. The second assumption, that humans are rational: well, do we think that it would be better if we based our worldview on the idea that humans are all mad and irrational? But the rationality assumption isn’t even that human beings are entirely rational. For a start there’s vast areas of neoclassical economics exploring where we know that people are not so: hyperbolic discounting anyone? We also don’t assume that people maximise: we do think that people have a pretty good go at getting the best deal they can but we also know very well that most people, most of the time, satisfact. That’s why most of us are shagging the people we are rather than holding out for Scarlett Johannson or George Clooney (to taste).

But even if we leave all of that aside and take Ritchie’s arguments at their face value.

“wanting to achieve for themselves and those they care for and so thirdly they seek to fulfil as much of their potential as is possible within the constraints imposed upon them.”

How the hell is that different from the idea that people maximise rationally?

Ritchie on pensions

Second, people want certainty and pensions do not give it. I have long argued that infrastructure and employment generating bonds provide such certainty. I still think if people could invest in their local communities they would, and likewise if they could invest in the NHS – which they know they will need in their old age – they definitely would. The rates of return paid could be a lot lower than PFI and still provide a fortune in savings for public sector infrastructure costs and a fair return to pensioners.

Third people want to invest in housing and we need a lot of it: social housing funds could be the basis for pension arrangements for a long time to come and provide enormous social worth to the UK.

Rightie ho.

Will this happen? I doubt it, very much.

Should it happen? Yes, I think it should and I very strongly suspect many of us would be very much better off as a result, including all those about to be enrolled in new state sponsored pension arrangements that will all be ‘invested’ in conventional stock market based portfolios and no doubt will be lost for future generations of pensioners in this country as a result. Such arrangements belong to the past and simply fatten the City at cost to the rest of the economy.

A slight problem here.

Who or what is this “City” referred to here? Why, The City is the name we give to the assembled financial experts who allocate savings around the economy. So Ritchie’s arguing that we must take that function away from the people who currently do it, and make sure that the money is invested into infrastructure projects and social housing. And the people who do that allocation will undoubtedly be entirely different people from the people who currently do the capital allocation of putting pensions savings into houses, stocks, bonds and projects.

Entirely different people doing an entirely different thing. No doubt about it.

This is at least better than his suggestion that 25% of pension funds must be invested in new businesses: that would mean turning it all over to the venture capitalists.

And, seriously, who in buggery would suggest investing in bonds over a 30 year time scale? Hasn’t the bloke ever heard of inflation?

Glorious, glorious, Ritchie

Andrew

You’re getting pretty tedious on this point, to be polite

The position is clearly not clear

If it was no guidance would have been needed on any tax and nor would HMRC say it will need to revisit the issue

Quite simply, you are wrong

Richard

To provide the background here.

So, HMRC update their advice on how Bitcoin is to be taxed. Ritchie complains because it doesn’t make clear how seigniorage profits will be taxed. We all tell him that this is obvious and no guidance is needed on this point.

Ritchie’s response is as above. That obviously it wasn’t obvious other wise why would HMRC issue guidance?

But HMRC didn’t issue guidance on how seigniorage will be taxed therefore it must, by Ritchie’s latest argument, be obvious, no?

Yes, Ritchie gets the taxation of Bitcoin wrong

Sigh.

There is one good reason for Japan wanting to do this: it has come to the apparent conclusion that Bitcoin is a commodity used for speculative purposes and not primarily as a currency just as the UK has come to the reverse (incorrect, I think) conclusion.

Japan also wants to impose a tax after the collapse of two Bitcoin exchanges within days of each other leading to the loss of significant numbers of the supposedly always traceable currency, giving a lie to its supposed transparent quality for crime-beating purposes and to its merit as a regulation free zone. Tax, it is thought by Japan, would help impose that regulation.

It looks like HMRC made the wrong decision at the wrong time. There’s always time to reverse it.

Double sigh.

Here’s someone explaining what the UK and Japanese approaches to the taxation of Bitcoin are.

The use of Bitcoins in a transaction is treated just as any other method of payment for goods and services. If VAT or sales tax on the goods and services is due then it will be due whether people pay in Yen, Pounds or Bitcoin.

The purchase of Bitcoins themselves will not be subject to VAT or sales tax as purchases of Yen, Pounds or other variations of currency are not.

The mining or earning of Bitcoins is subject to exactly the same taxation as any other method of trying to accumulate pelf. Income minus costs equals profits that are then taxed at the appropriate rate for the vehicle which is used to do said earning. A sole trader is taxed as a sole trader, a corporation as a corporation.

The only interesting thing at all will be whether mining rigs, which tend to deteriorate in value from large to spit in about 3 months will be able to have some form of accelerated depreciation. Perhaps be written off in the first year.

And that’s it. And do note, the Japanese and UK taxation systems are exactly the fucking same on all of these points.

And how else did anyone think that Bitcoin was going to be taxed?

The wondrous Murphmeister on the taxation of Bitcoin

HMRC releases guidance on the taxation of Bitcoin. Our Man in Downham Market says that there is a very large problem with this:

The unique characteristic of this currency is, therefore, that a user can create it. This is the supposed adapter at it called ‘mining’. This is and activity giving rise to profit that is equivalent to the age-old right of governments called seignorage: that is, the surplus that arises when a unit of currency is created.

There is no hint in the release as to how that surplus is to be taxed. As a result it is clear that HMRC have missed the biggest potential challenge from Bitcoins, which is that they claim a right of government, attributable to a state, which is to make a surplus from the creation of the medium of exchange. In the process they duck the fundamental destabilising nature of this activity which is intended to create a currency that is beyond the reach of taxation. As an exercise in opening the barn door and letting the horses bolt, this is a particularly good example.

He is specifically worried about the taxation of the seigniorage, the profit differential between the cost of solving the hash that creates the next part of the blockchain and the number and value of Bitcoins received for having done so.

So, what does HMRC actually say?

Corporation Tax, Income Tax and Capital Gains Tax treatment of Bitcoin and similar cryptocurrencies

As with any other activity, whether the treatment of income received from, and charges made in connection with, activities involving Bitcoin and other similar cryptocurrencies will be subject to Corporation Tax, Income Tax or Capital Gains Tax depends on the activities and the parties involved.

Whether any profit or gain is chargeable or any loss is allowable will be looked at on a case-by-case basis taking into account the specific facts. Each case will be considered on the basis of its own individual facts and circumstances. The relevant legislation and case law will be applied to determine the correct tax treatment. Therefore, depending on the facts, a transaction may be so highly speculative that it is not taxable or any losses relievable.. For example gambling or betting wins are not taxable and gambling losses cannot be offset against other taxable profits.

For businesses which accept payment for goods or services in Bitcoin there is no change to when revenue is recognised or how taxable profits are calculated.

Corporation Tax: The profits or losses on exchange movements between currencies are taxable. For the tax treatment of virtual currencies, the general rules on foreign exchange and loan relationships apply. We have not at this stage identified any need to consider bespoke rules.
For companies, exchange movements are determined between the company’s functional currency (usually the currency in which the accounts are prepared) and the other currency in question. If there is an exchange rate between Bitcoin and the functional currency then this analysis applies. Therefore no special tax rules for Bitcoin transactions are required. The profits and losses of a company entering into transactions involving Bitcoin would be reflected in accounts and taxable under normal Corporation Tax rules.
Income Tax: The profits and losses of a non-incorporated business on Bitcoin transactions must be reflected in their accounts and will be taxable on normal income tax rules.
Chargeable gains – Corporation Tax and Capital Gains Tax: If a profit or loss on a currency contract is not within trading profits or otherwise within the loan relationship rules, it would normally be taxable as a chargeable gain or allowable as a loss for Corporation Tax or Capital Gains Tax purposes. Gains and losses incurred on Bitcoin or other cryptocurrencies are chargeable or allowable for Capital Gains Tax if they accrue to an individual or, for Corporation Tax on chargeable gains if they accrue to a company.

It appears that they’re saying that such seigniorage profits will be taxed just like any other such seigniorage profits in the economy. Just as with the creation of Luncheon Vouchers, Brixton Pounds or any other form of money creation that involves seigniorage.

And do recall one of the Murphmonster’s basic insistences about the banking system. That it creates money for free for the banks in that system. Note also that he doesn’t complain that that seigniorage is not taxed. For he thinks that it is, in the normal run of things. For those profits are offset against the costs of running the banks and then the recorded and resultant profits are taxed.

He knows already that seigniorage is subject to the usual tax rules. So why is he complaining about Bitcoin being subject to exactly the same rules as the other seigniorage going on?

Ritchie on redistribution

As ever our laddie has managed to get the wrong end of the stick:

In fact, this understates, if anything the conclusion they reached. They say that even large scale redistribution does not appear to harm growth.

The article, I know, comes with a few caveats attached but the message is clear: the argument that redistributive tax policies (such as a 50p tax rate in the UK) harm growth has been holed well and truly below the water line.

In unequal societies it is now clear that if we want innovation, opportunity, jobs and growth then tackling inequality through progressive taxation is a very clear way to achieve that goal.

Umm, no.

Second, we found little to suggest that a modestly redistributive tax system has an adverse effect on growth. True, there are some signs that highly redistributive tax systems – the top 25 per cent of our sample – may crimp economic performance. But the levels of redistribution seen on average in the broad cross-section of countries we looked at seem to have had negligible direct effects on growth.

What the IMF has actually found is that modest redistribution seems not to harm growth while “excessive” does.

Ritchie then leaps from this to insist that his demands for “excessive” redistribution thus are justified. Which ain’t at all what is being said.

There’s another very interesting bit to add to this as well. Which is that other work tells us that how you do the redistribution does indeed matter. Transactions taxes are worst (they have the highest deadweight costs), then capital and corporation taxes, then income taxes, then consumption and finally repeated taxes upon real property. And it’s notable that the countries that do the most redistribution (the Nordics, they have the biggest gaps between market and post tax post benefit gini) do it by having heavier than we do consumption taxes and lighter than we do capital and corporate ones (note that that last is influenced not so much by the rate but by the base).

That is, that raising the money to do more redistribution without killing off growth is best done by exactly the tax policies that Ritchie abhors.

Which is rather fun really.

Excellent advice here

To extend Mr. deBoer’s analysis, most of the people involved in the analysis, practice, and regulation of finance “are people who think that facts matter, and so when you are loose with the facts, you make it harder to get their support.” Yeah, like impossible. Most of us—even those who might otherwise be sympathetic to your analysis or agenda—just throw up our hands and ignore you. If you can’t argue from the facts, you are simply pandering to your own anger and the prejudices of the uninformed elements in your audience. You may be penning compelling polemics, but you are wasting every serious person’s time, and you certainly aren’t convincing them. In addition, you make it easier for them to discard everything you write or say, because your argument is riddled with silly, obvious omissions, misrepresentations, and untruths. Your potential allies think you’re a harmful idiot, and your enemies gleefully disregard any valid points you might make because you are a careless, misleading boob.

So who should we offer it to?

On Ritchie’s Twitterstorm

This is really quite wonderful.

ritchiesdelusions

ritchiesdelusions1

It’s a series of delusions. The end result of which Our Ritchie is a lone crusader holding out the torch of truth against the lies and dissimulations of the eeeevil neoliberals who now rule our world.

And there’s something of a problem with this. It’s not actually neoliberals who pointed out that companies don’t pay tax. The incidence is upon people, must be. And this is a result that comes from neoclassical economics: it was first pointed out and proven well over a century ago.

And we’ve all repeatedly pointed this out to Murphy. But he carries on insisting that it’s a plot, a plot against his Curajus State, to refer to this well known truth about the universe that we inhabit.

Companies do not bear the burden of corporation tax. Some combination of the shareholders and the workers in the economy where it is imposed do. Without understanding that basic point no one will ever be able to build a reasonable tax system.

Murphy’s problem is not just that he’s wrong, it’s that he’s deluded.

Isn’t Ritchie just wonderful?

Third, the fact that the incidence of the tax may well be on bankers and their bonuses is ignored; a disingenuous claim (admittedly stated with less stridence that usual) is made that unspecified final consumers may suffer is offered instead. This is not a technical argument. Technical arguments would consider possibilities and state them all: this is deliberate one-sided suggestion that the mainstream reader may suffer alone and is therefore mistaken in their simplistic belief in the tax which the assured technocrat author is telling them, in thinly veiled code, might hit their pension. Actually, I strongly believe the reverse is the truth. An FTT will hit the churning which currently denudes many pensions of any increase in value. The fact that this argument is not considered makes clear there is nothing technical about this article.

This is in reaction to this argument:

Finally, as the commission notes, the FTT is likely to be passed on to final consumers. This makes an evaluation of the tax more difficult; whether or not it can be labelled a “Robin Hood Tax” presumably depends on whether it falls on the rich. We are not entirely sure who will really bear the tax, but “final consumers” here certainly include anyone with savings tied up in their pension. If the aim is to introduce a new tax on the rich, then why not simply do that? The best way to tax the rich is to tax the rich – for example, through a wealth tax – not to try to introduce a tax on trading in complex financial instruments, especially when it is uncertain who would actually pay.

Not a technical argument eh?

So the EU Commission itself thinks that the result of the technical analysis is that pensions and consumers will bear the burden of an FTT. Sir James Mirrlees, a Nobel Laureate for his studies of taxation systems, thinks that such a transactions tax will cascade through the economy and the burden fall on consumers. The IFS did a study of who carries the burden of the FTT we already have, Stamp Duty on shares, and concluded that it was both workers and pensioners who carried the burden.

As in, large numbers of very bright people have looked at the technical aspects of this proposed tax. And their conclusion is different from that of Richard Murphy. For technical reasons. But because they don’t agree with the Murphmonster’s prejudices they are not advancing a technical argument.

Ho hum.

Ritchie on Chinese debt

Too good to miss this one:

There are now three credit cards for every Chinese mainlander.

I believe in the need for credit, but I also believe in the control of credit. This looks out of control.

There’s a lot of potential for this to end in tears.

Comment one:

Not sure you are reading that right.

I see number of credit cards to be about 200 m units, so 1 in 6 mainlanders has a cc.

For debit cards then yes it’s 3 for 1

Ritchie’s response:

I am quoting the FT

The FT:

Ten times more of them are debit cards than credit cards (3.8bn compared with 391m), but credit card issuance also rose by 19 per cent in 2013, and Euromonitor predicts credit card usage will grow faster than that of other cards over the next five years.

Wondrous, no?

We all make errors of course but the refusal to even check when one is drawn to attention is what so impresses.

Would Starbucks pass the Fair Tax Mark?

So Ritchie asks us to pitch in with ideas for the multinational version of the Fair Tax Mark:

If anyone wants to suggest methodology they’re welcome to do so but remember the focus is on:

tax policy
transparency about what the business does
tax accounting
disclosing tax avoidance

OK.

And this is appended to a piece that states the following:

Much of Starbuck’s good work building up a positive corporate social responsibility profile over sustainability and support for fair trade products was undone when it was revealed to have paid no tax for 14 out of the 15 years it had been operating in the UK.

Excellent. So. let us consider whether Starbuck’s would gain any conceivable version of the Fair Tax Mark?

I think it’s fairly obvious that they would not given that the entirely manufactured furore about their non-payment of tax is being used as a justification for the existence of the Fair Tax Mark.

However, this is something of a problem as Starbuck’s really was making a loss and their accounts did indeed reveal everything that was necessary to check this. There were really only two things out of the ordinary at all. The first was payment of royalties for the brand name into a Dutch company. This is entirely normal practice, indeed we’ve EU law to tell us that it’s illegal to try and tax such payments at source. Hell, HMRC even reviewed the rate and it was adjusted to one they would prefer.

The second was the payment of a 20% margin to the coffee bean purchasing operation in Switzerland. Again, there’s nothing unusual or even dodgy about this. Some money should be paid as margin to a bean purchasing organisation. Not to do so would of course be manipulating transfer pricing regs. For any arms length supplier would clearly be trying to charge a margin on its services: thus a wholly owned one should as well.

All of this was entirely obvious in the accounts. As was the fact that even if you adder these back in then the UK arm was still making a loss.

Which brings us to an interesting question. If a company that had clear accounts, was not dodging tax, a company like Starbuck’s, would not get the Fair Tax Mark, then what use is said Mark? And if it would get it then how can anyone be using Starbuck’s as an example of why we need said Mark?

Ritchie on the IMF paper

This will, of course, be a complete shock to neoliberal economists. The whole logic of their approach is that without the differential of inequality then there is no incentive for growth. This study shows that is not just not true, but that the reverse is true.

Actually, to anyone with an understanding of both human nature and economic reality (neither apparently possessed by neoliberal economists and so absent from the assumptions which automatically lead to the conclusions of their work) this finding is glaringly obvious.

Wondrous. He takes a paper that says that modest action to remove glaring inequality is a pretty good idea and then uses it to insist that therefore we should reduce all inequality.

It’s worth noting that the database used in the paper does not include the Soviet block, either the USSR in the 1920s or Eastern Europe post WWII. You know, when very strong efforts were made to reduce inequality and these had something of an impact upon growth?

It gets better though:

Let’s deal with the economics first. Reduced inequality inevitably means a broader base of ownership for capital. That means more people have access to opportunity to create businesses and unsurprisingly increased growth will follow.

The IMF paper is a study of income inequality, not wealth inequality. Thus access to capital has nothing to do with it at all.

Ritchie is complaining about charities being political

The consequences are obvious, but to take a simple example, the deeply right wing Institute for Economic Affairs is a charity because it, apparently, does not offer political opinion and yet to question the role of the market is, apparently, political. The dichotomy is obvious, unless of course, you’re a neoliberal. Then it’s natural.

This from a man who gets £35k a year from a charity to be political?

This is absolutely fascinating

From someone wibbling in a guest blog at Ritchie’s:

Ignoring for a moment Barclays role in the recent LIBOR scandal and its impact on public finances, the real public procurement issue appears when we explore Barclays corporation tax profile, and the implications of tax avoidance on public sector finances.

Local government is reliant upon central government grants for its survival, so you might think that Barclays paying a shockingly low 1% effective tax rate on £11.6bn UK profit in 2010 may be cause for alarm within public procurement circles. You would be wrong.

Justin Thompson, Director of Social Inclusion, Knowsley Metropolitan Borough Council said that: “if you can’t measure it, from a procurement perspective, it doesn’t exist.”

Justin is correct. Through my procurement research, I knew council banking procurement is completely silent on tax avoidance and the use of tax havens. As councils do not measure corporate tax avoidance within procurement, they effectively pretend it does not exist.

As the session was opened up to questions from the floor, I asked Nick Starkey how we could take social value commissioning seriously, whilst public procurement frameworks continue to ignore the glaring issue of corporate tax avoidance by firms like Barclays, which robs councils including Oldham of the taxes required to fund basic services including schools?

Starkey’s response was that he would need to take the issue up with HMRC.

With brutal 34% austerity cuts to council funding since the 2008 banking crisis and 2010 budgetary review, anger at the banks runs deep within local government.

A motion for a UK Robin Hood Tax on financial transactions has now been passed by 46 UK local authorities, where the proceeds of the Robin Hood Tax would fund struggling public services impacted by austerity cuts stemming from the banking crisis.

In the past fortnight, a new campaign known as the ‘Fair Tax Mark’ has launched to attempt to reframe the tax debate, by promoting the payment of fair taxes as a badge of honour, and point of differentiation vs tax avoiding competitors.

There is no industry where a Fair Tax Mark is more urgently needed than the UK banking and financial services sector, where corporate tax avoidance is not only the modus operandi for the banks themselves, but a highly profitable consulting business.

I well recall that Barclay’s tax bill.

The reason that the bill was low was because Chuka Umunna (yes, it was he) was comparing the UK corporation tax bill against global profits. And there were a few adjustments that needed to be made. For example, Barclay’s made a vast profit (some 50% of all of them) by selling off a subsidiary. On which they gained the substantial shareholding exemption (SSE, the same thing used by The Guardian more recently). Something specifically brought in by Gordon Brown so this was within both the letter and the spirit of the law. There were also tax losses from previous years to bring forward: again, entirely spirit and letter of law stuff. Further, there were taxes paid to other governments abroad where Barclays had made profits abroad.

All leading to Barclays having a small liability of UK corporation tax. And the thing is none of this was about evasion, avoidance, tax abuse or anything else. It was the straight and strict application of both the spirit and letter of tax law.

Which leads to an interesting conclusion. That Barclay’s tax bill would almost certainly pass the Fair Tax Mark. Yet it is that very bill itself that is being used as the justification for why there should be a shakedown operation Fair Tax Mark in hte first place.