[A-List] US imperialism: Gibraltar (!)

["Michael Keaney" <michael.keaney@xxxxxx>]

Lou Proyect has, elsewhere, highlighted the lead article in the latest
edition of Policy Review, the political periodical published by the Hoover
Institution, Stanford University. Long a home of fearsome rightwingery, it's
no surprise that its journal should live up to its reputation. One minor
advantage of this, nevertheless, is that the musings of those who get
published by Policy Review can be taken as read as being at least
influential within policymaking circles around the current administration.
That's what makes this particular piece on the current situation in
Gibraltar so interesting. It's been argued here that part of Blair's
"modernisation" of the British state involves getting rid of anomalies like
Gibraltar and Northern Ireland, which are all part of the EU now and can be
"administered" at much less cost from the centre rather than directly as at
present. The British state has much bigger fish to fry than a few square
miles of rock in the Mediterranean. However, the US state appears to have
even bigger fish to fry, although we should not discount the motive unspoken
in the following extract -- i.e., lingering disharmony between Britain and
Spain only adds to the difficulties of deepening European integration, which
is all to the good, if we are to believe the growing chorus of writers
warning US policymakers about the ultimate challenge posed by Europe.

And the author is breathtakingly amnesiac, if you consider the stance of the
Bush administration towards the OECD's efforts to close down the
international tax loopholes.

------

Gibraltar on the Rocks

By Thomas D. Grant
Policy Review, No. 116
December 2002 - January 2003

<snip>

Haven of regulatory competition

The united states recognizes that its citizens have widely ranging interests
in the banking, financial, transport, and other fields and aims to protect
these interests around the world. The United States recognizes further that
maintaining a diversity of regulatory regimes in the global market helps
protect the interests of its citizens. Regulatory competition fosters
improvement of regulatory regimes.

This is not to ignore the pitfalls of regulatory freedom on the
international stage. Regimes that stray too far from "best practices" -
especially where they invite possible abuse of a regime by money launderers,
tax evaders, or worse - must feel the brunt of international - that is,
American - ire. Gibraltar in fact numbered among the places that faced
serious questions in recent years about its own tax and regulatory system.
In most particulars, the Gibraltarian government of Peter Caruana has
undertaken measures satisfying international demands, most recently, on
February 27, 2002, signing on to an Organization for Economic Cooperation
and Development initiative to mitigate "harmful tax competition."

Reflecting the American view, the present U.S. Treasury Secretary, Paul O'
Neill, has expressed reservations toward measures that he believes would
excessively restrict rules at the international level on banking and
taxation. Gibraltar, in furnishing a favorable regulatory regime in key
sectors of the international economy, fosters the diversity of regulatory
regimes recognized to protect the interests of American enterprise. In
adopting new guidelines and taking reparative action with respect to past
loopholes, the territory arguably has achieved a proper balance between
regulatory liberalism and international responsibility.

It is far from clear whether the best features of Gibraltar's favorable
regulatory and tax environment would survive incorporation into Spain.
Insofar as retrocession of the territory to Spain would erode a favorable
environment, retrocession simultaneously would erode the legislative
diversity that advocates of the free market widely recognize as benefiting
American investors and entrepreneurs in the international economy.

For full article see
http://www.policyreview.org/dec02/grant.html