06

Jul

Maulwurf

Mole.

It was announced on July 4 that a U.S. spy was caught in the German foreign intelligence service (BND).

The federal prosecutors in Karlsruhe are investigating a 31-year-old BND employee for selling secret documents to an American contact man. The BND employee also offered his services to the Russians. It’s still not clear whether the person he thought was his American contact man was actually American and from a U.S. intelligence agency.

Update on 05 Jul 2014: Germany’s domestic intelligence agency, Verfassungsschutz, is responsible for protecting the country from foreign spies. Apparently when Verfassungsschutz started investigating this mole they asked the U.S. for help.

Update on 09 Jul 2014: Military Intelligence (MAD) may have found a second U.S. spy inside the Defense Ministry.

(M OW! L voorf.)

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06

Apr

NSA-Untersuchungsausschuss

N.S.A. investigative committee of the Bundestag, which began meeting on 03 Apr 2014.

The committee’s chair is Clemens Binninger (C.D.U.), a former policeman.

It is tasking itself with investigating the involvement of German police and intelligence agencies—domestic, foreign and military—in the massive spying on people and companies that is now known to have been done by the U.S. and U.K. governments and their contractors.

Also it will now be investigating Germany’s culpability in the U.S.’s drone wars. Since the Süddeutsche Zeitung, Norddeutscher Rundfunk (NDR) and Westdeutscher Rundfunk (WDR) reported that the U.S. is using its Ramstein airbase inside Germany to support drone attacks in Somalia, Yemen and Pakistan, violating international law while killing hundreds of civilians, Germany’s government (C.D.U./C.S.U. + S.P.D.) can no longer pretend they don’t know this is happening.

The committee repeated that they would like Edward Snowden and other informed whistleblowers to give statements and answer questions for these Bundestag inquiries. Journalists repeated that the whole world will be watching this inquiry to see what the committee discovers and which stones they leave unturned.

Update on 09 Apr 2014: Clemens Binninger stepped down as chair of the N.S.A. investigative committee after only six days. He said he was resigning from the position because he felt people from the opposition parties were too interested in hearing from N.S.A. whistleblower Edward Snowden.

Update on 10 Jul 2014: A Spiegel article about Germans’ angry responses to spying by the U.S. mentioned that Clemens Binninger is chairing the Parlamentarisches Kontrollgremium, the secret Bundestag committee supposed to monitor Germany’s intelligence agencies.

(Enn ess ah   oon tah ZOO chh oongs OW! ss shoes.)

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26

Feb

Verrechnungspreismissbrauch

Transfer pricing tax evasion.

Under international finance rules that allowed corporations to assign profits earned by subsidiaries in countries with taxes to subsidiaries in countries without taxes, an online documentary explained, commodities companies could avoid taxes in source countries by having their extracting subsidiary sell the commodity to subsidiaries abroad at prices that did not reflect market prices, moving around on-paper profits and on-paper losses. The tactic is called transfer pricing. Rules supposed to prevent it required among other things that divisions of the same organization deal with each other “at arm’s length,” as if they were not part of the same organization.

Profits from this and other paper shuffles can apparently show up decades later and inflict serious fiscal damage on countries, even countries with the resources to give government auditors enough training to stand up to international corporations’ negotiators. In 2013 Rupert Murdoch’s giant News Corp. appears to have received the “largest cash payout from the Australian Tax Office ever,” a rebate of US$800 million for some on-paper loans to itself made in 1989. The money showed up in News Corp’s U.S. subsidiary’s Q4 2013 accounts as a US$800 million payment from “a foreign tax authority.” The original deduction was estimated by the Australian Financial Review at AU$600 million, but it was decided that News Corp was owed additional interest on it of almost AU$300 million.

The huge payment is being described as a substantial inconvenience or “blowout” to the current Australian federal budget. Last summer then-Australian prime minister Kevin Rudd accused News Corp companies in Australia of running a “ferocious” media campaign against his government, including accusing the Labour government of overspending. Kevin Rudd lost the Australian election to Tony Abbott on 07 Sep 2013.

This is how the tax deduction happened, according to an online 17 Feb 2014 article from the Australian Financial Review:

“In a 1989 meeting, four News Corp Australia executives exchanged cheques and share transfers between local and overseas subsidiaries that moved through several currencies.

“They were paper transactions; no funds actually moved. In 2000 and 2001 the loans were unwound. With the Australian dollar riding high, News Corp’s Australian subsidiaries recorded a $2 billion loss, while other subsidiaries in tax havens recorded a $2 billion gain.

“By last July that paper “loss”, booked against News Corp’s Australian newspaper operations, had become an [A]$882 million cash payout.

“Under a legal arrangement when the company was spun off last June, News was forced to pass all of the tax payout to Mr Murdoch’s 21st Century Fox.

“News Corp said it had retained $A81 million because it faced income tax charges on the interest payments by the Tax Office. However it seems unlikely to actually pay these funds: News Corp Australia carried another $1.5 billion in tax deductions from a separate paper shuffle that it made when News reincorporated in the US.”

(Fair ECHH noongs price mis BROW chh.)

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20

Feb

Betriebsrat und Gesamtbetriebsrat befürworten

Advocating for a factory workers council and a corporation workers council.

Volkswagen’s organizational structure includes the legally-mandatory German committee of workers that is allowed a say in co-managing their workplace: the Betriebsrat. Recently the U.S.’s United Auto Workers union, quietly supported by VW management, tried to “unionize” a factory in Tennessee but was voted down by the workers themselves. U.S. media described it as a vote against union representation, while German media apparently initially reported that the workers had rejected forming a Betriebsrat. They followed up by saying the company had thought unionization was the logical first step for creating a works council at the Chattanooga factory but now they’ll just have to do it another way. “Our employees did not make a decision saying they’re against a Betriebsrat,” plant C.O.O. Frank Fischer reassured German reporters.

Had Chattanooga’s workers voted yes, they would have also gotten a seat on VW’s Gesamtbetriebsrat, apparently a workers’ council for the entire corporation consisting of employees representing VW’s ~105 locations around the world.

Since unionized U.S. auto manufacturing workers were made to seem responsible for the results of inferior car design decisions in the 1970’s, many potential employees appear to not support unions because they fear their own laziness. Fearing your own and others’ laziness seems to be part of the human condition in the U.S. but that fear isn’t as strong in Germany. It’s been interesting to me to see how Germans handle the balance of working hard, <40 hours/week, and then playing hard the rest of the time with a clear conscience, rather than coasting through a twilight lifetime of trying to live at the workplace without sufficient time off.

Süddeutsche.de and Spiegel.de both mentioned that the U.S. has a National Labor Relations Board that must still confirm the plant’s unionization vote and where objections can be filed. U.S. reporting mentioned that U.S. senators are protected under “freedom of opinion” from being sued for spreading disinformation.

(Bet REEBZ rott   oont   gez OMT bet REEBZ rott   beh FIR wort en.)

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11

Feb

Doch drohnenfähige Handydaten!

Cell phone data are droneable after all!

Last summer Germany’s foreign intelligence service, the Bundesnachrichtendienst or BND, admitted they’d been sharing phone data with U.S. intelligence agencies for years but said it was okay because cell phone data couldn’t be used to locate people and something about the N.S.A. promised not to use German-supplied phone data to kill anyone. Regarding the first claim, whistleblowers from U.S. drone programs have now explained to reporters how phone data were used for targeting assassinations around the world.

One whistleblower, describing countermeasures persons of interest have taken to keep using phones while evading geolocation and how these countermeasures can deliberately or accidentally increase the drone strikes’ already terrible civilian casualties, called the U.S. drone programs “little more than death by unreliable metadata.”

Details from the article and online discussions included:
“Pods” on U.S. drones (and presumably on urban utility poles because this might be what police have been quietly installing in U.S. cities using Dept. of Homeland Security funds) can spoof cell phones into providing data and can vacuum information off wifi networks from altitudes of four miles. Telecommunications standards in some “countries of interest” make it possible for many users there to share data the U.S. uses to identify targets’ cell phones. Wireless “party lines” quietly shared by pools of low-income civilians increase the chances that countries indulging in drone assassinations will accidentally kill party line participants and their families and neighbors, or be tricked into killing their enemies’ enemies, such as by firing missiles at wedding parties or legislatures after someone hides a cheap phone there.

(Daw chh   drone nen fey igga   HEN dee dotten.)

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10

Nov

L.I.B.O.R.-Klagen

L.I.B.O.R. lawsuits.

The U.S. company Fannie Mae has filed complaints seeking about half a billion euros in damages from multiple banks around the world for L.I.B.O.R. benchmark interest rate manipulation. Deutsche Bank is one of the defendants.

Update on 01 Nov 2013: ZDF heute journal financial correspondent Frank Bethmann said the many banks found to have participated in L.I.B.O.R. manipulation have been fined about 2.7 billion euros total by the world’s bank oversight authorities alone so far. Now more and more company lawsuits keep “fluttering in,” making them possibly the costlier threat. He said Deutsche Bank had now set aside 4.1 billion euros for legal fees. “But that shirt could prove too short as well, particularly in the U.S.A.”

Update on 06 Nov 2013: FAZ.net reported that insiders told Reuters news agency that before 2014 the E.U. competition commissioner wants to fine six banks a total of 1.5 billion euros for L.I.B.O.R. benchmark manipulation, including Barclays, Royal Bank of Scotland (R.B.S.), the Dutch Rabobank (“genossenschaftlich” bank meaning it started life as a mutual?), and the “broker” I.C.A.P. The Swiss bank U.B.S. will be excused from this fine—said to be the largest bank fine in E.U. history—because they were the first to testify. These six banks admitted this particular wrongdoing and as a result the E.U. said it will reduce those fines by 10%.

This set of fines is for the yen L.I.B.O.R. manipulation subscandal of the L.I.B.O.R. manipulation scandal. Deutsche Bank may be facing additional U.K. and U.S. fines for U.S. dollar L.I.B.O.R. manipulation.

Financial regulators around the world are also investigating more than a dozen banks for Eur.I.B.O.R. benchmark manipulation. On 06 Nov 2013 FAZ.net reported that insiders said the E.U. Commission was negotiating fines to half a dozen banks for that as well, including Deutsche Bank and possibly Royal Bank of Scotland and Société Générale. FAZ.net reported the U.K.’s Financial Times reported each of these six will have to pay up to 800 million euros for that set of fines. And that Bloomberg.com reported the British bank H.B.S.C. had withdrawn from those fine negotiations, giving up the proffered 10% fine rebate for admitting wrongdoing.

German Wikipedia said the Eur.I.B.O.R. is set on the basis of data submitted by 32 European “credit institutions,” minus the top 15% and bottom 15% outliers, to the “information agency” Thomson Reuters. The Eur.I.B.O.R. is then published by Reuters.

English Wikipedia said the Eur.I.B.O.R. was created by combining “domestic” benchmark rates, such as from Paris, Frankfurt and Helsinki, in 1999. It said there is still a separate Euro L.I.B.O.R. set in London, based on data from 16 banks.

(LEE boar CLOG en.)

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04

Nov

Festnahmeersuchen

Arrest request.

Edward Snowden cannot apply for German asylum before entering German territory. Members of the government could then issue him an Aufenthaltserlaubnis but it might not prevent his deportation to the U.S.A., because that country prudently filed a Festnahmeersuchen [“(intergovernmental) arrest request”] with Germany last summer. There are deportation agreements [Auslieferungsabkommen] between the E.U., Germany and the U.S.; to prevent deportation under those agreements an “obstacle reason” or estoppel [Hinderungsgrund] must be cited, “for example, that Germany considers the deed he is accused of to be a political crime,” said Frank Bräutigam, ARD law reporter, who added that the decision or “last word” lies with the Justice Ministry, of course in coordination with the entire cabinet. The Justice Ministry would have to make a clear statement that “Germany will not deport him.” Heribert Prantl wrote in Süddeutsche.de that the Interior Ministry is responsible for issuing Mr. Snowden’s Aufenthaltserlaubnis, but the courts and Justice Ministry are responsible for the more important question of deportation.

Bundestag member Petra Pau (Leftists; she appeared to do a great job in the parliamentary committee investigating the investigations of the neonazi serial killers) said on Nov. 1 that she could not recommend that Mr. Snowden travel to Germany under current circumstances, “because at the moment I see no one who can guarantee his safety.” Süddeutsche.de’s Heribert Prantl reminded his readers of the story of reformer Jan Hus in 1414 C.E., who received a letter of safe conduct, “sicheres Geleit,” from the Holy Roman Emperor yet was burned at the stake as a heretic.

ARD tagesschau.de showed residency-relevant paragraphs from what appeared to be a 2008 version of a residency law [Aufenthaltsgesetz, AufenthG]:

“565. Gesetz über den Aufenthalt, die Erwerbstätigkeit und die Integration von Ausländern im Bundesgebiet (Aufenthaltsgesetz, AufenthG). In der Fassung der Bekanntmachung vom 25 Feb 2008 (BGBl. I S. 162). […]” 565. Law on residency, employment and integration of foreigners in Federal German territory (Aufenthaltsgesetz, AufenthG). In the version promulgated 25 Feb 2008 (Federal Gazette I p. 162). […]
“Abschnitt 5. Auftenthalt aus völkerrechtlichen, humanitären oder politischen Gründen. Section 5. Residence due to reasons of international law [Völkerrecht, “peoples law”], humanitarian reasons or political reasons.
“§22 Aufnahme aus dem Ausland. (1) Einem Ausländer kann für die Aufnahme aus dem Ausland aus völkerrechtlichen oder dringenden humanitären Gründen eine Aufenthaltserlaubnis erteilt werden. (2) Eine Aufenthaltserlaubnis ist zu erteilen, wenn das Bundesministerium des Innern oder die von ihm bestimmte Stelle zur Wahrung politischer Interessen der Bundesrepublik Deutschland die Aufnahme erklärt hat. (3) Im Falle des Satzes 2 berechtigt die Aufenthaltserlaubnis zur Ausübung einer Erwerbstätigkeit.” §22 Admittance or acceptance from outside Germany. (1) An Aufenthaltserlaubnis can be issued to a foreigner for acceptance into Germany from abroad for international law reasons or urgent humanitarian reasons. (2) An Aufenthaltserlaubnis is to be issued when the Interior Ministry or the office they nominate has declared acceptance to protect political interests of the Federal Republic of Germany [emphasis of ARD tagesschau.de and ZDF heute journal]. (3) In the case of (2), the Aufenthaltserlaubnis shall include a work permit.

Another possibly fruitful area or “construction site” ARD tagesschau.de mentioned is the possibility that the federal prosecutor [Bundesanwalt] in Karlsruhe might use the Criminal Code [Strafgesetzbuch] to investigate certain individuals for spying on Germany.

“§99. Geheimdienstliche Agententätigkeit. §99. Secret service agent activity.
“(1) Wer (1) Whosoever
“1. für den Geheimdienst einer fremden Macht eine geheimdienstliche Tätigkeit gegen die Bundesrepublik Deutschland ausübt, die auf die Mitteilung oder Lieferung von Tatsachen, Gegenständen oder Erkenntnissen gerichtet ist, oder 1. performs a secret service activity against the Federal Republic of Germany for the intelligence service of a foreign power, said activity being directed toward the communication or delivery of facts, objects or knowledge, or
“2. gegenüber dem Geheimdienst einer fremden Macht oder einem seiner Mittelsmänner sich zu einer solchen Tätigkeit bereit erklärt, 2. declares himself or herself willing to perform such an activity to the intelligence service of a foreign power or one of their middlemen
“wird mit Freiheitsstrafe bis zu fünf Jahren oder mit Geldstrafe bestraft, wenn die Tat nicht in § 94 oder § 96 Abs. 1, in § 97a oder in § 97b in Verbindung mit § 94 oder § 96 Abs. 1 mit Strafe bedroht ist. will be punished with imprisonment [Freiheitsstrafe, “freedom punishment”] of up to five years or with a fine if the action is not punishable in accordance with §94 or §96 section 1, in accordance with §97a or in accordance with §97b in conjunction with §94 or §96 section 1.
“(2) In besonders schweren Fällen ist die Strafe Freiheitsstrafe von einem Jahr bis zu zehn Jahren. Ein besonders schwerer Fall liegt in der Regel vor, wenn der Täter Tatsachen, Gegenstände oder Erkenntnisse, die von einer amtlichen Stelle oder auf deren Veranlassung geheimgehalten werden, mitteilt oder liefert und wenn er […]” (2) In especially severe cases, the punishment shall be imprisonment from one year to up to ten years. An especially severe case is usually a case where the offender communicated or delivered facts, objects or knowledge kept secret by an official office or upon their order, or when the offender […]

und so weiter und so fort.

Tagesschau.de reported, “The federal prosecutor in Karlsruhe recently reconfirmed to ARD that relevant German authorities had been requested to send in their knowledge/ideas/facts [Erkenntnisse] regarding the bugging of the chancellor. No official preliminary investigative proceedings have been opened yet. Only after that happened would it be possible for Mr. Snowden to testify as a witness in criminal proceedings.”

(FEST nom eh eah ZOO chh en.)

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29

Oct

Bankendaten-Transfer ausgesetzt

Stopped the transfer of banking data.

On 23 Oct 2013 members of the European Parliament parties the Social Democrats, Greens, Leftists and (libertarianesque) Liberals voted 280 to 254 to stop providing bank transfer data to the U.S. under the S.W.I.F.T. agreement until more is done to fix the U.S.’s disrespect for data protection worldwide. Bank transfers have replaced checking in Europe, and the E.U. had originally, reluctantly, agreed to let the U.S. access bank transfer data in order to help fight terrorism.

Only four E.U. countries, including Five Eyes member Britain, and the German C.D.U./C.S.U. M.E.P.’s remained in favor of the status quo (this was before revelations that the U.S. had bugged the cell phone of Chancellor Merkel (C.D.U.)!). France was leading the protest, especially after articles in Le Monde that week about the vast extent of N.S.A. spying in France, slurfing tens of millions of French phone calls in just one 30-day period. The angry M.E.P.’s wanted the U.S. to, among other things, be honest and precise about what its organizations have been doing. An anonymous committee member was quoted in Spiegel.de as saying they know now that the U.S. does not change anything until after you stand up and say no to them.

The European Parliament decision to stop providing S.W.I.F.T. transfers data still must be approved by 2/3 of the 28 member states. The coalition of proponents doesn’t quite have those numbers yet, but lately U.S. intelligence agencies tend to help their opponents by delivering new outrages rather than, say, providing honest and precise information about what they, the myriad private contractor intelligence companies the U.S. hires, and their public and private partners around the world, have been doing.

Some goals, from the press release for the nonbinding solution:

“Parliament stresses that any data-sharing agreement with the US must be based on a consistent legal data protection framework, offering legally-binding standards on purpose limitation, data minimisation, information, access, correction, erasure and redress.”

Update on 27 Nov 2013: E.U. interior commissioner Cecilia Malmström (Swedish Liberal People’s Party, conservative-liberal, liberal with the non-U.S.A meaning of libertarianesque) announced that the commission was negating the E.U. parliament’s decisions to stop sharing E.U. air passenger data and S.W.I.F.T. bank transfer data with the U.S.A. “to fight terrorism” because, she said they said, there was no evidence the U.S. had violated the agreements. And, the E.U. Commission was also not going to change the toothless self-policing “Safe Harbor” data protection agreement: justice commissioner Viviane Reding has given the U.S. a 13-point data protection homework assignment to implement by summer 2014, after which the E.U. will re-examine torpedoing “Safe Harbor.”

(BONK en dot en   TRONZ fair   OW! z’gez ets t.)

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28

Oct

Anti-F.I.S.A.-Klausel

Anti-Foreign Intelligence Surveillance Act clause.

E.U. justice commissioner Viviane Reding has had trouble passing her data protection reform. Years of debates, thousands of amendment proposals, successful lobbying by U.S. companies and successful pressure from U.S. governments. But now everyone’s mad.

On 21 Oct 2013 the European Parliament passed data protection reforms. They updated 18-year-old rules that were obsolete and also loose enough to let the lawscape vary from country to country, enabling internet companies such as Facebook to shop for Member States with laxer data protection laws such as Ireland.

The so-called “anti-F.I.S.A. clause,” which regulates sharing of E.U. burgher data with so-called third-party countries, had actually been politely deleted in response to pressure from the U.S. government and lobbying from large U.S. companies, according to a June 2013 Spiegel.de article. Because everyone’s mad, the responsible “Libe” civil liberties committee put the anti-F.I.S.A. clause back into the proposed reform and it has now been passed by the European Parliament.

Spiegel.de summarized the key points:

  • Sanctions for violating European data protection rules have been “drastically” raised, to up to 5% of a company’s annual worldwide gross. Earlier this year Frau Reding had had to accept a compromise of a 2% maximum fine, but no more!
  • “Privacy by design,” which means, Spiegel.de wrote, “Companies must design their [websites] to be as [data-frugal] as possible, with the most data-protection-friendly default settings. They must also give their users the option of using their services anonymously and pseudonymously.”
  • “Explicit consent” by users to processing and sharing of their data. The explicit consent cannot be given in small print such as an end-user license agreement. Standardized easily recognized symbols must be included in the request for consent. Companies will not be allowed to create a user profile of users who forbid them to create one.
  • More guardians. Companies dealing with data from more than 5000 people will have to hire a data protection officer.
  • A European Union data protection council will be created to watch over these rights and abuses. To submit a complaint, burghers will only have to contact their country’s data protection office and will be able to submit complaints in their own language. The national data protection offices will escalate and forward.
  • The Libe committee was unable to get a majority vote in favor of the “right to be forgotten” this time, settling instead on a “deletion right” under which E.U. burghers will be able to force companies to tell them what data they have collected on them and then to delete it. The companies will not be responsible for ensuring that data do not appear anywhere else in the internet however, which is what a “right to be forgotten” would have meant. Spiegel.de said German data protection law is stronger here.

It’s not over yet. The European Parliament must now agree on a final version of the reform with all 28 countries in the E.U. Council and in the E.U. Commission. If the reform is not done and dusted before European Parliament elections in April 2014, it may be delayed for ridiculous lengths of time again.

(Auntie   FIE zah   cl OW! zell.)

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26

Oct

Beseeltes Lächeln und im Sorgen um Amerika gekräuseltes Stirn

A ZDF heute journal reporter’s description of U.S. Senator Ted Cruz’s unique look: his beatifically uplifted smile, his forehead wrinkled with concern about America.

(Beh ZALE dess   LAY chh hell n   oont   im   ZOR-R-RG en   oom   om AIR eek ah   geh CROY zell dess   STEER n.)

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16

Oct

Büro für Berufliche Verantwortung

“Office for Professional Responsibility,” an in-house ethics watchdog. In the U.S.A.’s federal government, e.g. the I.R.S., F.B.I., Immigration and Customs Enforcement at the Department of Homeland Security each has one, and the Justice Department has one. Serious criticisms written by U.S. judges are apparently supposed to be reported in the Justice Department to your supervisor and then on to Justice’s Office for Professional Responsibility.

A Freedom-of-Information-Act request by USA Today found that the Justice Department’s Office for Professional Responsibility not only did not investigate the scathing criticism of the N.S.A. written by at least two judges on the secret Foreign Intelligence Surveillance Act court supposed to monitor the agency, but Justice’s Professional Responsibility office had no record of having heard about it.

The F.I.S.A. judges objected to the N.S.A.’s lying to the F.I.S.A. court.

(Byoo ROE   foor   beh ROOF lichh eh   fer AUNT vort oong.)

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09

Oct

“Das Geld dafür geben die Anderen”

“Other people are paying for it,” how financial reporter Frank Bethmann commented the U.S. company Verizon’s “schwindelerregend” offer of $130 billion to buy out British partner Vodafone’s stake in their U.S. joint venture Verizon Wireless. In the 02 Sep 2013 announcement of the sale, Verizon said as part of it they intended to borrow $25 billion one week later at the currently very low interest rates; that would have been the largest amount ever borrowed by a company in the history of the world apparently.

Update on 12 Sep 2013: Verizon’s $49 billion Unternehmensanleihe [“company loan” i.e. corporate bond] “emission in eight tranches at varying interest rates and terms to investors around the globe” was the biggest ever, according to manager-magazin.de, adding that the takeover itself was also the third-biggest ever.

This is not the only vertiginous telecom merger in the works. There’s two in the German market as well.

On 23 Jul 2013, Spanish Telefónica’s German subsidiary O2 announced that it wanted to buy the Dutch KPN’s German subsidiary E-Plus, though “only” for five billion euros. The resulting company would become the German market’s largest mobile phone provider (43 million customers), followed by Deutsche Telekom subsidiary T-mobile (37 million customers) and then the British Vodafone (32 million c.). The merger required approval from German and E.U. competition authorities.

Update on 12 May 2014: The German Monopoly Commission [Monopolkommission] told the Frankfurter Allgemeine Zeitung they expect the E.U. to set serious competition-saving conditions for approving Telefónica’s acquisition of E-plus, including that there will still be four mobile telephony providers in the German market after the merger. “Abstract concessions and offers won’t do it.” Three mobile phone providers competing in the German market would not suffice because E-plus was the one that stirred up the market the most and it would be the one disappearing.

Update on 13 Sep 2013: Now British Vodafone is purchasing the Munich-based Kabel Deutschland, “Germany’s biggest cable network operator,” at ~8.5 million television households,” for ~11 billion euros (~7.7 billion for ≥75% of Kabel Deutschland’s stock and the rest to cover Kabel’s debts; stock cost to be announced Monday 16 Sep 2013), according to Spiegel.de and manager-magazin.de. This will increase Vodafone’s competitiveness with Deutsche Telekom in the German market selling wireless and landline telephonery, television cable and internet access. European competition authorities approved the deal on 20 Sep 2013.

Huge telecom mergers & acquisitions could be motivated by more than just the roseate future of voice and internet communications plus current rock-bottom interest rates. If telecom industry people believe governments will stop defending net neutrality and consumer privacy, they will fear they must join a large existing telecom and fight to expand it, or die. They will not think risky entrepreneurship or small-to-medium-sized companies are an option. If a telecom gets big enough in a deregulated market that includes suspicionless surveillance, the money will sort itself out somehow. In regulatory situations where governments have to grant unusual concessions to big telecoms, governments will grant unusual concessions to big telecoms.

(Doss   GELD   dah foor   gay ben   dee   ON dare en.)

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05

Oct

Mätzchen

Gimmick, hokum, antics. Stunt, scheme, trick, ploy. Word used in German reporting about the U.S. government shutdown caused by some legislators’ refusal to pass a six-week budget.

(METS chh en.)

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30

Sep

Fluorwasserstoff, Ammoniumhydrogendifluorid, Natriumfluorid

Hydrogen fluoride, ammonium hydrogen difluoride, sodium fluoride.

What did your country’s companies export to the Assads’ Syria that could have been used to hurt civilians?

These are three of the chemicals German companies exported tons of to Syria between 2002 and 2006 that could have been used to make chemical weapons, at a time when the Assad regime was known to have a chemical weapons program.

The German government’s Ministry for the Economy [Bundeswirtschaftsministerium] drew up and published a list of such chemicals, including quantities, dates and prices, that could have been used to manufacture chemical weapons and for which the government issued export permits, in response to a question submitted by the Leftists party (Die Linken) and by Bundestag member and former U.N. weapons inspector Jan van Aken (Leftists) in particular. The government supplied this information one week before a national election.

Update on 30 Sep 2013: After the national election the government supplied more information. German companies were issued export permits for “dual-use” chemicals even until 2011, after the Assads were killing peaceful Syrian protestors. From 1998 to 2011, ~300 tons of such chemicals, which could be used for civilian or military purposes, were delivered from Germany to Syria. Klaus Barthel (S.P.D.) criticized the Bundeswirtschaftsministerium for, among other things, phased provision of the truth. The Bundeswirtschaftsministerium said they reviewed the investigation and remain convinced of the plausibility of the civilian uses cited, but the C.D.U. said plausibility is not enough when dealing with regimes like the Assads’. Reporter Arnd Henze said Germany has to be especially careful in these matters because the world knows that chemical weapons were produced in Libya and Iraq “with German support.”

On 01 Sep 2013 it was announced that Britain had issued licenses to export sarin gas precursors potassium fluoride and sodium fluoride to Syria in January 2012, ten months into the uprising against the Assad family. The export licenses were revoked in July 2012 after the European Union agreed to sanctions against the Assad regime. Prime Minister David Cameron (Tory)’s office initially responded by saying the U.K. has the the most rigorous export control regime, with a computer system called C.H.I.E.F., which is how they know that though the export permits were issued at that unfortunate time no chemicals were exported under the permits. Later it was indicated this was not so. Following up, Business Secretary Vince Cable (LibDem) subsequently reported that other licenses to export sarin precursor chemicals to Syria were issued by previous U.K. governments between 2004 and 2010 (the year Mr. Cameron’s Conservative-LibDem government came to power).

Update on 09 Jul 2014: U.K. foreign minister William Hague sent a written statement to the British parliament announcing that British companies had probably exported hundreds of tons of chemicals to Syria in the 1980’s that could have been used to make chemical weapons such as sarin and VX.

(FLEW or voss ah SHTOFF,   a MOAN ee oom hee dro GAIN dee FLEW oar EAT,   NOT ree oom FLEW oar EAT.)

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12

Sep

Trennungsjournalismus vs. Journalismus der richtigen Zusammenhänge

“Separation journalism vs. journalism of correct connections.” A NiemanLab.org book review said Jay Rosen wrote that U.S. journalist ethics have been about getting the separations right and should move on to getting the connections right.

Bob Garfield made a seemingly related comment about journalistic problems with lack of context in the 02 Aug 2013 episode of National Public Radio’s “On the Media” when he said, “Journalism is pretty terrible at covering ongoing conditions. It tends to be very good covering the acute. Poverty and de-industrialization, they’re just hard to cover because they require constantly paying attention to things that are changing only very incrementally, right?” I think he went on to indicate the longer term was only two weeks though.

The wonderful Seymour Hersh mentioned the recognizing relevance problem—after substance’s having been neglected too long in favor of style—in a talk at Boston University from what may have been the first year of President Obama’s first term because health reform hadn’t passed yet.

“[T]here’s no knowledge. I can’t tell you how many times… just last weekend, a senior official was interviewed live, maybe to camera, but the interview was broadcast live on a major show by somebody who didn’t really understand what he had said. He gave away something, and the person wasn’t smart enough, though a very eminent person, wasn’t smart enough to jump on it. So you have a lack of acumen too, because it’s all gone stylish. And so there you are.”

Lacking the information you need doesn’t mean you’re not smart. But it’s everyone’s tragedy if it’s not remedied.

Speaking of style/substance and context’s deep undercurrents: In the 1990’s my fellow German history majors and I were instantly suspicious of German television news anchors who smiled. In addition to exceeding what was necessary in the exquisitely minimalist atmosphere of the time, and implicitly giving permission to models that ultimately drove news into entertainment, they appeared to be knowingly or unknowingly siding with encroaching private media empires that were trying then to undermine the decent public television channels you could still find in Germany. Some of those entrepreneurial, debt-fueled private channels have since gone broke while others resemble empires. There have been changes at the top as well: British media mogul Robert Maxwell was found floating dead next to his yacht, and Bavarian media mogul Leo Kirch died of old age after suing Deutsche Bank for accidentally bankrupting his company by managerial loose talk. For a time, Australian media mogul Rupert Murdoch’s interest in purchasing German media scared people so much they hoped Italian media mogul Silvio Berlusconi would get them instead. Today I think the smiling-news-anchors “tell” no longer applies—you can be a very good German news anchor now and occasionally smile on television!—but persistently mugging for the camera might remain a bad indicator. Sounds terrible in the context of 2013 U.S.A., criticizing someone for smiling!

F.y.i., here is NiemandLab.org’s interesting Rosen-brainstormed collection of ideas about contemporary deliberate U.S. journalistic separations:

  • Editorial functions are separated from the business side.
  • The news pages are separated from the opinion pages.
  • Facts are separated from values.
  • Those who make the news are separated from those who cover the news.
  • Truth-telling must be separated from its consequences so that journalists can “tell it like it is.”
  • The newspaper is separated from other institutions by its duty to report on them.
  • One day is separated from another because news is what’s “new” today.
  • A good journalist separates reality from rhetoric.
  • One’s professional identity must be separated from one’s personal identity as a citizen.
  • How one “feels” about something is separate from how one reports on it.
  • The journalist’s mind is separate from the journalist’s soul.

(TRENN oongz joor nah LEEZ moose   VAIR seuss   joor nah LEEZ moose   dare   tsoo ZOM en heng eh.)

11 years ago Short URL 1 Comment

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07

Sep

Aufsichtsrat für Privatsphäre und Freiheitsrechte

“Privacy & Civil Liberties Oversight Board,” oversight in this case meaning not overlooking but supervising, or at least providing their boss with advice. The White House has had one of these since 2004 when Congress established it in response to a recommendation in the 9/11 Commission Report. The advisory board has five members, nominated by the President and approved by Congress. They “serve at the President’s pleasure.”

FederalRegister.gov lists some of the board’s history and the following responsibilities.

“The Board advises the President and other senior executive branch officials to ensure that concerns with respect to privacy and civil liberties are appropriately considered in the implementation of all laws, regulations, and executive branch policies related to efforts to protect the Nation against terrorism. This includes advising on whether adequate guidelines, supervision, and oversight exist to protect these important legal rights of all Americans. In addition, the Board is specifically charged with responsibility for reviewing the terrorism information sharing practices of executive branch departments and agencies to determine whether guidelines designed to appropriately protect privacy and civil liberties are being followed[.]”

What changes could have been made to this board or other institutions that might have prevented the last decade’s vast growth in U.S.-led collection—by U.S. government agencies, international private-sector companies and friendly foreign governments’ agencies—of domestic and foreign communications? What would have kept our intelligence industry manageable and monitored and transparent enough for a democracy?

(OW! f zichh ts rot   foor   pree VOT s fare eh   oont   FRYE heights rect eh.)

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26

Aug

Autonome Tötungsroboter

Autonomous killer robots.

A Süddeutsche.de article said for years now billions have invested annually in research and development of these types of weapons by the U.S.A., United Kingdom, Israel and soon China as well. The U.S. Navy for example is working on unmanned killer submarines. The U.S. Air Force notoriously has its drones. Companies like iRobot Corp. have been delivering land-based battle robots for years, on wheels, caterpillar treads, four legs and they’re working on bipedal. Post-mounted or mobile Samsung sentries (“SGR-1”) have been erected along the North Korean border that can now be set to automatically shoot anything detectable by motion, heat or, presumably, video-analyzing software.

Opponents of the technology say it’s only a question of time until remotely operated killing machines become autonomous decision-makers. The time for people to decide on an international framework for these types of weapons is now, said a United Nations expert on extralegal killing.

Sweden, wrote Süddeutsche.de, has called for an international test ban [Testverbot] on L.A.R.’s, lethal autonomous robots, asking each country’s government to announce a national moratorium on them and to unilaterally decline to manufacture and test autonomous killer robots.

(Ow! toe NOME ah   TƏ TOONGS roe BOT ah.)

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05

Aug

Spotmarkt

Spot market, where financial instruments or commodities are sold for immediate delivery, unlike the futures market where they are sold for delivery at a later date. Wikipedia said a spot market can be an organized market, an exchange or over-the-counter (O.T.C.).

Regarding the spot market price of aluminum: Goldman Sachs was accused of bottlenecking aluminum at Goldman’s Metro International aluminum warehouses outside Detroit, increasing customers’ delivery wait times since purchasing M.I. in 2010 from six weeks to sixteen months by first lowering prices to attract a stockpile (“50,000 tons in 2008” to “~1.5 million currently”) and then, actually, trucking a minimum daily regulatory-defined shipment amount of 3000 tons back and forth among the 27 warehouses. There were also accusations of understaffing, reduced shifts and prioritizing putting aluminum into storage over taking it out. The shuttle-shuffled delays raised a premium added to the price of all aluminum, driving up the spot market price “according to an arcane formula” even for metals bought directly from mines or refineries to bypass these warehouses. While delaying delivery the warehouses also continued charging rent on the stored metal. Perfectly legal according to current international regulations, apparently set by the London Metal Exchange.

The London Metal Exchange might need more disentanglement from the entities it is supposed to regulate. According to the NYTimes.com article, it still receives 1% of the rents collected by the ~700 warehouses it regulates around the world. Until 2012 it was owned by its member regulees, including Goldman Sachs, JP Morgan Chase, Barclays and Citigroup. Many of its metals warehousing regulations were written by a board populated by executives from banks, trading companies and storage companies. In July 2012 the L.M.E. was sold to Hong Kong Exchanges and Clearing, part-owned by the Hong Kong government, for ~$2 billion. A NYTimes.com description of the 2012 sale said it “will allow the Asian company to control the world’s largest futures trading exchange for metals like aluminum, copper and zinc, as emerging market demand for commodities remains strong.” In 2012 Hong Kong Exchanges and Clearing was supposedly hoping to get an exemption from Chinese laws preventing foreign companies from owning these sorts of metals warehouses in China.

The U.S.’s Federal Reserve Board could, said NYTimes.com, quit extending exemptions that allow banks like Goldman Sachs to invest in nonfinancial enterprises. Though the Fed’s stated conditions in allowing banks to diversify into commodities investment were “only if there was no risk to the banking system” and if the deals “could ‘reasonably be expected to produce benefits to the public, such as greater convenience, increased competition, or gains in efficiency, that outweigh possible adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices,'” yet many people would say its deregulation achieves the opposite effects, that big “diversified” banks’ risk management still appears to endanger U.S. and world economies and now banks’ having bought up important infrastructure might be presenting them with irresistable temptations such as artificial bottlenecking or even information advantages not all traders always refrain from using.

Update on 25 Jul 2013: The U.S. Senate’s banking committee has criticized that the Federal Reserve is not communicating well with them. However, wrote the F.A.Z., the U.S. Congress could pass its own banking reregulation rules without waiting for the Federal Reserve.

It’s unclear whether shadow trades are involved here, but it’s also unclear why everyone hasn’t gone broke if this is how they’re doing business:

“Industry analysts and company insiders say that the vast majority of the aluminum being moved around Metro’s warehouses is owned not by manufacturers or wholesalers, but by banks, hedge funds and traders. They buy caches of aluminum in financing deals. Once those deals end and their metal makes it through the queue, the owners can choose to renew them, a process known as rewarranting.”

If Goldman is indeed paying aluminum owners, fellow speculators, to rewarrant their metal and leave it in the warehouses piling up rent owed to Goldman, that might indicate some creative profits or at least useful losses are being made.

Aluminum is economically important enough that Chancellor Angela Merkel’s government has been giving aluminum refineries, notoriously high-volume electricity consumers, various electricity rebates that must be paid for by individual consumers or “ratepayers” in their home electricity bills because, Germany’s government said, the preservation of the aluminium supply was that significant for their economy as a whole.

(SHPOTT mocked.)

11 years ago Short URL 1 Comment

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31

Jul

Sicherer-Hafen-Abkommen

“Safe Harbor accord.”

After years of discussion, on 19 Jul 2013 E.U. ministers reached an agreement on reforming their outdated data protection principles at their Lithuania meeting, agreeing inter alia that any companies wishing to do business with one of the E.U.’s 500 million citizens will have to obey the E.U.’s privacy regulations or pay fines of “up to 2% of world income,” said justice commissioner Viviane Reding.

She called into question the E.U. and U.S.A.’s current pre-millennial “Safe Harbor” personal data transfer agreement, which companies join voluntarily and in which they verify their own compliance. About a thousand companies joined the agreement, including companies that shared customers’ personal data with the N.S.A. Commissioner Reding said the U.S.A.’s Patriot Act had annulled the Safe Harbor agreement anyway. “I have already told the parliament that if [the Safe Harbor agreement] is in fact what I think it is, namely a loophole, then we’re done with it.” She is counting on German and French support for the new data protection reforms.

Update on 27 Nov 2013: E.U. interior commissioner Cecilia Malmström (Swedish Liberal People’s Party, conservative-liberal, liberal with the non-U.S.A meaning of libertarianesque) announced the E.U. Commission was not going to change the toothless self-policing “Safe Harbor” data protection agreement for now. E.U. justice commissioner Viviane Reding (Luxemburger Christian Social People’s Party and European People’s Party, center and center-right) has given the U.S. a 13-point data protection homework assignment to implement by summer 2014, after which the Commission will re-examine torpedoing “Safe Harbor.”

(ZICHH ah ah   HAW fen   OB come en.)

11 years ago Short URL 1 Comment

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27

Jul

“Relevant”

Now might mean “everything,” according to Wall Street Journal reporting about how the U.S.A.’s secret F.I.S.A. court quietly reinterpreted the word “relevant” to “empower vast N.S.A. data-gathering.”

(Ray lay VAUNT.)

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26

Jul

Geheimgericht

Secret court. In the newly exposed world of overt and covert U.S. jurisprudence, this has been called a parallel world, an underworld.

Harry Shearer commented that you can’t get laughed out of a secret court.

(Geh HIGH m geh rrrichh t.)

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08

Jul

Sich selbst als Geisel nehmen

“Taking yourself hostage.” Investigative journalism nonprofit ProPublica.org interviewed financial journalist Jesse Eislinger about bank regulation reform and the USA’s too-big-to-fail banks on 04 June 2013. Eislinger talked about the few oversized banks in the USA that get saved with taxpayer funds, and the smaller banks that don’t, and he interestingly compared the huge banks’ behavior to a scene in Mel Brooks’s Blazing Saddles when a man successfully takes himself hostage. US banks are allowed to grow too big, Eislinger said, because they claim it strengthens them to diversify into many sectors. In fact, they became and remain to this day unmanageable, as shown by the recent “London Whale” failure in 2012. When the “diversified” giant banks topple they essentially copy Mel Brooks’s autohostage joke by threatening to take out wide swathes of the US/world economy if not rescued by taxpayers. The situation is self-perpetuating as it now stands.

(Zichh   ZELBST   olls   GUY zel   nay men.)

11 years ago Short URL 1 Comment

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06

Jul

Parallelität

“Parallelism.” A rep from Angela Merkel’s CDU party said starting Monday, July 8, negotiations with the USA would run in parallel for both a free trade zone encompassing the EU and USA and for a data protection agreement.

(Pah rah lell ee TATE.)

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01

Jul

Abrisslinie

“Tear line,” used in encrypted NSA emails that contained information acquired by the NSA’s ~2001 to ~2011 bulk internet and telephony surveillance (technically possible but considered unethical in the 1990’s but then authorized by the Bush administration on 04 Oct 2001 as what became the “President’s Surveillance Program,” later “Stellar Wind”). The NSA’s Inspector General wrote in a draft 2009 report that at first the NSA merely responded to FBI and CIA questions by emailing answers that used PSP-obtained information but didn’t say where they’d learned it, and thus the program was “hidden in plain sight.” Later, the FBI and CIA wondered where this information was coming from, so the NSA used a so-called “tear line” to send bulk-surveillance info and “sanitized” info in the same email.

Why only the FBI and CIA are mentioned in this NSA report, over and over, is unclear to me because the US has more such agencies than that. The Office of the Director of National Intelligence’s website currently lists 17 “agencies and organizations,” for example, and those appear to be umbrella organizations as well. During the Bush administration attempts were made by powerful bureaucrats such as Donald Rumsfeld to move intelligence work away from the CIA to the Pentagon. What was created at Defense and how did it morph as the years passed? How was it outsourced beyond government into private contractor companies? And what about “public-private” combinations such as the industry-funded INSA (Intelligence and National Security Alliance), “one of the only business associations in Washington that include current government officials on their board of directors” according to Tim Shorrock in Spies for Hire: The Secret World of Intelligence Outsourcing (2008).

(Ob riss LIEN ee eh.)

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30

Jun

Kontaktketten klarstellen

“Contact chaining analysis,” what the NSA did with the networks of relationships disclosed by the bulk Internet metadata it collected from ~2001 to ~2011, according to a draft of a 2009 report by the NSA’s inspector general.

In case you were wondering, the IG report defined contact chaining as

“the process of building a network graph that models the communication (e-mail, telephony, etc.) patterns of targeted entities (people, organizations, etc.) and their associates from the communications sent or received by the targets.”

“Additional chaining can be performed on the associates’ contacts to determine patterns in the way a network of targets may communicate. Additional degrees of separation from the initial target are referred to as ‘hops.’ For example a direct contact is one hop away from the target. A contact of the direct contact would be described as being 2 hops away from the target. The resulting contact-graph is subsequently analyzed for intelligence and to develop potential investigative leads.”

The inspector general’s report said internet metadata was one of four types of domestic and international data vacuumed up by the NSA between ~2001 and ~2011. With occasional stops and/or restarts of one or the other category due to technical problems or legal concerns on the part of e.g. the FISA court, the NSA acquired: internet metadata, telephone metadata, internet content and telephone content.

(Con TALKED kett en   KLAH shtell en.)

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27

Jun

Auge in Auge in Auge in Auge in Auge

“Eye to eye to eye to eye to eye,” the Five Eyes alliance of data-sharing intelligence agencies from the countries of UK, USA, Canada, Australia and New Zealand.

(OW! geh   in   OW! geh   in   OW! geh   in   OW! geh   in   OW! geh)

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29

May

Kollisionsschutz

“Collision protection.” In a surprise move ~14 May 2013 the German Defense Ministry [Bundesverteidigungsministerium] cancelled its Euro Hawk drone development cooperation with the USA because the drone was not going to receive permission from civilian authorities to fly in European airspace. When the cancellation was announced, GDefense said they’d spent 550 million euros on the project, but now they’re saying 660 million. The F.A.Z. Sonntag reported GDefense knew about the “Euro Hawk” civil-airspace permission problems in 2004, three years before they signed the procurement contracts to purchase the drones. Airspace permission was denied to the unmanned surveillance drone because it lacked an adequate “collision protection” system [“fehlende Kollisionsschutz“]. Air safety authorities, business people in the aerospace industry and the German Defense Department’s own licensing office warned the Defense Ministry about the paperwork problems in 2004. Furthermore, the opposition SPD and Green Party accuse, GDefense subsequently “massively interfered” in the German Federal Court of Auditors [Bundesrechnungshof]’s attempt to do their job by investigating what the hell was going on there. On 18 May 2013 the Bundesrechnungshof auditors said they’d still not received all the documents they’d requested and some of the status reports they did receive were blacked out by censors.

Half the project’s money was spent on developing the drone vehicle in the USA and half on developing the drone’s special electronic surveillance system in Germany. The surveillance system is supposedly too large to go in other drones but could be carried by a normal plane. One Euro Hawk prototype was delivered and four more drones were going to be ordered.

The F.A.Z. Sonntag reported that serious problems occurred during the drone prototype’s delivery flight from California to Bavaria in 2011, when contact with the controlling satellite was lost twice for about ten minutes at a time and the drone deviated from its course. But the Defense Ministry did not report these problems to the Bundestag. US air safety authorities also had refused to issue airspace permission to the drone, before its 2011 transfer flight. Anti-drone activist Medea Benjamin, author of “Drone warfare: Killing by remote control,” said in a 24 Sep 2012 interview that the US air force admits about one-third of these drones have been crashing. She said apparently it’s OK for them to crash on some countries but not other countries.

The German Defense Ministry’s reason for refusing to share the information requested by the controlling authorities, the Bundesrechnungshof auditors, was agreements made with “industry partners” not to share information with third parties. A spokesman for the federal auditing authority said not receiving all the information they needed to do their jobs was “unusual. We don’t experience something like that very often.” And: “The Bundesrechnungshof has an unlimited right of inspection which the Defense Ministry cannot nullify via agreements with third parties. We can and will not accept the Defense Ministry’s limitations of our access to the files.”

On 22 May 2013, Defense Minister Thomas de Maizière (CDU) said he will let the federal auditors see all documents now, even despite putative contractual conditions agreed with the USA.

Germany has also contributed ~483 million euros to NATO’s Hawk drone (“Global Hawk”?) which is based on the same US drone and thus might also have civil airspace licensing issues.

(Coe LEE zee OWNS shootz.)

11 years ago Short URL 2 Comments

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27

May

Steuersparmodelle für Grossunternehmen angehen

“Having a go at tax savings models for large companies,” what the EU is doing now that US firms have started testifying before Congress about still-legal systems of international tax loopholes partially revealed by the “Offshore Leaks” data trove.

From the Süddeutsche Zeitung’s description of some results from the 22 May 2013 EU summit in Brussels:

“At their meeting Wednesday the 27 leaders also talked for the first time about actions to be taken against tax savings models for large companies. With an eye on corporations like Apple, Amazon or Google, which avoid taxes on a large scale, British leader David Cameron said it is time to close the loopholes. He said one has to be sure that companies are really paying taxes. France’s president François Hollande demanded action against the ‘corporations’ tax tricks.’ Irish premier Enda Kenny was put under pressure because for years Apple has been using Irish subsidiaries to save billions of euros. Kenny said there aren’t any exception rules for international corporations. Ireland’s rules for taxing companies are ‘transparent and clear.’ The EU commission now plans to submit proposals for closing corporate tax loopholes by the end of 2013.”

(SHTOY ah SHPAH mode elle ah   foor   GROSS oont ah NAME en   ON gay hen.)

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01

May

Neue Auflagen für inländische und ausländische Banken

“New requirements for domestic and for foreign banks.” A week after the EU passed a new package of bank reforms on 16 Apr 2013 intended to force European banks to operate on a more stable basis, an EU commissioner sent a letter to the USA’s Federal Reserve criticizing the Fed’s intention to impose similar terms not just on US banks within the US but on foreign banks in the US as well.

The key points in the Fed’s proposal would be to require large foreign banks to create North American holding companies for their activities there and to meet the standards US banks must fulfill for capital reserves and liquidity buffers in order to make the banks less vulnerable to failure. The Fed said in addition that the new rules were intended to mitigate risk from foreign banks’ recent tendencies in the USA to bet more strongly in capital markets, on short-term capital. The proposed provisos would apply for “large” foreign banks in the US, defined as having >$50 billion internationally and >$10 billion in the USA. Such as Barclays and the embroiled-in-scandal Deutsche Bank, “both of which have attempted to use modifications under corporate law to avoid stricter constraints in America” and both of which have received large bailouts from US taxpayers despite being foreign, the F.A.Z. pointed out.

This seems like a smart initiative taken by the US government and apparently before other governments such as the EU’s. There are dystopian science fiction novels about future earths in which only domestic banks are regulated and foreign banks go a-raiding abroad until they don’t much resemble banks any more.

(NOY ah   OW! f log en   foor   in LEND ish en   oond   ow! SLEND ish en   BONK en.)

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24

Apr

Geschäftsführung und Aufsicht in einer Hand

“Management and management oversight in one hand.” Combining monitoring and management roles into one job held by one manager supposed to check themselves.

There can be overlap in groups as well. Apparently the board of directors running a German company and the supervisory board (Aufsichtsrat) that monitors the board of directors may not contain the same people, but this exclusion does not apply in the USA where, writes the F.A.Z., e.g. when the supervisory board approves the compensation of the management board, people who happen to be in both groups will at best merely abstain from voting.

(Geh SHEFTS foor oong   oond   OW! f sichht   in   eye ner   Hond.)

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15

Apr

Die Oasen der Anderen

“The Oases of Others,” a playful film reference in post-leak financial news reporting averring that countries seem more concerned about lax tax rules abroad than they are about their own tax loopholes (i.e., the USA and the state of Delaware).

Der Spiegel reminds us that quality and variety are better bets for future growth than competing internationally in a race to the bottom. There will always be countries with lower wages, so you are better off investing in education for your people and diversifying your industries.

(Dee   oh OZ en   dare   OND er en.)

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14

Apr

Der grosse Knüppel

The big stick (actually, a Knüppel is a blackjack or sap). This week’s breathtaking breakthroughs in offshore accounting EU reform initiatives are said to have only been made possible by help from the USA, which used its very big stick of threatening to cut off uncooperative countries from the financial Mecca that is Wall Street.

Before the offshore data leak was published on 04 Apr 2013, it was Luxemburg and Austria versus 25 EU Member States regarding offshore anonymity, and now Austria is standing alone, which EU countries describe as being “isolated” and fear more than US Americans might expect.

(Dare   GROSS ah   c’nupp ell.)

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07

Apr

Inländische Steueroasen

“Domestic tax oases” inside a country. The head of the largest opposition party to Chancellor Merkel’s government coalition has accused the states of Bavaria and Hesse of acting like tax paradises within Germany by hiring low numbers of tax officials, reducing tax auditing frequencies and bruiting that about in order to attract businesses. It’s probably no coincidence that Bavaria and Hesse recently filed a lawsuit seeking to break the decades-old post-WWII reconstruction “solidarity pact” in which German states that are doing well financially pay money to German states that are not.

US state Delaware was mentioned in a “Planet Money”-style ZDF report that said it has very low taxes, very business-friendly courts, 800,000 inhabitants and 900,000 companies and is where most of the world’s firms “organize their America business.”

(E’en LEND isch ah   SHTOY er oh OZ en.)

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06

Apr

Kapitalverschleierung über Steueroasen

“Using tax oases to veil capital.” Methods for doing this were disclosed by financial data about 130,000 people, in 170 countries, >120,000 “mailbox companies,” >260 GB in >2 million documents from a time range of ~30 years sent anonymously to the International Consortium of Investigative Journalists over a year ago. The story hit the world press on 04 Apr 2013. Greek and Filipino tax authorities announced that they will be investigating. The vice president of Mongolia‘s parliament will probably have to resign. Some of the still-legal methods to create tax opacity to be gleaned from the data were shown to have been used by the Deutsche Bank in Singapore, which had an intermediary agent (Trustverwaltungsfirma, “trust administrator company”) create >300 companies in so-called tax paradises (Steuerparadise).

In response: Gerhard Schick (Green Party) suggested Germany follow France’s example of levying an additional tax on all transactions with low-tax countries, disincentivizing tax flight (Steuerflucht) by neutralizing the advantages. Joachim Poß (SPD) proposed “an international anonymous NGO and a comprehensive information exchange, starting here in Europe.” The Leftists party proposed following the USA’s example of linking tax obligations to citizenship, so that every German residing abroad would be obligated to report “their total income every year, how much property they owned in total and what taxes they had had to pay for that in the Seychelles that year. And the difference between that and their German tax obligation” would then have to be paid in Germany, said Gregor Gysi (Die Linken).

The Süddeutsche Zeitung reported that they and NDR were the two German media outlets given access to the data (of “the biggest leak in world history”), and furthermore that a representative of Finance Minister Wolfgang Schäuble requested access to the data on Thursday, 04 Apr 2013, but the SZ would not grant that request. The data were protected under freedom of the press (Pressefreiheit), which includes protecting one’s sources, the Süddeutsche wrote. Sharing the data with government authorities might endanger those sources and obstruct the SZ’s ongoing research. NDR also refused the request to share the data. Now Focus magazine seems to have acquired the data somehow.

Update on 06 Apr 2013: “I have a certain degree of pleasure from the fact that this public scandalization in all countries has very much increased the pressure,” said German finance minister Wolfgang Schäuble with quiet satisfaction on 05 Apr 2013. “And now we have better chances to make progress faster than was possible in the past.”

Critics say the German finance minister has to be kidding because everyone’s known about this for years. If Schäuble were serious, they say, his office would be drafting new legislation. Income tax is regulated state-by-state in Germany, for example, and some people are calling for it to be centralized, made into a uniform federal-level taxation system with fewer “tax bait” niches. The OECD seems to be the locus for international negotiations in response to the new information; that group wants to issue a list of proposed actions in response to the “Offshore Leaks” data trove by July 2013.

(Cop ee TALL fer SHLY er oong   üüüberrr   SHTOY er oh OZ en.)

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06

Mar

Sparen nach Rasenmäher-Methode

“Lawnmower savings method,” i.e. the USA’s unusual choice to implement across-the-board spending cuts on itself. On Tuesday, 5 Mar 2013, Jeremy Keehn wrote in Harper’s week-in-review,

“President Barack Obama blamed the sequestration on the intransigence of House Republicans; House Republicans blamed Obama’s desire for new tax revenues in addition to budget cuts and Senate Democrats’ failure to pass a replacement bill; House Democrats blamed House Republicans for spitefulness and Obama for underestimating House Republicans’ spitefulness; Mitt Romney blamed Obama for poor leadership; and lexicographers blamed the prevalence in the media of the noun ‘sequester’ on the complexity of the more proper ‘sequestration.'”

(SHPAW wren   nochh   ROZ en MAY err   met ODE eh.)

11 years ago Short URL Comments

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08

Jan

Vichy-Linke

“The Vichy Left.” Derogatory term for the left side of the aisle in USA politics.

11 years ago Short URL Comments

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