Joseph Stiglitz: Trump's America: The New Global Tax Haven? [View all]

Trump is turning America into a tax haven, dismantling safeguards and fueling inequality through global deregulation.

https://www.socialeurope.eu/trumps-america-the-new-global-tax-haven



Donald Trump is quickly turning the United States into the greatest tax haven in history. One need only note the Treasury Department’s mandate to withdraw from the transparency regime that shares the real identities of company owners; the administration’s withdrawal from negotiations to establish a UN Framework Convention on International Tax Cooperation; its refusal to enforce the Foreign Corrupt Practices Act; and massive crypto de-regulation.

This seems to be part of a broader strategy to undermine 250 years of institutional safeguards. The Trump administration has violated international treaties, ignored conflicts of interest, dismantled checks and balances, and impounded congressionally allocated funds. The administration isn’t debating policy; it’s trampling the rule of law.

But Trump does love one tax: import tariffs. He appears to believe that foreigners are footing the bill, thereby providing the money to cut taxes for billionaires. He also seems to believe that tariffs will eliminate trade deficits and return manufacturing to the US. Never mind that tariffs are paid by importers, driving up domestic prices, and are being levied at the worst time possible, just as the US is recovering from an inflationary episode.

Moreover, elementary macroeconomics shows that multilateral trade deficits reflect the disparity between domestic savings and domestic investment. Trump’s tax cuts for billionaires will widen the gap, because deficits subtract from domestic national savings. So, ironically, policies like tax cuts for billionaires and corporations increase the trade deficit.

snip