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Monday, July 21, 2014

More Reviews of Piketty's Capital in the Twenty-First Century

CapitalMore reviews of Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

July 21, 2014 in Book Club | Permalink | Comments (0)

Saturday, July 12, 2014

Piketty's Failure to Account for Tax Law Changes Makes His Wealth Inequality Claims Worthless

CapitalWall Street Journal op-ed:  Why Piketty's Wealth Data Are Worthless, by Alan Reynolds (Cato Institute):

No book on economics in recent times has received such a glowing initial reception as Thomas Piketty's Capital in the Twenty-First Century (Harvard University Press, 2014). He remains a hero on the left, but the honeymoon may be drawing to a sour close as evidence mounts that his numbers don't add up.

Mr. Piketty's headline claim is that capitalism must result in wealth becoming increasingly concentrated in fewer hands to a "potentially terrifying" degree, on the grounds that the rate of return to capital exceeds the rate of economic growth. Is there any empirical evidence to back up this sweeping assertion? The data in his book—purporting to show a growing inequality of wealth in France, the U.K., Sweden and particularly the United States—have been challenged. And that's where the story gets interesting.

In late May, Financial Times economics editor Chris Giles published an essay that found numerous errors in Mr. Piketty's data. Mr. Piketty's online Response to FT was mostly about Europe, where the errors Mr. Giles caught seem minor. But what about the U.S.?

Mr. Piketty makes a startling statement: The data in his book should now be disregarded in favor of a March 2014 Power Point presentation, available online, by Mr. Piketty's protégé, Gabriel Zucman (at the London School of Economics) and his frequent co-author Emmanuel Saez (of the University of California, Berkeley). ...

Zucman-Saez concludes that there was a "large increase in the top 0.1% wealth share" since the 1986 Tax Reform, but "no increase below the top 0.1%." In other words, all of the increase in the wealth share of the top 1% is attributed to the top one-tenth of 1%—those with estimated wealth above $20 million. This is quite different from the graph in Mr. Piketty's book, which showed the wealth share of the top 1% (which begins at about $8 million, according to the Federal Reserve's Survey of Consumer Finances) in the U.S. falling from 31.4% in 1960 to 28.2% in 1970, then rising to about 33% since 1990.

In any event, the Zucman-Saez data are so misleading as to be worthless. They attempt to estimate top U.S. wealth shares on the basis of that portion of capital income reported on individual income tax returns—interest, dividends, rent and capital gains.

This won't work because federal tax laws in 1981, 1986, 1997 and 2003 momentously changed (1) the rules about which sorts of capital income have to be reported, (2) the tax incentives to report business income on individual rather than corporate tax forms, and (3) the tax incentives for high-income taxpayers to respond to lower tax rates on capital gains and dividends by realizing more capital gains and holding more dividend-paying stocks. ...

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July 12, 2014 in Book Club, Tax | Permalink | Comments (16)

Friday, July 11, 2014

Law Schools Peer Into The Abyss, But The ABA Blocks Serious Change

Forbes:  Law Schools Peer Into The Abyss But The American Bar Association Blocks Serious Change, by George Leef (Director of Research, John W. Pope Center for Higher Education Policy):

GatheringNot so long ago, law school was a growth industry, with new schools being created and enrollments going ever higher. No more. There has been a dramatic turn-around over the last ten years.

Enrollments of first-year students are back where they were 40 years ago. According to the Law School Admissions Council, in 2004, more than 100,000 students applied for law school, but in 2013, just 59,000 did. Some law schools have had to lay off faculty members and administrators. Four independent law schools have recently had their bonds downgraded to “junk” status by Moody’s and Standard & Poor’s, reflecting their questionable finances. ...

Law schools are not free to make many other changes that would do a lot more good, both for law students and for the clients they will eventually serve. That is because the accreditation standards imposed by the ABA require schools to operate in costly and inefficient ways.

Arguably the most vociferous critic of the ABA’s law school mandates is Larry Velvel, dean of the Massachusetts School of Law. In the short but impassioned book he wrote with Kurt Olson, The Gathering Peasants’ Revolt in American Legal Education, he made the case that law schools could train future lawyers at much lower cost if only the ABA would allow that.

Velvel and Olson write that the ABA’s policies are “designed to ensure continued and increasing economic and professional benefits for professors and deans.”

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July 11, 2014 in Book Club, Legal Education | Permalink | Comments (7)

Wednesday, July 2, 2014

NY Times: The Self-Promotion Backlash

New York Times:  The Self-Promotion Backlash, by Anna North:

InvisiblesFrom “building your personal brand” to “stepping up your social media presence,” we’re constantly inundated with advice about how to promote ourselves. But some are saying that the pressure to self-promote could, ultimately, be hurting us.

In his recent book Invisibles: The Power of Anonymous Work in an Age of Relentless Self-Promotion, David Zweig profiles a group of people whose jobs are behind the scenes in some way (a guitar technician and a United Nations interpreter, for instance), and who derive satisfaction not from public recognition, but from the internal sense of a job well done. These “Invisibles,” as he calls them, are often extremely fulfilled in their careers, and they may have something to teach those of us who feel we have to constantly promote ourselves to succeed. He writes:

“We’ve been taught that the squeaky wheel gets the grease, that to not just get ahead, but to matter, to exist even, we must make ourselves seen and heard. But what if this is a vast myth?” ...

The Invisibles offer “an alternate path to success” — they got where they were not by courting attention, but by working quietly and extremely carefully toward something bigger than themselves. “The work they do is always in service of a larger endeavor,” he explained. And they show that at least for some people, “when you focus on excellence and good work, that actually does get recognized in the end.”

July 2, 2014 in Book Club, Legal Education, Tax | Permalink | Comments (2)

Monday, June 16, 2014

Reviews of Ajay Mehrotra's Law, Politics, and the Rise of Progressive Taxation

Saturday, June 14, 2014

The Good Lawyer: Seeking Quality in the Practice of Law

Good LawyerDouglas Linder (UMKC) & Nancy Levit (UMKC), The Good Lawyer: Seeking Quality in the Practice of Law (Oxford University Press, 2014), reviewed by David Lat (Above the Law), Over a Third of All Law-School Graduates Can't Find Work Requiring Bar Passage. It's Worth Asking: What Does a Good Lawyer Look Like?, Wall Street Journal:

What does it mean to be a good lawyer? One is tempted to respond by quoting Justice Potter Stewart's famous quip about pornography: "I know it when I see it." But that wouldn't be terribly
illuminating, particularly during a period of such turmoil and transformation for the legal profession, with lawyers chasing after scarce jobs and firms fighting for limited clients. As Douglas Linder and Nancy Levit note in their new book, over a third of all law-school graduates cannot find work requiring bar passage, and median starting salaries for lawyers fell by 15% from 2009 to 2012.

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June 14, 2014 in Book Club, Legal Education | Permalink | Comments (1)

Thursday, June 5, 2014

Lempert Reviews Tamanaha's Failing Law Schools

FailingRichard O. Lempert (Michigan), Book Review, 43 Contemp. Sociology 269 (2014) (reviewing Brian Tamanaha (Washington U.), Failing Law Schools (University of Chicago Press, 2012)):

This review of Brian Tamanaha's Failing Law Schools argues that the book has considerable strengths and is a must read for anyone interested in contemporary legal education, but also has serious shortcomings and suggests reforms of questionable desirability. The burden of the review's argument is (1) Tamanaha's analysis is insufficiently sociological. Confounding cost-related problems facing law schools and peculiar to them with problems confronting higher education generally and hence unlikely to be correctable by law schools acting on their own. (2) It similarly ignores the degree to which changes in the law and the legal profession have placed new and costly demands on legal education. (3) Tamanaha's suggestion that legal education be reduced to 2 years to cut costs puts the cost horse before the educational cart and has little to commend it.

Other reviews of Failing Law Schools:

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June 5, 2014 in Book Club, Legal Education | Permalink | Comments (2)

Wednesday, June 4, 2014

Cheating: An Insider's Report on the Use of Race in Admissions at UCLA

CheatingTim Groseclose (UCLA, Department of Political Science), Cheating: An Insider's Report on the Use of Race in Admissions at UCLA (2014):

Because of California's Proposition 209, public universities such as UCLA cannot use race as a factor in admissions. However, as this book shows, UCLA gives significant preferences to African Americans, while it discriminates against Asians. The author, a professor of political science and economics at UCLA, documents what he witnessed as a member of UCLA's faculty oversight committee for admissions.

He also describes findings from a UCLA internal report as well as statistics from a large data set that he has posted online. All show that UCLA is breaking the law. The discrimination is not simply a byproduct of class-based preferences. For instance, for one aspect of the admissions process, a rich African American's chance of admission is almost double that of a poor Asian, even when the two applicants have identical grades, SAT scores, and other factors.

June 4, 2014 in Book Club, Legal Education | Permalink | Comments (17)

Tuesday, June 3, 2014

Pete Rose: A Tax Dilemma

RoseKostya Kennedy, Pete Rose: An American Dilemma 123 n.5 (2014):

Rose liked giving things to coaches, including, in 1978, Jeeps to nine Reds coaches and trainers, a gift with a value of more than $50,000 that he wrote off on his tax return, saying they were for “services rendered.” When the deduction was denied, Rose sued the IRS, claiming that the coaches were necessary to his success. He testified in court that given his approach to the game, he in particular required coaches and trainers to work long and off hours (early morning treatments, off-day batting practice etc.) He won the case mainly because the jury, as Rose’s lawyer Robert Pitcairn put it, regarded Rose as a “unique athlete.” Rose was delighted that the deduction was restored and made a point of saying publicly that he felt coaches and trainers were too often undervalued and underpaid.

(Hat Tip: Erik Jensen.)

June 3, 2014 in Book Club, Celebrity Tax Lore, Tax | Permalink | Comments (1)

Saturday, May 31, 2014

Thomas Piketty Responds to Financial Times Criticism: 'If Anything, My Book Underestimates the Rise in Wealth Inequality'

CapitalFollowing up on my previous posts on the new book by Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

Thomas Piketty (Paris School of Economics), Response to FT:

This is a response to the criticisms -- which I interpret as requests for additional information -- that were published in the Financial Times on May 23 2014. ...

I welcome all criticisms and I am very happy that this book contributes to stimulate a global debate about these important issues. My problem with the FT criticisms is twofold. First, I did not find the FT criticism particularly constructive. The FT suggests that I made mistakes and errors in my computations, which is simply wrong, as I show below. The corrections proposed by the FT to my series (and with which I disagree) are for the most part relatively minor, and do not affect the long run evolutions and my overall analysis, contrarily to what the FT suggests. Next, the FT corrections that are somewhat more important are based upon methodological choices that are quite debatable (to say the least). In particular, the FT simply chooses to ignore the Saez-Zucman 2014 study, which indicates a higher rise in top wealth shares in the United States during recent decades than what I report in my book (if anything, my book underestimates the rise in wealth inequality). Regarding Britain, the FT seems to put a lot of trust in self-reported wealth survey data that notoriously underestimates wealth inequality.

May 31, 2014 in Book Club, Tax | Permalink | Comments (2)

Saturday, May 24, 2014

Financial Times: Data Errors Undermine Piketty's Increasing Inequality Claims

CapitalFollowing up on my previous posts on the new book by Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

Financial Times, Piketty Findings Undercut by Errors:

Thomas Piketty’s book, Capital in the Twenty-First Century, has been the publishing sensation of the year. Its thesis of rising inequality tapped into the zeitgeist and electrified the post-financial crisis public policy debate. 

But, according to a Financial Times investigation, the rock-star French economist appears to have got his sums wrong.

The data underpinning Professor Piketty’s 577-page tome, which has dominated best-seller lists in recent weeks, contain a series of errors that skew his findings. The FT found mistakes and unexplained entries in his spreadsheets, similar to those which last year undermined the work on public debt and growth of Carmen Reinhart and Kenneth Rogoff.

The central theme of Prof Piketty’s work is that wealth inequalities are heading back up to levels last seen before the first world war. The investigation undercuts this claim, indicating there is little evidence in Prof Piketty’s original sources to bear out the thesis that an increasing share of total wealth is held by the richest few.

Prof Piketty, 43, provides detailed sourcing for his estimates of wealth inequality in Europe and the US over the past 200 years. In his spreadsheets, however, there are transcription errors from the original sources and incorrect formulas. It also appears that some of the data are cherry-picked or constructed without an original source.

For example, once the FT cleaned up and simplified the data, the European numbers do not show any tendency towards rising wealth inequality after 1970. An independent specialist in measuring inequality shared the FT’s concerns.

Financial Times, Piketty Response to FT Data Concerns:

Let me first say that the reason why I put all excel files on line, including all the detailed excel formulas about data constructions and adjustments, is precisely because I want to promote an open and transparent debate about these important and sensitive measurement issues (if there was anything to hide, any “fat finger problem”, why would I put everything on line?).

Let me also say that I certainly agree that available data sources on wealth are much less systematic than for income. In fact, one of the main reasons why I am in favor of wealth taxation and automatic exchange of bank information is that this would be a way to develop more financial transparency and more reliable sources of information on wealth dynamics (even if the tax was charged at very low rates, which you might agree with).

For the time being, we have to do with what we have, that is, a very diverse and heterogeneous set of data sources on wealth: historical inheritance declarations and estate tax statistics, scarce property and wealth tax data, and household surveys with self-reported data on wealth (with typically a lot of under-reporting at the top). As I make clear in the book, in the on-line appendix, and in the many technical papers I have published on this topic, one needs to make a number of adjustments to the raw data sources so as to make them more homogenous over time and across countries. I have tried in the context of this book to make the most justified choices and arbitrages about data sources and adjustments. I have no doubt that my historical data series can be improved and will be improved in the future (this is why I put everything on line).

Pejman Yousefzadeh, Facts Are Stubborn Things . . . As Thomas Piketty Is Beginning to Find Out:

The charges are devastating, and there is plenty to back them up. And again, let’s be abundantly clear: The Financial Times is accusing Thomas Piketty of dishonesty, of making up his arguments, of actively trying to mislead readers and actively trying to mischaracterize inequality trends. This mischaracterization leads to policy prescriptions on Piketty’s part that are both entirely unrealistic in their design and implementation, and, more importantly, are wholly unsupported by the actual data on inequality. The main thrust of Thomas Piketty’s book is entirely undermined, and his arguments and conclusions are annihilated. It is hard to imagine a more comprehensive refutation.

Having established that Piketty’s conclusions are shredded and unbelievable, it is important now to note two things. The first is that the Financial Times–and Chris Giles and Ferdinando Giugliano in particular–deserve kudos for the scholarship and for shining a light on Piketty’s mistakes and dishonesty. For those who are wondering how journalism ought to be done, look no further than the example set down by Giles, Giugliano and the Financial Times in general. They have truly done excellent work. Would that more media outlets followed the example that Giles, Giugliano and the Financial Times have set.

The second thing we ought to note is that neither Giles, nor Giugliano, nor the Financial Times would have discovered that Piketty’s books is fundamentally flawed if they listened to Paul Krugman, who famously said on his blog that “if you think you’ve found an obvious hole, empirical or logical, in Piketty, you’re very probably wrong. He’s done his homework!” Yes, that was a real statement by Paul Krugman, and yes, it ought to haunt him for the rest of his life–and beyond. We now know that it is more accurate to say that Piketty fudged his homework.

New York Times, A New Critique of Piketty Has Its Own Shortcomings, by Justin Wolters:

I drew the following five conclusions from The Financial Times’s re-analysis:

  1. Not all differences are errors
  2. They essentially agree
  3. Not all differences are equally important
  4. The F.T.'s bottom line is muddier than it looks
  5. This is a debate about wealth inequality, not income inequality.

Of course, one can’t help but be reminded of the kerfuffle about an earlier research paper written by Carmen Reinhart and Ken Rogoff. I fear the similarities are deeper than most realize, with partisans already engaged in gaining political mileage out of sloganeering about fairly inconsequential spreadsheet errors, rather than digging more deeply into what the data actually say. The difference is that this time the political football is an empirical result that is an article of faith among liberals, rather than conservatives. Beyond that, though, it’s different mudslingers, but similar mud.

The Financial Times analysis is definitely provocative. While it raises important questions, I’m not convinced it does more than that. Mr. Piketty has already written a fairly general response to The F.T.'s analysis, but he has yet to respond to the specific charges made. One hopes that in time Mr. Piketty will write a longer and more detailed point-by-point reply, admitting errors where they exist, and defending his data choices where they are defensible.

And perhaps some good will come from all this. The clearest effect of Mr. Piketty’s efforts is that he has brought new attention to the distribution of wealth. I believe that interest will continue to improve and refine our understanding of the evolution of wealth inequality.

New York Times, Is Piketty All Wrong?, by Paul Krugman:

[I]s it possible that Piketty’s whole thesis of rising wealth inequality is wrong? Giles argues that it is:

The exact level of European inequality in the last fifty years is impossible to determine, as it depends on the sources one uses. However, whichever level one picks, the lines in red in the graph show that – unlike what Prof. Piketty claims – wealth concentration among the richest people has been pretty stable for 50 years in both Europe and the US.

There is no obvious upward trend. The conclusions of Capital in the 21st century do not appear to be backed by the book’s own sources.

OK, that can’t be right — and the fact that Giles reaches that conclusion is a strong indicator that he himself is doing something wrong. ...

The point is that Giles is proving too much; if his attempted reworking of Piketty leads to the conclusion that nothing has happened to wealth inequality, what that really shows is that he’s doing something wrong.

None of this absolves Piketty from the need to respond to each of the individual questions. But anyone imagining that the whole notion of rising wealth inequality has been refuted is almost surely going to be disappointed.

May 24, 2014 in Book Club, Tax | Permalink | Comments (3)

Thursday, May 22, 2014

Rostain & Regan: Lawyers, Accountants, and the Tax Shelter Crisis

ConfidenceTanina Rostain (Georgetown) & Milton C. Regan Jr. (Georgetown), Confidence Games: Lawyers, Accountants, and the Tax Shelter Crisis (MIT Press, 2014):

For ten boom-powered years at the turn of the twenty-first century, some of America’s most prominent law and accounting firms created and marketed products that enabled the very rich—including newly minted dot-com millionaires—to avoid paying their fair share of taxes by claiming benefits not recognized by law. These abusive domestic tax shelters bore such exotic names as BOSS, BLIPS, and COBRA and were developed by such prestigious firms as KPMG and Ernst & Young. They brought in hundreds of millions of dollars in fees from clients and bilked the U.S. Treasury of billions in revenues before the IRS and Justice Department stepped in with civil penalties and criminal prosecutions. In Confidence Games, Tanina Rostain and Milton Regan describe the rise and fall of the tax shelter industry during this period, offering a riveting account of the most serious episode of professional misconduct in the history of the American bar.

Rostain and Regan describe a beleaguered IRS preoccupied by attacks from antitax and antigovernment politicians; heightened competition for professional services; the relaxation of tax practitioner norms against aggressive advice; and the creation of complex financial instruments that made abusive shelters harder to detect. By 2004, the tax shelter boom was over, leaving failed firms, disgraced professionals, and prison sentences in its wake. Rostain and Regan’s cautionary tale remains highly relevant today, as lawyers and accountants continue to face intense competitive pressure and regulators still struggle to keep pace with accelerating financial risk and innovation.

May 22, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, May 20, 2014

The Continuing Debate Over Thomas Piketty's Capital in the 21st Century

CapitalFollowing up on my previous posts on the new book by Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

Wall Street Journal op-ed:  Piketty's Numbers Don't Add Up, by Martin Feldstein (Harvard):

Thomas Piketty has recently attracted widespread attention for his claim that capitalism will now lead inexorably to an increasing inequality of income and wealth unless there are radical changes in taxation. Although his book ... has been praised by those who advocate income redistribution, his thesis rests on a false theory of how wealth evolves in a market economy, a flawed interpretation of U.S. income-tax data, and a misunderstanding of the current nature of household wealth.

New York Times:  To Lift the Poor, You Can’t Avoid Taxing the Rich, by Jared Bernstein (Center on Budget and Policy Priorities):

[T]here are three reliable ways to help or “lift” the bottom: subsidies that increase the poor’s economic security today; investment in their future productivity; and targeted job opportunities at decent wages. ... All of the above — the expanded earned-income tax credit, universal preschool, job-creating infrastructure — will take more tax revenue, and much of that new revenue will need to come from those at the top of the wealth scale.

New York Times:  To Lift Up the Poor, Must We Soak the Rich?, by Ross Douthat:

For a three-idea argument, I suppose it’s appropriate to raise three objections. So here they are:

  1. I don’t think even Bernstein believes that it’s actually impossible to improve the situation of the poor without directly raising taxes on the rich.
  2. It’s possible to favor increasing redistribution along something like the lines Bernstein suggests — through an expanded earned income tax credit, for instance — while disagreeing that we need a higher top marginal rate or a Piketty-style wealth tax in order to do it.
  3. Before we talk about significantly expanding our investments in education, elementary and collegiate, how confident should we feel that our existing “investment” in the “future productivity” of the poorest Americans is reaping value-for-the-dollar rewards?

Foreign Affairs:  The Inequality Illusion: Why a Wealth Tax Won't Work, by Wojciech Kopczuk (Columbia) & Allison Schrager (Quartz):

[S]everal prominent economists are proposing an annual wealth tax, which would apply only to those with assets worth more than a set amount. But there’s limited evidence that wealth inequality has actually worsened in the United States in the last 30 years. And, even if it does eventually get worse, imposing a tax on wealth is a terrible way to promote equality. It actually benefits the super wealthy the most.

Democracy -- A Journal of Ideas:  The Inequality Puzzle, by Lawrence H. Summers (Harvard):

I have serious reservations about Piketty’s theorizing as a guide to understanding the evolution of American inequality. And, as even Piketty himself recognizes, his policy recommendations are unworldly—which could stand in the way of more feasible steps that could make a material difference for the middle class. ...

Piketty argues for an internationally enforced progressive wealth tax, where the rate of tax rises with the level of wealth. This idea has many problems, starting with the fact that it is unimaginable that it will be implemented any time soon. Even with political will, there are many problems of enforcement. How does one value a closely held business? Even if a closely held business could be accurately valued, will its owners be able to generate the liquidity necessary to pay the tax? Won’t each jurisdiction have a tendency to undervalue assets within it as a way of attracting investment? Will a wealth tax encourage unseemly consumption by the wealthy?

Bloomberg:  Taxing a Professor's Privilege, by Megan McArdle:

You’ll have to wait on my thoughts on the book until they’re a bit more fully formed. As I've been reading, though, I keep returning to a question I heard at an economics conference a couple of months back: If we did implement a wealth tax, should it tax tenure? ...

Why single out professors? you ask. Isn’t this just more academic-bashing? You’re quite right: We shouldn’t single out professors. Everyone with civil-service protections or similar employment guarantees should probably have that asset taxed.

(Hat Tip: Mike Talbert.)

May 20, 2014 in Book Club, Tax | Permalink | Comments (2)

Thursday, May 15, 2014

Abusing Donor Intent: The Robertson Family's Epic Lawsuit Against Princeton University

Philanthropy News Digest, Abusing Donor Intent: The Robertson Family's Epic Lawsuit Against Princeton University:

AbusingIt's no surprise that wealthy donors and foundations seek out organizations and institutions that share their own passions and interests. But what do donors really expect from a nonprofit grantee in the long run? In the performance-measured, accountability-driven world of twenty-first century philanthropy, grantee reporting is de rigueur. For most nonprofits chasing after scarce dollars (and hoping for future gifts), the willingness and ability to demonstrate that they've aligned themselves with a donor's intent goes without saying. But what happens when a donor, after many years of happy engagement with an organization or institution, begins to believe that the original intent of the gift is no longer being honored? Our intuition tells us that, at some level, gifts/grants/donations involve a leap of faith, and that when the trust between donor and recipient is compromised, the recipient is unlikely to receive additional future gifts from that donor. A donor or foundation might even go public with its disappointment in order to discourage others from making gifts to the recipient. But rarely does a foundation or donor who has become disenchanted with a recipient ask for their money back. Which raises the question: Should they be able to? And does a statute of limitations ever apply in such a situation?

Those are two of the questions Doug White, a well-known expert in the fields of philanthropy and nonprofit management, tackles in Abusing Donor Intent: The Robertson Family's Epic Lawsuit Against Princeton University. Just as White earlier explored a rogues' gallery of swindlers and incompetent trustees in Charity on Trial, here he invites the reader to look behind the curtain of privilege and wealth, this time to learn just how bad things can get when a donor and beneficiary no longer see eye-to-eye. Informed by the slow burn of a decades-old frustration, not to mention the disposition of hundreds of millions of dollars and the reputation of one of America's oldest and most respected universities, Abusing Donor Intent is equal parts thriller and cautionary tale.

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May 15, 2014 in Book Club, Legal Education, Tax | Permalink | Comments (0)

Wednesday, May 14, 2014

Should I Go to Grad School?

Inside Higher Ed, 'Should I Go to Grad School?':

ShouldYes. Probably not. It depends. If you’re looking for a definitive answer to the question “Should I go to grad school?” a new book by that name might not be for you. And if you’re considering going to grad school to eventually get rich, the book definitely isn’t for you (it says as much in the introduction).

But if you are considering or ever have considered (for yourself or an advisee) attending graduate school – especially in the humanities – as a kind of a calling, then Should I Go to Grad School? 41 Answers to an Impossible Question is worth a read.

The book of essays on the eponymous conundrum, out this week from Bloomsbury, is likely to attract some criticism, given its lack of focus on the high-stakes financial issues surrounding the choice to pursue an advanced degree in the humanities (including the always controversial master of fine arts). But it also offers a deep, textured take on the spiritual question of attending graduate school – one that has taken a back seat, of late, to more practical (and arguably more important) discussions about student debt and the poor academic job market.

May 14, 2014 in Book Club, Legal Education | Permalink | Comments (0)

Monday, May 12, 2014

Sullivan Reviews Shaviro's Fixing U.S. International Taxation

FixingMartin A. Sullivan (Tax Analysts) Book Review, 74 Tax Notes Int'l 492 (May 12, 2014) (reviewing Daniel N. Shaviro (NYU), Fixing U.S. International Taxation (Oxford University Press, 2014)):

When it comes to international taxation, House Ways and Means Committee Chair Dave Camp, R-Mich., and professor Daniel N. Shaviro of New York University Law School have a lot in common. In the age-old debate between the two poles of worldwide and territorial taxation, they want compromise. They want to achieve a balance between promoting competitiveness and preventing excessive profit shifting to tax havens.

A pro-business conservative, Camp would have preferred his plan to lean more in the direction of multinational competitiveness. But in his three-year quest for tax reform, the chair has learned by doing, and what he has learned from the revenue estimators at the Joint Committee on Taxation is that moving to an exemption system is too expensive without tough measures to discourage profit shifting. Shaviro's path to compromise is based on his own reasoning after extensive review of the legal and economic scholarship on international tax.

The main way Camp and Shaviro seek to achieve a balanced approach is by setting the average effective rate on foreign-source income of U.S. multinationals somewhere below the statutory corporate rate and somewhere above zero. Although this conclusion would hardly be startling to a newcomer to the study of international tax -- and is the practical result under current law for many taxpayers because of deferral -- the traditional debate on international tax does not easily lend itself to compromise. ...

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May 12, 2014 in Book Club, Scholarship, Tax, Tax Analysts | Permalink | Comments (0)

Wednesday, May 7, 2014

Zelenak: Tearing Out the Income Tax by the (Grass)Roots

Lawrence Zelenak (Duke), Tearing Out the Income Tax by the (Grass)Roots, 15 Fla. Tax Rev. 649 (2014) (reviewing Isaac William Martin (UC-San Diego, Department of Sociology), Rich People’s Movements: Grassroots Campaigns to Untax the One Percent (Oxford University Press, 2013)):

RPMWhy do rich people seeking reductions in their tax burdens, who have the ability to influence Congress directly through lobbying and campaign contributions, sometimes resort to grassroots populist methods? And why do non-rich people sometimes join the rich in their anti-tax movements? These are the puzzles Isaac William Martin sets out to solve in Rich People’s Movements. ...

The next section of this review summarizes Martin’s original and compelling work in uncovering the history of a century of rich people’s antitax movements. That is followed by sections on three shortcomings of the book—an inadequate explanation of why non-rich persons have joined in the movements, Martin’s odd decision to exclude from the book’s coverage two of the most important anti-tax movements of recent decades (the flat tax and the FairTax), and the scant attention paid by the book to the often-fascinating rhetoric of the anti-tax movements. Although I consider these criticisms to be considerably more than quibbles, they do not alter my view that Rich People’s Movements is a major contribution to the scholarly literature on the history of taxation in twentieth-century America. It shines a light on a series of related movements—many of which had been nearly forgotten even by tax history scholars—which are fascinating in their own right and which have continued significance today as the predecessors of the Tea Party and other grassroots anti-tax movements of the twenty-first century.

May 7, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, May 6, 2014

Lessons for University Leaders on the Professional Lives of Women Faculty of Color

Maria Pabon Lopez (Loyola (New Orleans) & Kevin R. Johnson (Dean, UC-Davis), Presumed Incompetent: Important Lessons for University Leaders on the Professional Lives of Women Faculty of Color:

PresumedAcademics have long known that the experiences of women faculty members of color differ in important respects from those of any other faculty members. Adding significantly to that body of knowledge, Presumed Incompetent: The Intersections of Race and Class for Women in Academia [(Utah State University Press, 2012)] edited by Professors Angela P. Harris and Carmen Gonzalez in a collection of essays of different voices offers important lessons for scholars, university administrators and leaders, faculty members, and, for that matter, students interested in the experiences of women of color in academia. People of good faith who want to “do the right thing” may find it difficult to read the unsettling stories and pleas for empathy, internalize the lessons as based on common occurrences rather than outlier experiences, and consider how to address and redress the issues. Still, we as a collective have the obligation and responsibility to think about what might be done to improve the day-to-day lives of the next generation of women faculty of color.

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May 6, 2014 in Book Club, Legal Education, Scholarship | Permalink | Comments (3)

Tuesday, April 29, 2014

Bridge to Practice Series™

Sponsored by West Academic

Michael Vitiello  (McGeorge):

BridgeFinding bad news about legal education is easy. And some of the bad news is deeply troubling. No one in legal education can be insensitive to the slowly recovering employment market and to concerns about student debt. But some of the gloom and doom about law schools is just wrong.

In 2011, David Segal wrote a series of articles that appeared on the front page of the New York Times. His articles did not say anything new about legal education. But the appearance of his views on the front page of the Times made Segal’s voice important.

Some of Segal’s criticisms are legitimate. But one aspect of his critique was galling. In one article, after observing that young lawyers have spent over $150,000 for their legal educations, Segal commented, “What that they did not get, for all that time and money, was much practical training.” Segal also contended that the law school curriculum has changed little since the days of Dean Langdell. Segal’s portrayal of legal education was stereotypical and one dimensional.

When I graduated from law school 40 years ago, the statement about limited practical training was true. Even then, law schools were putting in place legal clinics and volunteer programs to give students on-hands experience. To continue to insist that little has changed in the past three decades demonstrates a lack of awareness of what goes on in law schools around the country.

Start with changes in skills based courses like legal writing and moot court. Within the past 25 years, many schools have converted their programs from one or two unit pass-fail courses often taught by upper level students to far more demanding programs. Most schools hire tenure track or long term contract professionals. Many law schools offer rigorous writing programs and train students in oral advocacy skills. That has been the pattern at McGeorge. The directors of our Global Lawyering program have created a nationally recognized writing program. The program spans the first two years and offers students with a wide range of practical skills. For example, during their 2 L year, students argue multiple motions in a “district court” after they have submitted memoranda to the court. Their earlier memoranda culminate in a full appellate brief, submitted and argued individually to an appellate court. Each student argues before a three judge panel. The realistic litigation problem introduces students to international law as well. For example, students may have to argue whether domestic or foreign law applies because the problem presents a conflict of law question.

Skills education goes well beyond clinics, legal writing, trial advocacy, and externship programs. Many professors have integrated skills training into more traditional courses. I offer my own example as someone who came into the academy after three years of experience, mostly as a judicial clerk. Many years ago, I realized the necessity of integrating simulation exercises into my Civil Procedure course. Concepts like personal jurisdiction and summary judgment challenge the best students; students have trouble grasping concepts that lack any intuitive feel. For many years, I pieced together simulation exercises; but I did not provide systematic exposure.

That all changed when my acquisitions editor at West Academic Publishing accepted my proposal to publish a series of simulation books. The books in the Bridge to Practice Series™ are designed to supplement traditional casebooks across the curriculum. Priced reasonably, the paperbacks run between 100 and 200 pages. Each contains a series of simulations with a teacher’s manual detailing how the professor can integrate the simulations into their “podium” courses.

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April 29, 2014 in Book Club, Legal Education | Permalink | Comments (0)

Monday, April 28, 2014

Shaviro, Sullivan Speak on Tax Reform at NYU Today

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Book Discussison (12:30 - 1:50 p.m.):  Daniel Shaviro (NYU), Fixing U.S. International Taxation (Oxford University Press, 2014):

FixingInternational tax rules, which determine how countries tax cross-border investment, are increasingly important with the rise of globalization, but the modern U.S. rules, even more than those in most other countries, are widely recognized as dysfunctional. The existing debate over how to reform the U.S. tax rules is stuck in a sterile dialectic, in which ostensibly the only permissible choices are worldwide or residence-based taxation of U.S. companies with the allowance of foreign tax credits, versus outright exemption of the companies’ foreign source income. In Fixing U.S. International Taxation, Daniel N. Shaviro explains why neither of these solutions addresses the fundamental problem at hand, and he proposes a new reformulation of the existing framework from first principles. He shows that existing international tax policy frameworks are misguided insofar as they treat “double taxation” and “double non-taxation” as the key issues, conflate the distinct questions of what tax rate to impose on foreign source income and how to treat foreign taxes, and use simplistic single-bullet global welfare norms in lieu of a comprehensive analysis. Drawing on tools that are familiar from public economics and trade policy, but that have been under-utilized in the international tax realm, Shaviro offers a better analysis that not only reshapes our understanding of the underlying issues, but might point the way to substantially improving the prevailing rules, both in the U.S. and around the world.”

  • Daniel Shaviro (NYU)
  • Itai Grinberg (Georegtown)
  • Martin Sullivan (Tax Analysts)

Public Lecture (6:00 - 7:30 p.m.):  Martin Sullivan (Tax Analysts), Tax Reform 2017: Incremental or Fundamental?:

Sullivan (2014)Martin Sullivan is the chief economist of Tax Analysts (publisher of Tax Notes) and is a leading expert on federal tax reform. He is a contributing editor for Tax Analysts’ daily and weekly publications. Sullivan has written over 500 economic analyses for Tax Analysts and is the author of two books on tax reform, including the recent Corporate Tax Reform: Taxing Profits in the 21st Century. He is also a regular contributor to Tax Analysts’ blog and Forbes.com. He has testified before Congress on numerous occasions. Previously, Sullivan taught economics at Rutgers University and served as a staff economist at the U.S. Department of the Treasury and later at the congressional Joint Committee on Taxation. Sullivan graduated magna cum laude from Harvard College and received a PhD in economics from Northwestern University. 

April 28, 2014 in Book Club, Colloquia, Scholarship, Tax | Permalink | Comments (0)

Saturday, April 26, 2014

The Debate Over Thomas Piketty's Capital in the 21st Century

CapitalFollowing up on my previous post on the new book by  Thomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

David Brooks (New York Times), The Piketty Phenomenon:

Piketty ... argues that the real driver of inequality is not primarily differences in human capital. It’s differences in financial capital. Inequality is not driven by young hip professionals who arm their kids with every advantage and get them into competitive colleges; it’s driven by hedge fund oligarchs. Well, of course, this book is going to set off a fervor that some have likened to Beatlemania.

The book is very good and interesting, but it has pretty obvious weaknesses. Though economists are really not good at predicting the future, Piketty makes a series of educated guesses about the next century. ...

Politically, the global wealth tax is utopian, as even Piketty understands. If the left takes it up, they are marching onto a bridge to nowhere. But, in the current mania, it is being embraced.

This is a moment when progressives have found their worldview and their agenda. This move opens up a huge opportunity for the rest of us in the center and on the right. First, acknowledge that the concentration of wealth is a concern with a beefed up inheritance tax. Second, emphasize a contrasting agenda that will reward growth, saving and investment, not punish these things, the way Piketty would. Support progressive consumption taxes not a tax on capital. Third, emphasize that the historically proven way to reduce inequality is lifting people from the bottom with human capital reform, not pushing down the top. In short, counter angry progressivism with unifying uplift.

Paul Krugman (Princeton), Why We’re in a New Gilded Age (New York Review of Books):

The big idea of Capital in the Twenty-First Century is that we haven’t just gone back to nineteenth-century levels of income inequality, we’re also on a path back to “patrimonial capitalism,” in which the commanding heights of the economy are controlled not by talented individuals but by family dynasties.

It’s a remarkable claim—and precisely because it’s so remarkable, it needs to be examined carefully and critically. Before I get into that, however, let me say right away that Piketty has written a truly superb book. It’s a work that melds grand historical sweep—when was the last time you heard an economist invoke Jane Austen and Balzac?—with painstaking data analysis. And even though Piketty mocks the economics profession for its “childish passion for mathematics,” underlying his discussion is a tour de force of economic modeling, an approach that integrates the analysis of economic growth with that of the distribution of income and wealth. This is a book that will change both the way we think about society and the way we do economics. ...

Piketty ends Capital in the Twenty-First Century with a call to arms—a call, in particular, for wealth taxes, global if possible, to restrain the growing power of inherited wealth. It’s easy to be cynical about the prospects for anything of the kind. But surely Piketty’s masterly diagnosis of where we are and where we’re heading makes such a thing considerably more likely. So Capital in the Twenty-First Century is an extremely important book on all fronts. Piketty has transformed our economic discourse; we’ll never talk about wealth and inequality the same way we used to.

Paul Krugman (Princeton), The Piketty Panic (New York Times):

The really striking thing about the debate so far is that the right seems unable to mount any kind of substantive counterattack to Mr. Piketty’s thesis. Instead, the response has been all about name-calling — in particular, claims that Mr. Piketty is a Marxist, and so is anyone who considers inequality of income and wealth an important issue. ...

[W]hat’s really new about “Capital” is the way it demolishes that most cherished of conservative myths, the insistence that we’re living in a meritocracy in which great wealth is earned and deserved. ... [T]he fact that apologists for America’s oligarchs are evidently at a loss for coherent arguments doesn’t mean that they are on the run politically. Money still talks — indeed, thanks in part to the Roberts court, it talks louder than ever. Still, ideas matter too, shaping both how we talk about society and, eventually, what we do. And the Piketty panic shows that the right has run out of ideas.

Greg Mankiw (Harvard), First Thoughts on Piketty:

The book has three main elements:

  1. A history of inequality and wealth.
  2. A forecast of how things will evolve over the next century
  3. Policy recommendations, such as a global tax on wealth.

Point 1 is a significant contribution. I like this part of the book a lot.

Point 2 is highly conjectural. Economists are really bad at such things. In particular, the leap from r>g to the conclusion of a growing role of inheritance in society seems too large to me. Many capital owners consume much of the return on their capital, so wealth does not grow at rate r. This consumption ranges from fancy cars and luxurious vacations to generous charitable giving. In addition, unless mating is perfectly assortative, or we return to an era of primogeniture, wealth per family shrinks as it is split among children.  So, from my perspective, Pikettty tries to draw way too much from r>g. ...

Point 3 is as much about Piketty’s personal political philosophy as it is about his economics. As we all know, you can’t get “ought” from “is.” Like President Obama and others on the left, Piketty wants to spread the wealth around. Another philosophical viewpoint is that it is the government’s job to enforce rules such as contracts and property rights and promote opportunity rather than to achieve a particular distribution of economic outcomes. No amount of economic history will tell you that John Rawls (and Thomas Piketty) offers a better political philosophy than Robert Nozick (and Milton Friedman).

The bottom line: You can appreciate his economic history without buying into his forecast.  And even if you are convinced by his forecast, you don't have to buy into his normative conclusions.

April 26, 2014 in Book Club, Tax | Permalink | Comments (0)

Monday, April 14, 2014

The Political Economy of Policy Transitions

OxfordMichael J. Trebilcock (Toronto), Dealing with Losers: The Political Economy of Policy Transitions (Oxford University Press 2014):

Whenever governments change policies—tax, expenditure, or regulatory policies, among others—there will typically be losers: people or groups who relied upon and invested in physical, financial, or human capital predicated on, or even deliberately induced by the pre-reform set of policies. The issue of whether and when to mitigate the costs associated with policy changes, either through explicit government compensation, grandfathering, phased or postponed implementation, is ubiquitous across the policy landscape. Much of the existing literature covers government takings, yet compensation for expropriation comprises merely a tiny part of the universe of such strategies.

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April 14, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Monday, March 31, 2014

Piketty: Capital in the Twenty-First Century

CapitalThomas Piketty (Paris School of Economics), Capital in the Twenty-First Century (Harvard University Press, 2014):

What are the grand dynamics that drive the accumulation and distribution of capital? Questions about the long-term evolution of inequality, the concentration of wealth, and the prospects for economic growth lie at the heart of political economy. But satisfactory answers have been hard to find for lack of adequate data and clear guiding theories. In Capital in the Twenty-First Century, Thomas Piketty analyzes a unique collection of data from twenty countries, ranging as far back as the eighteenth century, to uncover key economic and social patterns. His findings will transform debate and set the agenda for the next generation of thought about wealth and inequality.

Piketty shows that modern economic growth and the diffusion of knowledge have allowed us to avoid inequalities on the apocalyptic scale predicted by Karl Marx. But we have not modified the deep structures of capital and inequality as much as we thought in the optimistic decades following World War II. The main driver of inequality—the tendency of returns on capital to exceed the rate of economic growth—today threatens to generate extreme inequalities that stir discontent and undermine democratic values. But economic trends are not acts of God. Political action has curbed dangerous inequalities in the past, Piketty says, and may do so again.

A work of extraordinary ambition, originality, and rigor, Capital in the Twenty-First Century reorients our understanding of economic history and confronts us with sobering lessons for today.

The New Yorker, Piketty’s Inequality Story in Six Charts:

In this week’s magazine, I’ve got a lengthy piece about “Capital in the Twenty-first Century,” a new book about rising inequality by Thomas Piketty, a French economist, that is sparking a lot of comment and debate. (Brad DeLong has a useful summary of some early reviews.) I’ll go further into that discussion in future posts, but first I thought it might be useful to portray the gist of Piketty’s story in a series of charts.

  Chart 1

Chart 2

New York Times:  Q&A: Thomas Piketty on the Wealth Divide, by Eduardo Porter:

Income inequality moved with astonishing speed from the boring backwaters of economic studies to “the defining challenge of our time.” It found Thomas Piketty waiting for it.

A young professor at the Paris School of Economics, he is one of a handful of economists who have devoted their careers to understanding the dynamics driving the concentration of income and wealth into the hands of the few. He has distilled his findings into a new book, “Capital in the Twenty-First Century,” which is being published this week. In the book, Mr. Piketty provides a sort of unified theory of capitalism that explains its lopsided distribution of rewards.

Financial Times op-ed:  Save Capitalism From the Capitalists by Taxing Wealth, by Thomas Piketty

March 31, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Henderson Reviews The Lawyer Bubble and Tomorrow's Lawyers

BCWilliam D. Henderson (Indiana), Letting Go of Old Ideas, 112 Mich. L. Rev. ___ (2014) (reviewing Steven Harper, The Lawyer Bubble  (Basic Books 2013) and Richard Susskind, Tomorrow’s Lawyers (Oxford University Press 2013)):

Two recently published books apply a rigorous analytical lens to the same topic — the state of the legal profession — and come to dramatically different conclusions. Yet, what is more remarkable is the fact that the authors’ analyses neither overlap nor conflict with one another. One is backward-looking and filled with regret at the legacy we have squandered (Steven Harper’s The Lawyer Bubble); the other is forward-looking and bound to inspire a mix of fear and hope among its readers (Richard Susskind’s Tomorrow’s Lawyers).

Similarly, there’s been a lot of public handwringing in recent years over the state of the legal industry, with some arguing that we are in crisis and others countering that the real problem is overzealous critics. Those looking for a common narrative to unify and lead law practitioners and students must grapple with these two important books. In this review, I suggest that arriving at such an understanding requires each of us to do something uncomfortable and unnatural — let go of old ideas.

Bill blogs about his review on The Legal Whiteboard.

March 31, 2014 in Book Club, Legal Education, Scholarship | Permalink | Comments (0)

Saturday, March 29, 2014

Legal Education's Moment of Impact: How to Design Strategic Conversations That Accelerate Change

MomentsChris Ertel (Deloitte Consulting) & Lisa Kay Solomon (Innovation Studio), Moments of Impact: How to Design Strategic Conversations That Accelerate Change (Simon & Schuster, 2014), reviewed by Adrian Wooldridge (Management Editor, The Economist) in the Wall Street Journal, The Best 'Strategy Meetings' Unleash Fresh Thinking and Offer Maverick Views; The Worst Are Dull, Unstructured Time-Sucks:

Anybody who has anything to do with the corporate world will be only too familiar with "strategy meetings" in which senior managers try to lift their heads above the parapets and gaze over the competitive landscape. The organizers try do everything they can to shake people out of their "default settings." They hold the meetings off-site. They tell everyone to forget about corporate hierarchies and routine agendas. They bring in outside experts to talk about industry trends. They experiment with corporate games.

And the result of all this effort? More often than not a huge waste of time. Few management techniques have produced more toe-curling embarrassment than what the authors of "Moments of Impact" call "strategic conversations." Brain-storming sessions produce airy-fairy nonsense. Attempts to abandon hierarchy generate status hierarchy. The outside experts are nothing more than cliché-mongers. As for the corporate games, the less said the better.

And yet the need for wide-ranging discussions of strategy has never been greater. Many companies confront radical challenges that cannot be dealt with by business as usual....

Mr. Ertel and Ms. Solomon make several points that ought to be obvious but are clearly not, given the number of strategic conversations that go wrong. The first is that you need to define the purpose of your meeting. Are you trying to get a broad overview of industry trends? Or are you trying to make specific decisions? The second is that unstructured meetings are as dangerous as over-structured ones. Companies that are used to having tight agendas often throw agendas out of the window when they hold off-site meetings. But unstructured "brainstorming" sessions seldom produce any light.

"Moments of Impact" is at its best on the importance of promoting different perspectives. Businesses need to look at the world through as many disciplinary lenses as possible if they are to cope with the fast-changing threats that confront them. But day-to-day corporate life is all about fences and silos. Strategic conversations give companies a chance to examine their business models from the outside—and, as the authors put it, to "imagine operating within several different yet plausible environments."

(Click on YouTube button on bottom right to view video directly on YouTube to avoid interruption caused by blog's refresh rate.)

March 29, 2014 in Book Club, Legal Education | Permalink | Comments (0)

Sunday, March 16, 2014

Church Marketing Campaigns for Their Pastor's Books and Private Inurement

Pajama Pages, On Driscoll, It’s Called Inurement, and It’s Probably Illegal:

Real MarriageMark Driscoll may have imperiled his church’s nonprofit status and, with it, cost his congregation millions of dollars in tax deductions. I am neither a lawyer nor an accountant, but I can read IRS publications that describe the kind of hot water that Mars Hill Church and other churches can get into when they use donated money to buy their pastors’ books.

You can read the 50-page IRS description of inurement here, but I’ll try and summarize it for you here and explain why this applies to Driscoll’s NYT campaign and perhaps many other churches that use church resources to benefit their pastors’ publishing careers.

Churches and other charities are granted non-profit status so long as they use the money they raise exclusively for religious, educational or charitable purposes. Although they can pay staff and officers for work they perform to advance their stated purposes for the public, they cannot take special measures to direct the resources of the organization to any private individual or corporate entity, especially an individual that is an insider of the charity. Such activity is considered inurement, but before considering it in more detail, it’s worth reviewing what we know of the Mars Hill/Driscoll arrangement.

Mars Hill spent approximately $220,000 that had been donated to it to purchase services and books to have Driscoll’s book [Real Marriage: The Truth About Sex, Friendship & Life Together] appear on the New York Times best seller list. ... Mars Hill reports that it received $25m in tithes and offerings last year. Assuming an average deduction value of a contribution to be 25 percent, as the Congressional Research Service does, Mars Hill members saved $6.25m in tax payments because of the church’s exempt status. So, a $220,000 investment has the potential to cost church members $6,250,000.

Patheos, Do We Need a Code of Ethics for Mega-Pastors Who Write?:

Recently World Magazine had a piece on Unreal Sales for Mark Driscoll’s Real Marriage to the effect that the Mars Hill Church bought Driscoll’s book a place on the NYT best seller list through a marketing company with a deliberate intent to by-pass the NYT’s own safe guards against authors or publishers artificially inflating the sales figures for their book. This might even violate IRS rules and regulations about non-for-profits committing inurement. CT also has a piece on this where they link to Mars Hill Church’s official response to the issue.

March 16, 2014 in Book Club, Celebrity Tax Lore, Tax | Permalink | Comments (2)

Tuesday, March 11, 2014

Brooks Reviews Global Economic Governance and the Politics of International Tax Cooperation

CoverKimberley Brooks (Dean, Dalhousie University, Schulich School of Law), After the Financial Crisis (reviewing Richard Eccleston (University of Tasmania), The Dynamics of Global Economic Governance: The Financial Crisis, the OECD and the Politics of International Tax Cooperation (2012)):

[The book] is a welcome addition to the literature on the regulatory responses to international tax evasion, authored in the light of the global financial crisis.  Richard Eccleston, a political scientist in Tasmania, shifts the typical legal scholar’s lens from the legal frameworks that facilitate tax evasion to a careful and insightful exploration or the role of political actors in facilitating tax cooperation in response to that evasion.  The work is supported by interviews with more than 40 national tax officials, business and NGO representatives, OECD and UN staff.

Global Economic Governance is written for tax junkies.  It is shot through with detail, carefully crafted, and densely written.  For those with a mild interest in the area, the chapter to spend time on is the first one, and most specifically the section that details the strategies used in international tax evasion: private banking, mass-marketed tax schemes, opaque corporate structures, shell entities, trusts, rules that obscure real ownership, methods of disguising real corporate ownership, and exempt entities.  This reads like the stuff of a good (or perhaps average) Tom Cruise movie: nevertheless, it is daily fare for those who seek to avoid tax liability around the world.

March 11, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Sunday, March 9, 2014

Advice for Parents and Their Daughters

Interesting juxtaposition in the Weekend Wall Street Journal book review section:

BossyThe Saturday Essay:  Don't Call Us Bossy:

Confident girls are often called the other B-word, and it can keep them from reaching their full potential, write Sheryl Sandberg and Anna Maria Chávez.

Although the two of us come from different backgrounds, we both heard the same put-down. Call it the other B-word. Whether it is said directly or implied, girls get the message: Don't be bossy. Don't raise your hand too much. Keep your voice down. Don't lead.

Even our most successful and celebrated female leaders cannot rise above these insults. A foreign-policy adviser once described former British Prime Minister Margaret Thatcher as "the bossy intrusive Englishwoman." Susan Rice, the U.S. national security adviser, was described as having a "bossy demeanor" by a fellow diplomat, while Supreme Court Justice Sonia Sotomayor has been described as "difficult" and "nasty" by lawyers.

The phrase "too ambitious" is leveled at female leaders from Madeleine Albright to Hillary Clinton and perpetuates our most damning stereotypes. Retired Supreme Court Justice Sandra Day O'Connor has a pillow in her California home that declares: "I'm not bossy. I just have better ideas."...

Despite earning the majority of college degrees, women make up just 19% of the U.S. Congress, 5% of Fortune 500 CEOs and 10% of heads of state. Most leadership positions are held by men, so society continues to expect leadership to look and act male and to react negatively when women lead.

The irony, of course, is that so-called bossy women make great leaders. And we need great leaders. Our economic growth depends upon having women fully engaged in the workforce. Our companies perform better with more women in management. And our homes are happier when men and women share responsibilities more equally.

It's time to end the gendered speech that discourages girls from an early age. So the next time you hear a girl called "bossy," do what CBS anchor Norah O'Donnell advised: Smile, take a deep breath and say, "That girl's not bossy. She has executive leadership skills."

Marry SmartCharlotte Allen, Battle Hymm of a Tiger Mother (reviewing Susan Patton, Marry Smart: Advice for Finding THE ONE (2014)):

If mating today is a game of winner-take-all, should women treat college as a time for husband hunting?

Susan Patton is the infamous "Princeton Mom." A graduate of Princeton (class of '77), with two Princeton sons, Ms. Patton wrote a letter last year to the campus newspaper advising female Tigers: "Find a husband on campus before you graduate." Her point was that never again would these high-achieving and highly ambitious young women have access to so large a pool of single young men who were their intellectual equals. After college, as these educated young women entered the workplace, they would discover that the most desirable men are usually already married. As the letter went viral online, feminists jumped all over Ms. Patton, accusing her of perpetuating archaic gender roles, meddling in her sons' romantic lives and chewing on sour grapes because her own marriage, to a non-Princeton man long after graduation, had ended in divorce after 25 years.

The current expectation for most women attending college, especially a top-ranked college, is to spend their 20s building their careers, experimenting with relationships, and not even thinking about wanting a husband and children until they reach age 30 or so. In "Marry Smart," essentially a book-length expansion of her Daily Princetonian letter, Ms. Patton forthrightly explains why this trajectory is all wrong. "Let's face it: By the time you are thirty years old, your marriage prospects will have diminished dramatically from what they were when you were twenty," she writes. "And when you're thirty and still hope to have children, a distinct panic will start to set in." 

For one thing, there is the matter of looks. "You'll never be more attractive than you are as a very young woman," Ms. Patton writes. This is true. If you want to see beautiful people, visit any college campus. Even the plain girls and the slovenly girls in their sweatpants and rubber shower sandals radiate vitality. They all may still look fine a decade later, but if mating is a game of winner-take-all—and Ms. Patton is quite sure it is—the question is whether men in their own age cohort will prefer their now-older selves to the younger competition.

Since men, even young college men, distinguish between the women they want to have casual sex with and the women they want to marry and have children with, Ms. Patton devotes much of her book to telling readers how to fall into the second category. Avoid the campus hookup scene—it's a waste of precious time. Don't binge-drink—you will do stupid things. Realistically assess your looks and act accordingly: If you are only a "six," that handsome "ten" knows he can do better than you and is probably out of your league. Lose excess weight. Act like a lady. Don't swear like a fishwife. Learn to cook. Don't be a whiny, moody, spoiled, entitled princess ("hothouse tomato" is Ms. Patton's term). Cultivate a generous spirit and a readiness to forgive. Don't chase after "bad boys," especially if they display traits such as drug abuse and physical violence. Don't be a gold-digger ("earn your own fortune").

For some young women, "Marry Smart" will be like a trip to the carwash, where the dust of antagonistic feminist doctrine about sex and marriage gets blasted off the windshield so they can see clearly. Ms. Patton's advice mirrors sociologist Peter Berger's observation that "the lightning shaft of Cupid seems to be guided rather strongly within very definite channels of class, income, education, racial and religious background." Although Ms. Patton's tone can seem snobbish and Ivy-centric, what she has to say is meant to apply equally to young women whose best educational prospects turn out to be a state school, a community college or perhaps no college at all: Start looking for a lifelong mate seriously and early on; don't waste time with jerks, criminals and, unless you are exceptionally beautiful, men outside your social class; and cultivate the moral qualities that will make you attractive to a man of moral quality.

March 9, 2014 in Book Club, Legal Education, Tax | Permalink | Comments (4)

Tuesday, March 4, 2014

Go Ahead, Let Your Kids Fail

Following up on my prior post, Why Failing Well Is the Key to Success:  Bloomberg, Go Ahead, Let Your Kids Fail, by Megan McArdle:

UpI’m on the road this week, giving talks on my new book [The Up Side of Down: Why Failing Well Is the Key to Success (2014)] about learning to fail better: that is, first, to give ourselves the permission to take on challenges where we might very well fail; second, to pick ourselves up as quickly as possible and move on when things don’t work out. This is, I argue, vital on a personal level, as well as vital for the economy, because that’s where innovation and growth come from.

The other day, after one of my talks, a 10th-grade girl came up and shyly asked if I had a minute. I always have a minute to talk to shy high school sophomores, having been one myself.

And this is what she asked me:

“I understand what you’re saying about trying new things, and hard things, but I’m in an International Baccalaureate program and only about five percent of us will get 4.0, so how can I try a subject where I might not get an A?”

I was floored. All I could think as I talked to this poor girl is “America, you’re doing it wrong.”

I was 15 in 10th grade. If you can’t try something new in 10th grade, when can you? If you can’t afford to risk anything less than perfection at the age of 15, then for heaven’s sake, when is going to be the right time? When you’re ready to splash out on an edgy assisted-living facility?

Now is when this kid should be learning to dream big dreams and dare greatly. Now is when she should be making mistakes and figuring out how to recover from them. Instead, we’re telling one of our best and brightest to focus all her talent on coloring within the lines. This is not the first time I’ve heard this from kids and teachers and parents. But I’ve never heard it phrased quite so starkly. ...

Do we want a society that dreams new things and then makes them happen? I hear that we do, every time I hear a teacher, or a politician, give a speech. So why are we trying so hard to teach the next generation to do the exact opposite?

March 4, 2014 in Book Club, Legal Education, Tax | Permalink | Comments (2)

Disinherit the IRS

Disinherit the IRS:

DisinheritDisinherit the IRS is a well-written, easy-to-read and comprehensive estate planning and wealth protection guide that was originally published in 2001. It evolved in response to requests from fellow Americans who feared the fruits of their life's work was under assault by a growing litigious society and tax hungry government. This updated 2014 edition will help you understand current estate tax laws and how they impact the most popular estate planning tools, including trusts and life insurance. You will also gain insight into lawful wealth protection strategies used by real families as well as vital information on how to leave your assets to heirs and favorite causes and not the IRS. Family wealth protection expert and author of Disinherit the IRS, E. Michael Kilbourn recruited estate planning attorney Brad A. Galbraith for the 2014 edition as an extra guarantee that every chapter reflects the most sound advice based on today's laws. In this book, you will discover how to: remove assets from your taxable estate without losing control of them or the income they generate, make a profit by donating to charity, effectively exempt your entire estate from state taxes, avoid capital gains taxes on the sale of your appreciated property and eliminate state taxes on your assets at your death. In essence, you will learn how to leave what you have to whom you want, when you want and in the way you want while minimizing possible court costs, attorney fees and estate taxes.

March 4, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Friday, February 28, 2014

Ring Reviews Resolving Transfer Pricing Disputes: A Global Analysis

Book 2Diane M. Ring (Boston College), Book Review, 73 Tax Notes Int'l 713 (Feb. 17, 2014) (reviewing Resolving Transfer Pricing Disputes: A Global Analysis (Eduardo Baistrocchi & Ian Roxan eds., Cambridge University Press 2013)):

Eduardo Baistrocchi and Ian Roxan have brought a new contribution, Resolving Transfer Pricing Disputes, to the global literature on transfer pricing. The basic structure is straightforward: The introduction provides an overview of the book's mission, coverage, and design process. Chapter 2 outlines the transfer pricing problem, its history, and the evolving international response. The following 18 chapters highlight countries around the globe, both those with a long history of transfer pricing regulation and countries just beginning to develop and implement a national response. The concluding chapters return to themes identified at the outset regarding the evolution of the transfer pricing regime -- the claim that the international tax system has been moving from a rules-based response to a more standards-based approach to the problem of artificial income shifting.

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February 28, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Wednesday, February 26, 2014

Shaviro Presents Fixing U.S. International Taxation Today at Duke

FixingDaniel N. Shaviro (NYU) presents Fixing U.S. International Taxation (Oxford University Press, 2014) at Duke today as part of its Tax Policy Seminar hosted by Lawrence Zelenak:

Part 1, consisting of chapters 2 and 3, first reviews the basic U.S. international tax rules, and then addresses in greater detail the design challenges that they raise, along with their main incentive effects and planning implications. Part 1 could be skimmed or even skipped by readers who either are already well-versed in the operational details, or else do not wish to delve too deeply into the U.S. international tax system’s plumbing. However, it does (chapter 3 in particular) develop some points that are important to the subsequent analysis. Part 2 then shifts to a broader policy focus. To this end, chapter 4 addresses the global welfare perspective on U.S. international tax policy. Chapter 5 addresses the unilateral national welfare perspective. Finally, chapter 6 addresses the question of what practical steps might be taken to improve U.S. international tax policy.

February 26, 2014 in Book Club, Colloquia, Scholarship, Tax | Permalink | Comments (0)

In Defense of Disciplines: Rejecting the Siren Song of Interdisciplinary Research

Inside Higher Ed:  A Call to Embrace Silos:

In DefenseEveryone, it seems, wants to promote interdisciplinary work. College and university presidents love to announce new interdisciplinary centers. Funders want to support such work. Many professors and graduate students bemoan the way higher ed places them in silos from which they long to free themselves, if only they could get tenure for interdisciplinary work.

Jerry A. Jacobs, a professor of sociology at the University of Pennsylvania, wants to end the interdisciplinary love fest. His new book, In Defense of Disciplines: Interdisciplinarity and Specialization in the Research University (University of Chicago Press, 2013), challenges the conventional wisdom that academe needs to get out of disciplines to solve the most important problems and to encourage creative thinking. The most significant ideas (including those related to problems that cross disciplines) in fact come out of specialized, discipline-oriented work, Jacobs argues. Further, he says that the idea that disciplines don't communicate right now is overstated -- and that such communication can be encouraged without weakening disciplines.

In an interview, he said common sense shows that interdisciplinary problems require many disciplines to work on them -- from the strength of their scholarly backgrounds.

February 26, 2014 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (0)

Thursday, February 20, 2014

Call for Book Reviews: Michigan Law Review

Michigan The Michigan Law Review has asked me to post its solicitation of book reviews for its 2015 Survey of Books Related to the Law:

The Michigan Law Review publishes an Annual Survey of Books dedicated to book reviews. Book reviews are not included in any other issue of the Michigan Law Review. The Survey includes reviews of books published in the current year and the past three years. The Volume 113 Book Review issue will be published in spring 2015.

Proposal guidelines can be downloaded here. Manuscripts and draft sections to accompany the proposal are appreciated. Please note that all Book Review proposals, drafts, and manuscripts must be submitted via email to michlrev.ed.br@umich.edu. Decisions regarding the upcoming issue will generally be made between March and May of 2014.

Please note that we prefer that finished drafts be no more than 8,500 words, including footnotes.

To request an expedited decision or to contact the Book Review Editors, please e-mail michlrev.ed.br@umich.edu.

February 20, 2014 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (0)

Thursday, February 13, 2014

More Reviews of Tamanaha's Failing Law Schools

FailingTwo reviews of Brian Tamanaha (Washington U.), Failing Law Schools (University of Chicago Press, 2012)):

David Burk (Ph.D. Candidate, University of Chicago Department of Economic), Book Review, 63 J. Legal Educ. 349 (2013):

Failing Law Schools is not the right title for Professor Brian Tamanaha’s book. A better one might be, The Sad Fate of Poor Performers at Low-Ranked Law Schools. It is not as catchy, but gives a better idea of what the book is about. Better still would be to excise the sections about how law school is a bad deal, and call the remaining portion Why Law School is So Expensive and What to Do About It, because the book does a fine job of answering those questions

Michael Simkovic (Seton Hall Law School) & Frank McIntyre (Rutgers Business School), Populist Outrage, Reckless Empirics: A Review of Failing Law Schools, 108 Nw. U. L. Rev. Online 176 (2014):

The authors of The Economic Value of a Law Degree ... focus[] on problems with empirical claims in Failing Law Schools regarding outcomes for law graduates and also regarding law faculty compensation. The review also discusses Professor Tamanaha's proposals for reform of legal education in light of economic theory and the empirical economics literature, and finds reasons to doubt that Tamanaha's proposed reforms will have the effects he predicts.

Other reviews of Failing Law Schools:

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February 13, 2014 in Book Club, Legal Education, Scholarship | Permalink | Comments (11)

Wednesday, February 12, 2014

Schmidt: How Tax Law Made Modern America

AjayChristopher W. Schmidt (Chicago-Kent), How Tax Law Made Modern America (Jotwell), reviewing Ajay K. Mehrotra (Indiana), Making the Modern American Fiscal State: Law, Politics, and the Rise of Progressive Taxation, 1877-1929 (Cambridge University Press, 2013):

This book serves as a model for legal historians who are looking to integrate fine-grained, nuanced analyses of historical events and actors with the kind of big-picture ideas that most readily engage our fellow legal scholars. This is a book that illuminates a fundamental transformation of the American state, a transformation in whose shadow we obviously live today. This is also a book that takes ideas quite seriously. (Mehrotra begins one of his chapters with John Maynard Keynes’s quotation about “[p]ractical men” unknowingly being “the slaves of some defunct economist.”) But this book is not, in the end, a work of intellectual history or political theory. It is history in which ideas are important because they moved the machinery of politics and law. Understanding the roots of the policy changes examined in this book requires careful attention to the larger ideas that made the policy seem so urgent and necessary. We are thus witnesses to the complex interplay of ideology, legal development, politics, and social activism. Out of all this, as this book so effectively and smartly demonstrates, arose a new set of legal norms, political expectations, and societal sensibilities.

One of the most important contributions of Making the Modern American Fiscal State is the way in which Mehrotra conceptualizes the very idea of taxes. Taxing, in Mehrotra’s account, was not just a tool for raising revenues to fund whatever policy the government in power favored. It was not just a neutral means to a contested, ideological end. Taxing policy was itself a statement of substantive ideology; it was a discourse through which Americans could talk about their vision of government and civic responsibility. “Fiscal citizenship” is the nicely evocative label Mehrotra attaches to this idea. This is a rich, compelling, and convincing framework through which to think about taxing. And it is a perfect vehicle for telling the story of the rise of progressive taxation and thus the formation of the modern American state.

February 12, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (1)

Tuesday, February 11, 2014

Why Failing Well Is the Key to Success

Megan McArdle, The Up Side of Down: Why Failing Well Is the Key to Success (2014):

UpMost new products fail. So do most small businesses. And most of us, if we are honest, have experienced a major setback in our personal or professional lives. So what determines who will bounce back and follow up with a home run? If you want to succeed in business and in life, Megan McArdle argues in this hugely thought-provoking book, you have to learn how to harness the power of failure.

McArdle has been one of our most popular business bloggers for more than a decade, covering the rise and fall of some the world’s top companies and challenging us to think differently about how we live, learn, and work. Drawing on cutting-edge research in science, psychology, economics, and business, and taking insights from turnaround experts, emergency room doctors, venture capitalists, child psychologists, bankruptcy judges, and mountaineers, McArdle argues that America is unique in its willingness to let people and companies fail, but also in its determination to let them pick up after the fall. Failure is how people and businesses learn. So how do you reinvent yourself when you are down?

Dynamic and punchy, McArdle teaches us how to recognize mistakes early to channel setbacks into future success. The Up Side of Down marks the emergence of an author with her thumb on the pulse whose book just might change the way you lead your life. 

February 11, 2014 in Book Club, Legal Education, Tax | Permalink | Comments (2)

Thursday, February 6, 2014

Careers in Tax Law: Perspectives on the Tax Profession

Careers in Tax Law The ABA Tax Section has published Careers in Tax Law: Perspectives on the Tax Profession and What It Holds for You, by John Gamino, Robb A. Longman & Matthew R. Sontag:

Designed for those considering or beginning a career in tax law, this informative guide presents a series of offerings -- autobiographies in miniature -- by a broad cross section of working tax professionals. Each contribution stands as a unique story of paths taken, choices made, and lessons learned. Each adds to a composite portrait of the profession and its possibilities for the next generation of tax lawyers. In essays divided thematically into the following chapters, over 75 tax professionals share their unique perspectives, knowledge, and experiences. Nowhere else will you find such an honest and entertaining portrayal of the tax profession and what it holds for you.

See the Forward and Table of Contents.  Contributions from Tax Profs include:

  • Edward D. Kleinbard (USC), Private Clients, Public Good, p. 124
  • George K. Yin (Virginia), Lawyer, Teacher, Public Servant, p. 127
  • Leandra Lederman (Indiana-Bloomington), It’s Not Just Teaching, p. 133
  • Alice G. Abreu (Temple), The Best Job in the World, p. 136
  • Mona L. Hymel (Arizona), The Impossible Dream?, p. 140
  • Francine J. Lipman (Chapman), The Gift That Keeps on Giving, p. 143

February 6, 2014 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (0)

Slemrod & Gillitzer: Tax Systems

Tax SystemsJoel Slemrod (Michigan) & Christian Gillitzer (Ph.D. 2013, Michigan), Tax Systems (MIT Press, 2014):

Despite its theoretical elegance, the standard optimal tax model has significant limitations. In this book, Joel Slemrod and Christian Gillitzer argue that tax analysis must move beyond the emphasis on optimal tax rates and bases to consider such aspects of taxation as administration, compliance, and remittance. 

Slemrod and Gillitzer explore what they term a tax-systems approach, which takes tax evasion seriously; revisits the issue of remittance, or who writes the check to cover tax liability (employer or employee, retailer or consumer); incorporates administrative and compliance costs; recognizes a range of behavioral responses to tax rates; considers nonstandard instruments, including tax base breadth and enforcement effort; and acknowledges that tighter enforcement is sometimes a more socially desirable way to raise revenue than an increase in statutory tax rates. Policy makers, Slemrod and Gillitzer argue, would be well advised to recognize the interrelationship of tax rates, bases, enforcement, and administration, and acknowledge that tax policy is really tax-systems policy.

Avoidance, evasion, compliance, and administration are 50 percent of the real action but only 5 percent of academic research on taxation. Joel Slemrod has been dominant in rectifying this imbalance. Tax Systems consolidates his and others’ work and leads the way forward.
—Louis Kaplow, Finn M. W. Caspersen and Household International Professor of Law and Economics, Harvard Law School

Research on tax design often overlooks essential issues of policy implementation. Tax Systems addresses this important oversight, providing insightful analysis on topics including compliance, complexity, remittance, and the design of information reports. Researchers and policy-makers will find this volume a compelling demonstration of how economic analysis can inform the key questions of tax administration.
—James Poterba, Mitsui Professor of Economics, MIT, and President, National Bureau of Economic Research

February 6, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, January 14, 2014

Bartlett: Eisner v. Macomber: How the Courts Constrain Tax Reform

New York Times:  How the Courts Constrain Tax Reform, by Bruce Bartlett:

Tax StoriesThe taxation of capital gains has always been among the most politically contentious elements of the tax code and will be among the most difficult to resolve when fundamental tax reform is undertaken. But it is made even more difficult by an old Supreme Court case limiting the scope of potential reform. ...

[I]n the 1921 case of Merchants Loan and Trust Co. v. Smietanka, the Supreme Court definitively ruled that capital gains were taxable under the income tax. That left the issue one for Congress to deal with henceforth.

However, one lasting judicial constraint on congressional latitude is the principle that only realized capital gains may be taxed, a legacy of the Eisner decision. [Marjorie E. Kornhauser (Tulane), The Story of Eisner v. Macomber: The Continuing Role of “Realization” in Tax Law and Policy, in Tax Stories (Paul L. Caron, ed.) (Foundation Press 2d ed. 2009).] This is important because many economists believe that a proper income tax ought to tax all capital gains annually, whether realized or not. It also creates a problem with unrealized gains at death and whether they should be taxed as if realized. ...

In short, there aren’t only political and economic barriers to implementing tax reform, but constitutional ones left over from long-ago court cases. Some theorists believe that only by adopting a pure consumption tax, and eliminating the taxation of incomes entirely, can we fully escape the problems inherent in capital gains taxation.

(Hat Tip: Mike Talbert.)

January 14, 2014 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Thursday, January 9, 2014

Making Partner: The Essential Guide to Negotiating the Law School Path and Beyond

Making PartnerAdam Gropper (Legislation Counsel, Joint Committee on Taxation), Making Partner: The Essential Guide to Negotiating the Law School Path and Beyond (ABA Press, 2013):

Competition is tough and jobs are limited. Use Making Partner to learn strategies and tactics for achieving your career goals.

Making Partner provides practical information and specific advice about how to obtain a position at a top law firm of any size, including AmLaw 100 firms, and how to excel once you are there. The advice is given in the form of a step-by-step explanation of a highly effective and proven method used to secure a top law firm job, and detailed best practices to follow to be a star associate on the fast track to partnership and a successful junior partner.

This book is recommended for medium and large law firm associates at all levels, as well as for students.

Adam blogs at LegalJob.com.

January 9, 2014 in Book Club, Legal Education, Scholarship, Tax | Permalink | Comments (0)

Tuesday, December 31, 2013

Faculty Pretend to Teach, Students Pretend to Learn

5 YearWall Street Journal op-ed:  We Pretend to Teach, They Pretend to Learn: At Colleges Today, All Parties Are Strongly Incentivized to Maintain Low Standards, by Geoffrey L. Collier (South Carolina State University):

The parlous state of American higher education has been widely noted, but the view from the trenches is far more troubling than can be characterized by measured prose. With most students on winter break and colleges largely shut down, the lull presents an opportunity for damage assessment.

The flood of books detailing the problems includes the representative titles Bad Students, Not Bad Schools and The Five Year Party. To list only the principal faults: Students arrive woefully academically unprepared; students study little, party much and lack any semblance of internalized discipline; pride in work is supplanted by expediency; and the whole enterprise is treated as a system to be gamed in which plagiarism and cheating abound.

The problems stem from two attitudes. Social preoccupations trump the academic part of residential education, which occupies precious little of students' time or emotions. Second, students' view of education is strictly instrumental and credentialist. They regard the entire enterprise as a series of hoops they must jump through to obtain their 120 credits, which they blindly view as an automatic licensure for adulthood and a good job, an increasingly problematic belief.

BadEducation thus has degenerated into a game of "trap the rat," whereby the student and instructor view each other as adversaries. Winning or losing is determined by how much the students can be forced to study. This will never be a formula for excellence, which requires intense focus, discipline and diligence that are utterly lacking among our distracted, indifferent students. Such diligence requires emotional engagement. Engagement could be with the material, the professors, or even a competitive goal, but the idea that students can obtain a serious education even with their disengaged, credentialist attitudes is a delusion.

The professoriate plays along because teachers know they have a good racket going. They would rather be refining their research or their backhand than attending to tedious undergraduates. The result is an implicit mutually assured nondestruction pact in which the students and faculty ignore each other to the best of their abilities. This disengagement guarantees poor outcomes, as well as the eventual replacement of the professoriate by technology. When professors don't even know your name, they become remote figures of ridicule and tedium and are viewed as part of a system to be played rather than a useful resource.

(Hat Tip: Greg McNeal.)

December 31, 2013 in Book Club, Legal Education | Permalink | Comments (5)

Tuesday, December 24, 2013

How A Christmas Carol Shaped My World

Christmas CarolBarry Sullivan (Loyola-Chicago), A Book that Shaped Your World: Charles Dickens, A Christmas Carol, 50 Alberta L. Rev. 934 (2013):

To celebrate the Alberta Law Review's fiftieth volume, the book review editors invited friends and alumni to put aside for a moment their required reading, and reflect briefly on the books that have shaped their approaches to life and the law. Professor Sullivan chose to reflect upon the perennially popular A Christmas Carol, to thoughtful and poetic effect.

The Victorians still have much to say to us. After all, apart from Shakespeare and the Greeks, who has written so insightfully as Trollope about the moral complexity and ambiguities of political life, with its competing claims of conscience and compromise, altruism and self-interest, idealism and corruption? But Dickens also merits our patronage. Dickens is the great moralist. His brief sounds in equity; his interest is fairness. Sentimental and didactic, he does not speak to our intellects in the way that Trollope does. Dickens shamelessly plays on our emotions. He speaks to our hearts. He manipulates us. He points us to the deepest truths about what it means to be human. And nowhere does he do that more effectively or with greater economy than in A Christmas Carol. ... The "power" that Scrooge attributes to Fezziwig is one that belongs to all of us. It is the power to act for good, and lawyers have that power in abundance.

December 24, 2013 in Book Club, Legal Education, Tax | Permalink | Comments (4)

Tuesday, December 10, 2013

Sheppard Reviews Tamanaha's Failing Law Schools

FailingSteve Sheppard (University of Arkansas School of Law), The Self-Fulfilling Prophecy of Law School Crisis (reviewing Brian Tamanaha (Washington U.), Failing Law Schools (University of Chicago Press, 2012)):

For this reviewer, Failing Law Schools is frustrating to read, but I do not think my frustration arises, as Tamanaha forecasts, because it challenges me, my salary, or my work ethic (p. 186). Indeed I have the luxury of working at one of the state law schools like those that Tamanaha sees as potential exceptions from his indictments.

Rather, the book is frustrating because of its rhetoric and use of sources. Each chapter seizes one charismatic point (or a few points), presents the point in detail but without essential context, and then draws inferences that the point cannot support....

The recent fall in law school applications may be seen by some critics as proof of the criticism. Yet it may be as likely that the fall results from the fact of the criticism. The alarm for law schools sounded by Failing Law Schools and similar declamations, predicting further decline in applications based on structural problems it identifies, may be explained by a host of factors that are far beyond the scope of the book, not the least being the general decline in law school applications among college graduates since the end of the Vietnam War. Yet there is more reason to believe that the continuing downturn in applications, extending beyond the drop that would be expected from the jobs recovery in 2009-13, is partly attributable to the criticism itself. Certainly, the scamblog movement described in Failing Law Schools has had an effect, and its encouragement by law professors, such as Tamanaha and Paul Campos at Colorado, has given the scambloggers a veneer of accuracy. This is not to say that the effect of the scambloggers has been to open the eyes of law school applicants to their realistic economic opportunities four years in the future. Rather the effect on the perception of college graduates and other would-be applicants is more likely to be cultural than to be one of economic awareness.

The effects on law schools, however, will be both economic and cultural. One might hope that the cultural effects will be constructive engagement, a continued improvement in legal education, that encourages knowledge, skill, professional ethics, and a rich understanding of the role of law and its function in a democracy. Understanding the need to fund legal services, not just legal education, would be a part of that engagement. It would be a great shame if the result were merely to dumb down law school. The price for that effect would be borne not just by the law students but also by their clients, and ultimately by the country.

Other reviews of Failing Law Schools:

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December 10, 2013 in Book Club, Legal Education, Scholarship | Permalink | Comments (2)

David Foster Wallace, Tax, and Arguing Persuasively

Pale KingABA Journal, David Foster Wallace’s Advice on Arguing Persuasively:

David Foster Wallace, born in 1962, was one of the most respected writers of his generation. His novel Infinite Jest was considered by many one of the great English language novels of the late 20th century. ... In a lengthy interview with me in February 2006, Wallace discussed many points of interest to legal writers. It proved to be one of his last long interviews (he committed suicide in September 2008). What follows is an excerpt from a newly released book, Quack This Way: David Foster Wallace & Bryan A. Garner Talk Language and Writing (Oct. 25, 2013)). ...

Why do so many English professors write so poorly?
The simple way to put it, I think, is: Writing, like any kind of communicating, is complicated. When you’re writing a document for your professional peers, you’re sending out a whole lot of different messages. Some of them are the stuff you’re arguing; some of them are stuff about you.

My guess is that disciplines that are populated by smart, well-educated people who are good readers but are nevertheless characterized by crummy, turgid, verbose, abstruse, abstract, solecism-ridden prose are usually part of a discipline where the dynamic between writing as a vector of meaning—as a way to get information or opinion from me to you—versus writing as maybe a form of dress or speech or style or etiquette that signals that “I am a member of this group” gets thrown off.

There’s the kind of boneheaded explanation, which is that a lot of people with PhDs are stupid; and like many stupid people, they associate complexity with intelligence. And therefore they get brainwashed into making their stuff more complicated than it needs to be.

I think the smarter thing to say is that in many tight, insular communities—where membership is partly based on intelligence, proficiency and being able to speak the language of the discipline—pieces of writing become as much or more about presenting one’s own qualifications for inclusion in the group than transmission of meaning. And that’s how in disciplines like academia—or, I’ve read some really good legal prose, but when it’s really, really horrible (IRS Code stuff)—I think that very often it stems from insecurity and that people feel that unless they can mimic the particular jargon and style of their peers, they won’t be taken seriously and their ideas won’t be taken seriously. It’s a guess.

Prior TaxProf Blog coverage:

December 10, 2013 in Book Club, Scholarship, Tax | Permalink | Comments (1)

Tuesday, November 26, 2013

Shaheen: On Shaviro's Fixing U.S. International Taxation

FixingFadi Shaheen (Rutgers-Newark), On Fixing U.S. International Taxation, 8 Jerusalem Rev. Legal Stud. ___ (2013):

This paper was prepared for a book symposium at Hebrew University Law School in June 2013 on Daniel N. Shaviro’s forthcoming book, Fixing U.S. International Taxation (Oxford University Press, 2014). The paper adds a few thoughts to those discussed in the book regarding the international tax neutrality analysis and certain interrelated notions concerning deferral, foreign tax credits, foreign tax deductions, and the tax rate on foreign source income. 

November 26, 2013 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Tuesday, November 12, 2013

Sham Transactions (Oxford University Press)

ShamSham Transactions (Edwin Simpson & Miranda Stewart, eds.,  Oxford University Press 2013):

Part I: Context and History
1. Introduction: What is the Sham 'Doctrine'?, Miranda Stewart & Edwin Simpson
2. Sham: Early Uses and Related and Unrelated Doctrines, Mike McNair
3. The Judicial Doctrine of Sham in Australia, Miranda Stewart
4. Sham Transactions in the United States, Joshua Blank & Nancy Staudt
5. Sham and Purposive Statutory Construction, Edwin Simpson
Part II: Sham Transactions
6. 'Shams' in Tenancy Agreements, Susan Bright, Hannah Glover & Jeremias Prassl
7. Sham and Trusts, Matthew Conaglen
8. Sham and Trusts: A Practitioner's Perspective, Nicholas Le Poidevin
9. Sham Doctrine and Company Charges, Lord Neuberger
10. Sham Transactions in Employment Law, Anne Davies
11. Shams and Piercing the Corporate Veil, Robert Miles & Eleanor Holland
Part III: Taxation and Artificiality
12. Tracing the Boundaries of Sham and Ramsay, Malcolm Gammie
13. Sham and Tax Avoidance: What Difference does a GAAR make? - a New Zealand Perspective, Shelley Griffiths & Jessica Palmer
14. Trompe-l'oeil: Sham in the Canadian Tax Courts, Glen Loutzenhiser
15. Sham, Tax Avoidance and 'A Realistic View of Facts', John Vella
16. Sham and Tax Law: Coffee Beans, Trust Funds and Judicial Distaste, Michael Kirby

November 12, 2013 in Book Club, Scholarship, Tax | Permalink | Comments (1)

Wednesday, November 6, 2013

Sheffrin: Tax Fairness and Folk Justice

Tax FairnessSteven M. Sheffrin (Tulane), Tax Fairness and Folk Justice (Cambridge University Press, Oct. 28, 2013):

Why have Americans severely limited the estate and gift tax -- ostensibly targeted at only the very wealthy -- but greatly expanded the subsidies to low-wage workers through the Earned Income Tax Credit, now the single largest poverty program in the country? Why do people hate the property tax so much, yet seemingly revolt against it only during periods of economic change? Why are some groups of taxpayers more obedient to the tax authorities than others, even when they face the same enforcement regime? These puzzling questions all revolve around perceptions of tax fairness. Is the public simply inconsistent? A sympathetic and unified explanation for these attitudes is based on understanding the everyday psychology of fairness and how it comes to be applied in taxation. This book demonstrates how a serious consideration of "folk justice" can deepen our understanding of how tax systems actually function and how they can perhaps be reformed.

A fabulous book! Filled with insights on a crucially important, but underexplored, aspect of tax policy. This book should be required reading for anyone interested in the politics or sociology of taxation. -- David Gamage (UC-Berkeley)

Steve Sheffrin brings together insights from social psychology and philosophy to reconcile how economists think about tax fairness with how everyone else does. It is a fascinating ride, well worth taking, that draws on the author's familiarity with modern economics and with the details of tax systems. Sheffrin's argument that many key features of the tax system are best explained through understanding folk justice concepts is compelling and should be taken seriously by all students of taxation.  -- Joel Slemrod, University of Michigan

November 6, 2013 in Book Club, Scholarship, Tax | Permalink | Comments (0)

Wednesday, October 30, 2013

Shaviro Presents Fixing U.S. International Taxation at Columbia

DShaviroDaniel N. Shaviro (NYU) presents Fixing U.S. International Taxation (Oxford University Press, 2014) (purchase from amazon) at Columbia tomorrow as part of its Tax Policy Colloquium Series hosted by Alex Raskolnikov, David Schizer, and Wojciech Kopczuk:

Part 1, consisting of chapters 2 and 3, first reviews the basic U.S. international tax rules, and then addresses in greater detail the design challenges that they raise, along with their main incentive effects and planning implications. Part 1 could be skimmed or even skipped by readers who either are already well-versed in the operational details, or else do not wish to delve too deeply into the U.S. international tax system’s plumbing. However, it does (chapter 3 in particular) develop some points that are important to the subsequent analysis. Part 2 then shifts to a broader policy focus. To this end, chapter 4 addresses the global welfare perspective on U.S. international tax policy. Chapter 5 addresses the unilateral national welfare perspective. Finally, chapter 6 addresses the question of what practical steps might be taken to improve U.S. international tax policy.

Update:  Dan has more details here.

October 30, 2013 in Book Club, Colloquia, Scholarship, Tax | Permalink | Comments (0)

Tuesday, October 22, 2013

Taxing Global Digital Commerce

TaxingArthur J. Cockfield (Queen's University Faculty of Law), Walter Hellerstein (University of Georgia School of Law), Rebecca Millar (University of Sydney Faculty of Law) & Christophe Waerzeggers (IMF), Taxing Global Digital Commerce (Wolters Kluwer Law & Business (Sept. 23, 2013)):

The term e-commerce -- the use of computer networks to facilitate transactions involving the production, distribution, sale, and delivery of goods and services in the marketplace -- has grown from merely streamlining relations between consumer and business to a much more robust phenomenon embracing efficient business processes within a firm and between firms. Inevitably, the related taxation issues have grown too.

This latest edition of the preeminent text on the taxation of electronic transactions -- formerly titled Electronic Commerce and International Taxation (1999) and Electronic Commerce and Multijurisdictional Taxation (2001) -- revises, updates, and expands the book's coverage, reorganizes its presentation, and adds several new chapters. It includes a detailed and up-to-date analysis of VAT developments regarding e-commerce, and explores the implications of e-commerce for the US state and local sales and use tax regime. It discusses developments in Europe and the United States while enlarging its focus to include the tax treatment of e-commerce in China, India, Canada, Australia, and throughout the world. Analysing the practical tax consequences of e-commerce from a multijurisdictional and multitax perspective, the book offers in-depth treatment of such topics as the following:

  • how tax rules governing cross-border e-commerce are increasingly applied to all cross-border activities;
  • how tax rules and processes developed to confront challenges posed by e-commerce provoke optimal tax policy;
  • how technology enhances tax and cross-border information exchanges;
  • how technology lowers both compliance and enforcement costs;
  • consumption tax issues raised by cloud computing; and
  • different approaches to the legal design of VAT place of taxation rules, with examples.

This edition, while building on earlier editions' analysis of the relationship between traditional tax laws and the Internet, contains a more explicit and systematic consideration of e-commerce issues as well as the ongoing policy responses to them. Tax professionals and academics everywhere will welcome the giant step it takes towards the design of multijurisdictional tax regimes that are both conceptually sound and practical in implementation.

See here for Table of Contents, Preface, and Chapter 1.

October 22, 2013 in Book Club, Scholarship, Tax | Permalink | Comments (0)