A simple Data-CD is about to shake the foundations of Switzerland itself. How come?
An unknown Data thief has offered German Authorities a CD containing valuable data about some 1′500 tax frauds, for some 2,5 Mio. Euros. Germany may generate a 100 Mio. Euros on back taxes and penalties and the odd bad boy will face jail. This is an impressive return on investment and Germany, as much under pressure financially as most other industrialized nations, does not really want to not use it. Moreover, it is a hard sell to tell your welfare recipients that they have to pay back the €20, they erroneously received in January and then go on and graciously waive a hundred million. Poor people are voters, too and Angela Merkel is not a political suicide.
I personally have my doubts about the legality of the purchase, but one may well argue that a higher interest is at stake und thus the purchase is legitimate.
So this is an entirely German affair, is it not?
So why are the Swiss so very upset?
Here’s the math:
An estimated 3 Trillion Swiss Francs in Swiss bank accounts are Assets under Management owned by foreigners. 30% to 50% are at least from grey, if not black money, that is approximately 1 trillion Swiss Francs.
“Switzerland has become a paradise for foreign capital on which tax is not paid. The uproar from foreign governments is understandable.” These are not the words of a critic of the banks, but of private banker Konrad Hummler. He says that around 30%, or CHF 1,000 billion, of the CHF 2,800 billion or so of foreign assets in Swiss banks is untaxed “black money”.
I’m still being conservative. Let’s say 30% of those funds are from German individuals, that makes it 330 billion Swiss Francs.
Let’s say German investors panic, because the only argument for having your money in Switzerland is the banking secrecy (they pay a measly 1% interest here). They are going to get their own money and transfer it elsewhere, or even repatriate the stuff and grudgingly pay the back taxes to avoid a hefty fine or in some cases jail.
More math:
The Swiss GDP is about 500 bn Swiss Francs (2008), the financial sector is generating about 12% of GDP, banks about 7.5% that makes it 37.5 bn. But they may lose 330 bn. They would stop contributing to GDP for almost ten years to refill their coffers.
But banks have equity capital, have they not? Well at least UBS, the biggest player, is still in a load of trouble and struggling to get it’s equity capital quota into a reasonable percentage.
Now add to that the fact that we are talking about bank accounts owned by Germans only, what’s more, we talk about German tax dodgers’ accounts. There are other countries’ citizens involved, too. This adds another hefty sum at stake. Then there are those who have put their money into Swiss accounts legally, but don’t want to be under the general suspicion of being a tax fraud. Again: In sum there are some 3 trillion Swiss Francs at stake. If only a third of it is lost to other markets, Switzerland goes broke.
Some of the more naive here reckon banking secrecy can still be saved. The naivest of them all, the right wing SVP (Swiss People’s Party), even think they can win the next elections by harshly defending the status quo. The Swiss are not so stupid. Still sore about the UBS bailout, they are not prepared to ruin their country to protect a couple of foreign tax frauds and their banksters.
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February 8, 2010
Californians Face 39% Rate Hike for Health Insurance
HT – TPM
Anthem Blue Cross increased its health insurance premiums in the Golden State by 39%.
Now that the Republicans in the Senate have their 41st vote, guarenteeing successful filibusters on any attempt at health care reform, insurance companies are quick to make the most of their captive customers.
One couple, this author knows, will see their premiums increase by $450 per month. The only way they can afford the extra premiums is to declare bankruptcy to wipe out their other debts and lose their home of 25+ years. Since one of the pair has a chronic, debilitating condition, they are unable to purchase health insurance on the open market.
On the other hand, the upper eschelon of Wellpoint, Anthem Blue Cross’ parent company, do quite well.
I guess when you’re making nearly $10,000,000 a year, an extra $5,000 for health insurance doesn’t seem like much. But when you’re making $60,000 and your premiums are already 20% of your annual income, an extra $5,000 is crippling.
This, then, is the system that the Teabaggers were willing to seceed from the Union to protect. One can only wonder how many Teabaggers in California are going to face this latest premium hike with the glee of a child opening presents on Christmas morning.
Your thoughts are welcome.
10 Comments
Filed under Commentary, Health Care, Opinion, Opinion - Essay/Editorial
Tags: Briseadh na Faire @ TPZoo, Health Insurance, teabaggers