I am stumped by what Yaron Brook said: the world won’t let a country have a free banking system, because it’s going to be used for money laundering. The country will be attacked and destroyed, he says, within hours.
Chatting with ChatGPT revealed that even if it won’t be attacked, it can be boycotted by all international banks. You may think: who cares, we will trade gold inside the country, or crypto. But this will make importing goods impossible. Banks will just delist it from SWIFT network.
But if New America will have to regulate banks, it will require so many adjacent regulations, in so many spheres of activity (after all, money funds all production), that it won’t be laissez-faire anymore.
Harry Binswanger: And as Yaron Brook pointed out at OCON, do you think the world would permit free banking in this new utopia? Neither do I. Yet free banking is integral to the successful functioning of capitalism.
Banking is just an example. The point is that the required moral code precludes the world from putting up with a successful individualist society.
Jim Allard writes, HBL #143188: The problem is that freedom loses its value if one has to hide out alone (or with a few researchers) on an island (or boat). The value of freedom comes from being able to interact and with a large number of people — the more the better — in a society, where there a laws, contracts, division of labor, etc.
For most of human history, men could “get lost” in the wilderness, on an island or boat, and be “free.” And yet living among other men, even if they were serfs and slaves, was often preferable.
Yes, I’m rereading it, and you hit the nail on the head. It doesn’t need to be another offshore financial centre.
This is one of the main drivers of old school libertarian country founders in the 70s, 80s, and even 90s, as they were also hell-bent on creating a sort of Cayman Islands 2.0, and I think that’s the kind of rationale that attracts the wrong kind of attention.
I remember a lot of those efforts dissipated when the OECD FATF started introducing their blacklist of countries back, I think, as early as 2000, and it was hitting countries even like Monaco real hard.
You further hit it right about what’s known as genuine connections. This is something that is often lost in the banking and financial planning world.
The big case is Nottenbohm. He was the German guy that bought a Liechtenstein passport during the war, and in spite of that, Guatemala, where he was living, treated him like a German, saying that he didn’t really have a strong connection to Liechtenstein.
Oddly enough, the International Court of Justice agreed with Guatemala and not him. That court case still stands, so running out there and buying another citizenship or passport or setting up accounts remotely might all be legal.
It’s just that without a genuine link, it can collapse like a house of cards.
So you’re right, I’m saying that if someone moves to new America and, let’s say, buys a condo there, registers a business there, starts having friends in the neighbourhood, all the normal things that entail planting roots, then yeah, there is most certainly a genuine link, and that’s a whole different ball of wax.
Yes, and they also do now offer tax residency, and they cleverly require people to spend a little bit of time in Próspera and to set up there, which is smart and does help to establish more of a genuine link.
The big thing is, though, you don’t necessarily want to get people to inorganically do things they wouldn’t do otherwise, and some cannot manufacture a genuine link either, but yes, that is very much what Próspera is trying to do, though they would claim they are much more broader and comprehensive, since there is supposedly biomedical research going on down there as well.
What prevents someone (a) to wire a Prospera bank $100,000 from his home country, (b) to declare it an expense on home country’s taxes return, (c) to cash it out in Prospera by paying for a bogus medical research project, and (d) to arrange for ten people to deposit $10,000 each into his bank account, paying each $100 “transit” fee? He will then have $99,000 in his Prospera bank account, deemed locally derived income, which is tax free in Prospera. Now he can wire back to U.S. $99,000 dollars that are tax free.
The only way the home country can prevent this, is to require Prospera to regulate all banking and production. Prospera’s government would need to verify that the $100,000 did go towards a real medical projects, and when money returned to the bank account, it was derived from legitimate buisnes activity as locally derived profit (e.g. from sales of medical treatements). The verification of the legitimacy of the expense would require a regulatory body, an “FDA,” which will have to monitor all medical research. But then, it’s back to regulation land, back to statism.
Yeah, really nothing at all. I mean, you could substitute Próspera for many different other jurisdictions.
The thing is this. Próspera, from my understanding, has not issued many banking charters or licences, and to this day Próspera entities struggle to get business bank accounts.
I mean, I know they like to use Tower Bank out of the Republic of Panama, but there are many banks that are not willing to onboard Próspera entities, and the ones that do often put them through the ringer big time.
We see the precarious situtaion Israel is in, since it made itself fully dependent on United States. But just about every U.S. president has betrayed it and the Jews. The latest betrayal, in a seqeuence of betrayals, is of course from the current US president disgraceful capitulation. That’s the cost of pragmatism, the evil of pragmatism. Under the guise of doing what’s pratical, Israel and the Amercian people have been betrayed by this “ceasefire,” while the Iranian terrorist regime has been emboldened. The best rhetoric on this in is on the New Ideal video titled “The Humiliating Iran Ceasefire Deal” (see link).
But what should we learn from this about starting a new country? That we can’t put all our eggs in one basket. Had Israel another benefactor state, it could have refused the ceasefire, and continue to bomb Iran. In fact, it could have done just that last summer.
https://www.youtube.com/watch?v=opUGimR5nr0
