The Real Reason Governments Are Killing Financial Privacy
By Nick Giambruno, Editor, International Man
Wednesday, 29 May 2013
At the latest G-20 meeting, central bankers, finance ministers, and an assortment of other central planners touted what they hoped would be a new “global standard” of the automatic sharing of financial information.
The US has taken the lead with the odious FATCA law, and the EU has followed suit with its own version. Through FATCA and other measures, both governments are aggressively seeking new ways to undermine financial privacy.
Financial privacy should not be viewed in a negative light, as it is often portrayed. The Swiss view it as a fundamental human right to preserve dignity, akin to medical privacy. How would you feel if the government snooped into your medical records and automatically shared those records with foreign governments?
While it would appear that the primary objective of this new “global standard” is to rake in more money for bankrupt governments, it seems another motive is at play here.
The optimistic estimate for FATCA is that it will bring in around $9 billion over 10 years or $900 million on average per year.
With the deficit in 2012 for the US federal government at $1.1 trillion, the expected $900 million from FATCA is not even a drop in the bucket (actually around one-tenth of one percent). Even in the unlikely event that the US will moderately reduce its deficit in the future, the revenue from FATCA will remain a pittance in comparison.
So, it begs the question: Why would the US government go through all the enormous trouble of implementing FATCA if it’s going to bring in such a meager amount of money?