Pavel Durov quits as VKontakte CEO
gigaom.comThis kind of thing seems to be one reason America is still the best place to start a business.
I'm saying that in order to spark a debate and challenge that belief. Would anyone please list some actions taken by the US government which is similar in nature to the takeover illustrated here?
It seems very similar to what happened in the middle ages. Before the rise of the merchant class, specifically the ability to defend themselves, bullies stepped in and took what they wanted. Pg went into some detail about that in one of his essays about wealth. The phrase "if you let the nerds keep their lunch money, you rule the world" comes to mind. Might that be changing? Is Russia harming itself by taking these actions? What ways might this action backfire against them? Or is this a new model for how governments should treat corporations that dare challenge their authority?
EDIT: I really didn't mean to start a flamewar. My apologies. I was hoping to get people's thoughts on whether governments of the future are going to do this kind of thing more and more (including the US). I should have led with that rather than cheerleading America.
EDIT2: I would again like to stress the international nature of this threat. This type of governmental action is something that seems likely to eventually threaten us all, regardless of where we're located. As such, the best thing to do would be to discuss possible ways of protecting ourselves.
I would also like to apologize for accidentally insulting everyone who lives in places other than America. Phrasing my comment the way I did was a boneheaded thing to do. It currently reads like an elaborate form of trolling, as if I'm snubbing non-Americans. But in fact I'm just poor with the pen and in reality meant to debate the merits of starting companies in various countries, and to call attention to this international threat. I'm quite sorry for how it sounded. In the meantime, can anyone think of ways of protecting ourselves from centralized government action against businesses?
Most people don't realise that Russia is a brutal petro-chemical dictatorship in economical decline which is clamping down hard on human rights, freedom of the press and radicalising its population through propaganda.
I've been following the Crimea conflict very closely (which almost certainly is also what caused Pavel's departure) and the seriousness of the situation is heavily underestimated by the world.
The Russian economy is heavily dependent on gas exports, and both income from - and production of gas is declining. A small elite has been massively siphoning off wealth from those natural resources and is desperate to stay in control.
Given the situation they (rightfully) fear being overthrown and to prevent that they've started 'restoring Russia to it's former glory,' appealing to traditional family values by introducing anti-gay laws, introducing laws against protesting, laws against criticising Russia, shutting down independent media and distributing propaganda from the remaining station which gets ever more removed from reality by the day.
It is in that context that the VKontakte departure must be seen, and therefore it's difficult to make direct comparisons between Russia and the US: they are truly orders of magnitude apart right now.
P.S. It is important to keep in mind that you could also argue that something similar happened in the US with the NSA scandals but in the US none of the CEOs chose to resign.
The seriousness of the conflict depends on where you get your information, sadly.
The situation geopolitically seems pretty simple, in broad strokes. Too bad there's unfounded scaremongering on both sides(or should I say 3 or 4 sides).
It more seems that the seriousness of the conflict depends on whether you see this as an isolated incident (which just happens to be the worst violation of territorial integrity in Europe since WWII) or as yet another indicator that the exact same social dynamics that led us to WWII in the first place are intensifying significantly.
I'm curious as to what your take on this is then though ...
sure,but it's not like Kosovo ever happened... oh wait,NATO was on board with this...which just happens to be the worst violation of territorial integrity in Europe since WWIIIn Kosovo there was active, widespread genocide going on. Absolutely nothing of such kind was happening in Crimea.
Additionally the Kosovo constitution offered room for secession and it's secession was consequently recognized by the vast majority of the international community.
The votes on the UN council as to the legality of Russia's actions [1] say enough, but Huffinton Post wrote a fairly comprehensive article [2] about the topic.
P.S. If you plan to link to the RT counter-piece [3] just let me know and I'll list all the factual inaccuracies for you.
[1] http://www.thegatewaypundit.com/wp-content/uploads/2014/03/u...
[2] http://www.huffingtonpost.com/david-l-phillips/crimea-is-not...
[3] http://rt.com/news/kosovo-crimea-referendum-recognition-441/
Lies, lies, lies...
In Kosovo there wasn't widespread genocide, especially not before NATO started dropping bombs - by far biggest atrocities (not genocide) started after March 24, 1999.
Also you conveniently forgot those guys http://en.wikipedia.org/wiki/Kosovo_Liberation_Army#Status_a... - local Russians in Crimea didn't pull anything remotely similar and I guess that they could if they wanted to provoke conflict.
And if you plan to put some more lies about Kosovo I'll be glad to educate you more.
Normally the day I side with Serbian nationalists is a cold day in hell, but vasac is right. This is the end result of one of the worst kludges of the 1974 SFRY constitution, a master class document in doublespeak and not actually resolving issues between parties. Case in point: Hungarians and Albanians were "nationalities", not "nations". Why couldn't they be "nations"? Because they "already had one". Way to make your minorities feel disenfranchised at one fell swoop.
OK. I stand corrected on the genocide. Still; the NATO intervention was to stop a war between insurgents (supported by the populace) and a government that started waging war against the insurgents.
In that case the equivalent would have been for Russia to militarily support the situation in Kiev, and it bears no similarity whatsoever to invading and annexing the, at that point, completely peaceful Crimea.
First, I'm sorry for a hash tone of my first message.
Second, I could argue that Russians just skipped the insurgency part. It would be trivially easy for them to create/support insurgency at Crimea and leave Ukrainian forces with no good choice: either they retreat immediately or they retreat under Russian assault (which will be justified as a war/genocide/whatever prevention).
On Serbia/Kosovo: discrepancy between military might between Serbia and Albanians from Kosovo was so great that any insurgency was practically suicide. But if you know that you will be backed by NATO insurgency suddenly looks like a good idea. My point being that NATO action wasn't just consequence of war but part of a cause.
Might makes right - works everywhere.
Well; the Maidan insurgency was suicide for quite a few of the protesters. History is littered with insurgencies that won through losing.
But as for Crimea vs. Kosovo; without international intervention the Kosovo situation would still have been explosive. Crimea was already mostly independent and had a referendum for more independence coming up already and showed no signs of destabilizing.
Also; I'm not aware of dramatically self-serving incentives for NATO's intervention in Kosovo like there clearly are in Crimea (gas reserves, lease for black-sea naval base, destabilizing post-Maidan Ukraine, nationalization of Ukrainian assets, prestige through this 'little war' and restoring former USSR glory.)
My recollection from Kosovo was that NATO intervention was done begrudgingly in an honest attempt to stabilize an explosive situation.
Once again; I'm honestly curious about your perspective on this...
Problems in Kosovo were not something new, certainly they didn't occur because of Milosevic. His government, same as any Serbian or Yugoslav government in last 100 years, wasn't capable of solving those problems. Different things were tried, from brute force, to deep integration and back again to the brute force.
Communist government immediately after WWII even had plans for a wide Balkan federation with Albania as a part of Yugoslavia and maybe even Bulgaria, so they made some concession early on. As selimthegrim said we even had "nationalities" - in other countries that would be national minorities as Albania was their ethnic state, but minority term was deemed offensive so we invented another word. And after 1974 constitution in some way they had more rights than Serbs as while Kosovo was part of the Serbia it was also firsthand part of the federal state. So when some law on Serbia level had to be adopted they had a word in it, but when some other law had to be adopted just on the Kosovo level Serbia had no say in it. Even then there were strong separatist tendencies. Milosevic's rise to power was fueled by promises of curbing Kosovo's status. Of course Albanians were not happy, so to speak.
I could go on and on about this but bottom line is that they never wanted to be part of Serbia or Yugoslavia (and I don't blame them, neither would I in their place). So given that they represented almost 90% of population of Kosovo it's probably right for them to be independent.
The problem I have with this is that same rights do not universally apply to other people. As West politicians love to say Kosovo was "special case". Basically, they reserve right to arbitrary decide when will of the people should be respected and when not. They certainly can treat Serbia like that, but it looks like Russia reserved same rights as the West, and it has means to enforce them. Last week British FM said that "there can be no more re-drawing of borders in the Balkans" meaning that Bosnian Serbs cannot secede from Bosnia no matter what referendum results will be (of course there's no chance in hell to even hold a referendum as West will not allow that). But Scottish independence referendum will take place, so I'm confused again - are the Scots or the Serbs "special case".
As for NATO's enthusiasm for intervention in Kosovo please check Kissinger's take on Rambouillet Agreement [1] - and they didn't stabilize situation - they took a side in the war, won a war and final result is this [2] - Serbs are mostly expelled from Kosovo (civilians, not just military) or stuffed in small enclaves. And if you take a close look on that final result - just replace Serbs with Albanians in the previous sentence and you get instant switch from "stabilization" to war crimes. Go figure ;)
Also, compare that situation with Dayton Agreement - USA had enough leverage on all three sides and successfully forced them to sign agreement that nobody liked. On the other hand, during Kosovo crisis I can't recollect any situation where they put pressure on Albanian side and not that there were no arguments for it.
And for self-serving incentives for NATO's intervention - I have no idea. Maybe they concluded that Serbs had enough time to solve problems themselves, maybe they just didn't want to have Russian oriented spot in the middle of the new NATO countries, maybe NATO just searched for reason to keep existing (last instance of this is Crimea situation), maybe Clinton BJ was the reason. They know intervention wouldn't cost them much (they didn't expected that it would last more than a few days), so what the hell - compare that to Crimea situation where there's no consensus even on economic sanctions.
[1] http://en.wikipedia.org/wiki/Rambouillet_Agreement [2] http://en.wikipedia.org/wiki/Kosovo_war#Aftermath
Thanks for the response. It's a well-reasoned gem and I'm a wiser man for having read it.
In my mind the two are still categorically different, mainly due to the self-servingness and media contortions, but I agree that there's less factual differences than I thought before.
Well, I'm probably much more biased than I care to admit so someone else is probably a better speaker about Crimea than me. It's quite hard to get a good comprehension (and I really tried hard) of some events that happened in my immediate surrounding let alone a thousand kilometers away.
Common people stand no chance when mass media is skillfully deployed.
Oh boy.
I think you're somewhat over-exaggerating the situation. Yes, Russia has not been the most subtle in taking over Crimea, but I can say without a doubt that any of the major superpowers would do the same if a country nearby were to experience a coup d'etat. Especially if that country was strategically important.
While not technically legal, Crimea really is mostly comprised of Russians and has had a special legal status for ages. A 97% vote does not surprise me. Russians in other eastern european countries also reminisce of the "good old times".
I think much of the backlash is due to Russia being projected as the stereotypical evil commie.
I really don't want to venture into conspiracy theory territory, since that would probably hurt my credibility, but I would not be surprised to see the EU and US behind this as a means of trying to cut Russia off from the outside world(after inviting Ukraine into the EU failed). Don't forget the opposition has strong ties with the U.S.
This might be of interest to you. http://www.globalresearch.ca/ukraine-protests-carefully-orch...
Globalresearch is a credible think tank.
OK. It's pretty clear that you've been heavily exposed to a single perspective of the situation.
There is no way in hell 97% of the population voted in favor with 80+% turnout; especially given that 30+% of the population is Tatar or Ukrainian. Based on leaked reports to the Kremlin the real turnout is estimated at a bit over 30%.
Regardless; the referendum was literally held at gunpoint after all Ukrainian news had been shut off and Russian television showed massive fascists uprising and murder in Kiev, which heavily scared the population and did make a large portion of the population believe they were being rescued.
Thus, even if the results were true, it still would not have been a valid referendum.
As for the protests, based on direct sources from real people the protests were organize by just that: real everyday people.
Once again though; the regime was not overthrown by the protesters, but by Yanukovich losing moral authority after ordering shooting of civilians.
If you want to argue the snipers were also a false flag operation then you'd indeed be well into conspiracy nut territory; but I can also point you to videos of Ukrainian snipers assembling if you want.
Global Research also doesn't have that good of a reputation. In [1] it explicitly mentions one of it's main reality warping effects comes from a heavy reliance on Russia Today material.
I'm sorry, but YOU are the one who is heavily exposed to a single perspective. Keep watching your CNN.
I myself am from eastern europe and have first hand witnessed russian attitude towards post soviet satellite countries. Don't teach me what I know.
Literally almost everything you say is wrong. Referendum was not held at gunpoint. I've seen western sources use that phrase, so I know where you got it from.
It is a valid referendum because Crimea has a weird legal status, look up Autonomous republic of Crimea.
No, the protest most certainly was not organized by real everyday people. Strategically taking over buildings is not what real everyday people do.
I do want to argue that the situation with snipers was not one sided. Some sources say they shot at both, rioters* and the police.
Notice how I use the term rioters - that was not a protest.
P.S. I have no reason to be biased since I don't generally like Russians, especially the ones that stayed in satellite countries after the fall of the Soviet union. They have a habit of not learning the language and not respecting the host country.
P.S.S Learn fucking Russian, so that you can get both sides of the picture, not just biased rehashes of reuters/cnn/msnbc.
I've been following all international reporters on the ground from day one (Twitter journalism is truly a game-changer) and corroborating it by getting personal perspectives from people related to Maidan and within Crimea. My partner is Ukrainian from Russian parents and we regularly compare Russian and Western reporting, statements and propaganda.
All in all I'm quite sure I've got a pretty solid grip on the situation incorporating information from all perspectives.
As for a referendum at gunpoint; it's not really debatable as it refers to armed Russian forces having taken over Crimea during the referendum.
As for it's validity; it's not about the constitutional framework, it's about the occupation, selective media blackout, voting irregularities, lack of independent international observers etc. etc. The comparison with the internationally recognized Scottisch referendum [1] explains it well.
As for taking over buildings; I don't find it at all odd that a movement consisting mostly of the general population and also militant far-right extremists (disproportionately present due to obvious selection bias) operates strategically in a way that maximised disruption. Self-organisation is a much more likely explanation than nefarious foreign strategic advice.
As for the snipers; are you seriously arguing that the US shot these protesters as a false flag operation?
It sounds to me like, at the core, you just can't comprehend a bona-fide populist uprising lying the root of Euromaidan.
Have you considered that that might be because at some level it invalidates the learned helplessness many in post-Soviet states were raised with?
[1] https://secure.flickr.com/photos/foreignoffice/13306114335/
I don't have statistics but my colleague went to watch the referendum and 80% turnout is what he witnessed. Of course it was just one area of Simferopol.
http://breqwas.livejournal.com/301901.html in russian
My Russian is not that good, but doesn't this also mention some irregularities which cast some doubt on that number?
Regardless, if a single polling station in a fairly pro-Russian area, kept on its toes by (amateur) observers, gets a 75% turnout that makes an 80% turnout overall very unlikely given the boycott of the referendum by Crimean tatars.
What's your take on the 123% turnout in Sebastopol btw?
P.S. You are talking about turnout right? Because the votes being 80+% in favor is perfectly possible.
You can use google translate.
Yes there were irregularities, the process was either rough or rigged. However he was seeing a voluntary 75% turnout with exit pool showing more than 75% in favour.
>> I've been following the Crimea conflict very closely (which almost certainly is also what caused Pavel's departure) Reference is needed.
It says it in the article. Navalny was making statements condemning the Crimea annexation and giving advice on how best to apply economic sanction to the Kremlin-elite surrounding Putin.
After the US followed his advice Navalny even tweeted that he was packing his bags for jail because "someone was going to have to pay for [those sanctions]".
News about Pavel's departure appeared long before the conflict you're talking about. So these two events are not connected.
News about Pavel's departure started appearing ever since the hostile takeover well over a year ago. His actual departure was today which makes it very much possible, if not likely, that it was connected to recent events which undoubtedly resulted in additional pressure against his ideologies.
His list of reasons has been building up for years.
Russia in 2012 passed a law allowing censorship of 'pirate websites' and has been heavily abused. Vk has been making licensing deals with Sony and other labels. Pavel is a Libertarian and is against making the website 'corporate' (like facebook, motivated by money not freedom).
Both the Ukraine, arguments with shareholders and copyright pressure are recent. Putting them together he probably saw a restricted future with VK and now he has Telegram to fallback on, he now sees it an opportunity to quit.
However, Telegram has stated it will never charge or have ads, so my theory is he will be making more websites in the future, hopefully he will make websites which embrace his Libertarian ideals.
Thanks for the comprehensive overview! Sounds about right to me. I hadn't heard about the 'pirate website' law though. Do you have some more info on that?
Also, just to be clear, I wasn't arguing that the Ukraine conflict caused his departure. Just that it was at least a contributing factor and at worst the straw that broke the camel's back.
*2013 not 2012, my bad.
https://technology.ihs.com/440359/russia-introduces-first-on...
It's been in the talks since 2012, not passed until 2013. In 2012 they passed a law criminalizing viewing images of child exploitation, this was a big sign of things to come (previously to this law they were very free to do anything on the internet). I think it was also 2012 when the ROMS license was discontinued (making websites like AllofMp3, legalsounds.com illegal in Russia).
Roskomnadzor has used this new legislation to censor any website it wants to, drug, copyright, defamation, they'll find any excuse.
Here is a good article summarizing Vkontakte's recent copyright events: https://torrentfreak.com/russias-facebook-prepares-to-make-p...
They will be killing entire ecosystems of websites using Vk (video, image and audio), Pavel is against this but will get raided or censored for not complying.
It's been going downhill quickly for the past 2 years and shows my signs of slowing down.
So the US government is taking orders from the founder of a social network in Russia. I wonder how Obama is going to explain that now. Totally busted.
Navalny is a Russian opposition leader. The founder of VKontakte is Pavel.
My bad for mixing the names. While I don't have any objection to the argument that the US is working with support of the Russian opposition (and vice-versa), I think it's far fetched to think he will be held personally responsible for any sanctions that are brought upon Russia.
What I'm seeing here from Latin America is that very few people think these supposed sactions will have any impact. There are articles circulating in the media that it might actually be would for LA and Russia relationship.
Navalny, the Russian opposition, is already under house arrest and was threatened with jail just for 'breaking his house arrest' by publishing the blog post about his ideas on who to sanction; even before any sanctions were actually applied. The he'd be held personally responsible is not that far-fetched.
As for the lack of real impact; you're probably right. Most of the targeted officials assets are in Europe, not the US, and Europe's list was much weaker.
replace "Russia" with "US" and "petro-chemical" with "military-industrial complex" or "financial" and your whole comment still makes sense as well
Except that the US isn't in a steep decline. The US doesn't start invasions and pretends it's someone else's military. The US doesn't cancel leases for pro-Snowden news outlets. The US doesn't send protesters against election-fraud away for 5 years. The US doesn't introduce laws making it illegal to support gays in public. The US doesn't forcefully remove protesters against a potential war at first sight; even if they're just raising white protest flags.
The dynamics might be similar, if not universal, but the order of magnitude is truly different.
>The US doesn't start invasions and pretends it's someone else's military.
Drone strikes come to mind. Didn't the US claim that bombings in Yemen where the work of the local government?
That said, the order of magnitude is indeed different.
US didn't occupy Yemen and claim it's "local self-defense forces" and then rushed through a fake referendum to make Yemen part of the US, last time I checked. So I'm not sure what is here to compare. Each major country has intelligence and clandestine operations which are not publicly acknowledged, but it's different between cloak-and-dagger stuff and occupying a part of neighboring country and trying to present it as if they did it to themselves.
Actually all you described US does it as well. It's just Russian elites are less sophisticated and are more brutish. The process you see in Russia now, was done many years ago in US. For example why would you cancel leases of news outlets if you have complete and absolute control on MSM? Behind all that gold and glitter is the same nastiness and hate for the common man.
You mister read that :
http://en.wikipedia.org/wiki/Petrodollar_warfare
and then do more search on the internet about how USA are basically forcing everybody to buy oil in $$.
At least russia doesnt force other nations to trade gaz in rubs.
So yeah,russia is evil , but USA are even more evil.
EDIT:
downvote me all you want it's not just a conspiracy theory,that's a fact,but since we are on a pro american board, i did not expect anything else but downvotes.
There is a reason why USA invaded Irak or Libya,and it had nothing to do with promoting democracry.
It was about the fear of USA seeing Iraki and Libyan leaders trade their oil in something else than dollars.
And when the world revolts against this made up,military backed dollar domination, USA will fail hard. Because the dollar is backed by nothing but fear.
The article refers to "petrodollar warfare hypothesis". It doesn't provide any proof. In particular it doesn't prove any of the "forcing" that you refer to.
Was it ever in doubt that the USA is the best place to start a business? You have an English-speaking domestic market that accounts for 30% of the planet's GDP, huge talent pools, easy access to capital, a culture that encourages entrepreneurship, significantly above-average rule of law, strong corporate veils, and a mostly tolerable tax burden. It ain't perfect, but you can't do better anywhere else in this solar system.
Was it ever in doubt that the USA is the best place to start a business?
America is no. 14 on the list of best countries to start a business in. http://www.forbes.com/best-countries-for-business/list/
You need to be a little careful with these rankings, because they're subjective. Forbes, for instance, drastically prioritizes taxes for its rankings. The corporate tax rate in the US is higher than that of Ireland, and (as Forbes summary straightforwardly admits) that pushes the US down in the rankings.
For a startup, there are significantly more important factors to consider than the corporate tax rate, not least because most startups are managed to avoid taxable profits for the first several years of their existence (sometimes all the way up until IPO). For instance:
* The US offers at-will employment. Ireland, at the top of the list, has an Unfair Dismissal act that allows employees with a year of tenure to file claims not only if they're dismissed, but if they're "constructively" dismissed --- that is to say, if their role in the company is substantially altered in a way that allows them to claim that they're being "managed out" of the company. Constructive dismissal is a standard market clause for executives and acquirees in the US, but is certainly not a day-to-day feature of employment law.
* The World Bank Ease-of-doing-business index dings Ireland, putting them far below the US, for (among other things) the difficulty of enforcing contracts in Ireland; my tea-leaf-reading from the index's abstracted data is that you have a good certainty of enforcing a contract base in Ireland, but that the process is more time-consuming and expensive than in the US, which is ranked 50 places higher than Ireland (at #11 overall).
* Similarly, the World Bank dings Denmark (putting them 2 places below the US overall) because (among other things) it's significantly more difficult to incorporate in Denmark than in the US (where you can do it approximately as easily as ordering a non-one-click-compatible book from Amazon). Denmark also has mandatory severance of up to 6 months wages depending on tenure. 6 months wages isn't a big deal to any big company, but for a startup, it could change the calculus of when the company will need to shutter during a downswing to meet its legal obligations to employees; in the US, so long as you can make good on any current wages owed employees, you can run up until the last minute.
* Sweden, which Forbes ranks higher than the US, has intricate employment law rules that require not only a legally defensible just cause for termination, but also a good faith effort on the part of an employer to find another job for an employee even if just cause exists to fire them. Sweden also allows shareholders to personally sue directors in a variety of situations. There is no way Forbes actually believes Sweden is a better place to start a company than the US.
Here is a combination of factors that makes the US a good place to start a business:
* Extremely well-tested corporation law that makes the formation of a company, distribution of equity, resolution of disputes, and enforcement of ownership relatively predictable.
* Virtually no government interference with the formation of companies themselves, so that you could practically form a new LLC for every individual Github project you started, pay less for that than you would for hosting costs, and stand a very good chance of having those LLCs defend your interests in disputes.
* Multiple classes of corporation, convertible between each other, with some optimized for "click a button on a web page and create an LLC for my Github project", and others, not that much more expensive, that allow for multiple classes of shareholder, with the laws for those corporate forms predictable enough that hundreds of thousands of dollars of venture funding have become a standardized packaged product for promising startups (this is mind-boggling when you look at the societal infrastructure that enables it).
* A system of at-will employment that (for the most part) makes employment of workers almost risk free, so long as you don't play fast and loose with owed salary or tax withholdings.
* A tax system that is reasonably simple, not disastrously onerous, and in many ways optimized for entrepreneurs (for instance, the differing taxation schemes offered for salary versus distributions, or the ease of deducting business expenses).
* Extremely well-tested employment law that, among other things, makes it straightforward to retain 1099 contractors for one-off projects without risking their conversion into full-time employees with severance rights.
* One of the world's largest single borderless markets, such that you can start a company in Oregon and, with almost total certainty, be able to straightforwardly collect money for services (other than direct financial services, insurance, pharmaceuticals, and agriculture) from people in Florida.
* The host of the world's largest equities markets, so that investors in startups can plow money into companies knowing that if that company is the 1 in 20 that is going to go public, the most lucrative place for it to go public is the country of its origin.
The US is probably not the best place in the world to start a company. Forbes and the World Bank agree that Hong Kong and New Zealand are better. But running a company in New Zealand also requires you to domicile in New Zealand, which can complicate hiring, marketing, and (if you sell anything physical) channel delivery.
If we had single-payer health coverage, I think we'd be the best country to do business in.
I agree with most of your points, but:
> A tax system that is reasonably simple, not disastrously onerous, and in many ways optimized for entrepreneurs (for instance, the differing taxation schemes offered for salary versus distributions, or the ease of deducting business expenses).
Is objectively wrong. The US tax code was over 71,000 pages last I checked (in 2009 or so), and that's just the federal part. I have dealt with taxes in several jurisdictions, personal and business - and the US is by far the most onerous, most complicated among them. The business part is a little simpler than the personal part, but both are batsh*t crazy when compared to a lot of other places.
The differing taxation scheme seem to be quite universal these days (I don't know if historically this wasn't the case). The rates are effectively higher in the US, though it seems if you are big enough you can use loopholes to counter that.
The VAT common in Europe is onerous at the personal level (roughly comparable to state/city sales tax, although usually higher), but is almost invisible at the business level - "VAT" stands for "Value Added Tax" - it only gets paid on the added value. If my business buys laptops and supplies them to a customer, that customer pays VAT but I do not (whereas US style sales tax gets collected twice in this case). Expenses seem to be just as easily deductible, if not easier.
Furthermore, the US is actively hostile towards anyone who does anything financially outside the US. Got a bank account outside the US? You have a lot of onerous reporting to do (FBAR/FATCA) with very steep penalties for non compliance. Your company has such an account, and you have signing rights? You are still personally liable with the same steep penalties. Onerous does not begin to describe this.
If you're already a US Tax Payer living in the US (by being a citizen or a permanent resident), the US is probably the best place for you to do business in. If you are not yet subject to the craziness that is the US Tax Code, you should factor a few tens of thousands of USD per year for proper reporting, which might make it a less desirable place.
Consider businesses with a run rate of between 2-10MM USD as a group, first in the US and then in, say, Denmark or (to make it even simpler) Ireland.
Does the Danish or Ireland cohort tend to operate without the advice of tax accountants? My impression is that they do in fact tend to retain tax advisors.
The argument that the US tax system is particularly onerous is, I think, compelling only if you can demonstrate that it creates a de facto requirement for outside advisors that doesn't exist in other locales.
Otherwise, the complexity of the system (which is not what I was talking about) isn't much of an issue.
I have some experience with tax advisors, obviously, and they are not one of my big business expenditures. :)
> I think, compelling only if you can demonstrate that it creates a de facto requirement for outside advisors that doesn't exist in other locales.
Optimization of taxes is a constantly changing, narrow field of expertise - and the complexity of even "simple" tax systems is such that even a cheap, mediocre tax professional will usually save you more in taxes (compared to a "layman understanding" of taxes) than they cost. In this sense, no country is simple enough to operate without a tax advisor. In fact, in Israel where I now reside, it is effectively a requirement to have a CPA prepare and sign off your tax papers, even if your business did not have a single transaction that year. However, the reporting is simple (compared to the US, anyway) such that even if you had quite a bit of transactions, your advisor can finish it in an hour.
For similar complexity, I ended up paying my US tax advisor approximately twenty times as much as my Israeli one. I pay for quality in both places, and the hourly rate of the US CPA is approximately twice as much as the Israeli one (that's true in general comparing both markets). The US one just has about ten times as much work to do.
> Otherwise, the complexity of the system (which is not what I was talking about) isn't much of an issue.
I guess a tl;dr of my point would be: In most of the world, a reasonable course of action is to make plans for business purposes and then adjust them according to tax considerations, whereas in the US the reasonable course of action is to make plans based on legal&tax considerations and then adjust them for business purposes.
I agree that looking at the bottom line, it's just another business expense - I was just disagreeing with your assertion of a reasonable tax code. It is the case in the US (much more so than in Europe and other modern countries, in my experience) that where and how you incorporate, how you assign your IP, and how you time your transactions (short term/long term capital gains) can have a huge impact on your bottom line. Makes it much harder to reason about your actions, which is a non trivial (and hard to quantify) cost.
No accountants are very important also in Denmark. Danish company tax system is very very complicated. So you are correct.
In my state (New York), there is a sales tax exemption on all goods that are intended for resale, so in your case, only the customer would pay sales tax, and you would not.
However, you have to register with the state to collect sales tax in order to be allowed to buy things without paying tax.
To add to your point on equities markets: Baidu went public on the NASDAQ[0], and Alibaba is considering doing the same[1].
0. http://ir.baidu.com/phoenix.zhtml?c=188488&p=irol-faq_pf#261...
1. http://www.nasdaq.com/article/alibaba-considers-ipo-in-us-an...
The US is probably not the best place in the world to start a company. Forbes and the World Bank agree that Hong Kong and New Zealand are better.
What's (also) interesting about this short-list is a strong historical British influence.
Ooh, another one: as the world's reserve currency, the USD gets a purchasing power boost, so it's easier to expand US->rest of world than the other direction.
So say some journalists. The results speak for themselves.
Edit: In case it wasn't apparent, my "ever any doubt" question was rhetorical hyperbole. Any statement, no matter how self-evident, will have some people contradicting it.
Edit2: See mtrimpe's comment below; Forbes is probably optimizing for small business in their analysis instead of startups with potential for high scalability.
In case it wasn't apparent, my "ever any doubt" question was rhetorical hyperbole. Any statement, no matter how self-evident, will have some people contradicting it.
Your argument that the US is the best place to start a business is not in any way "self-evident", and you have provided no source or proof.
So say some journalists.
Their methodology seems sound.
"We determined the Best Countries for Business by looking at 11 different factors for 134 countries. We considered property rights, innovation, taxes, technology, corruption, freedom (personal, trade and monetary), red tape, investor protection and stock market performance. Forbes leaned on research and published reports from the Central Intelligence Agency, Freedom House, Heritage Foundation, Property Rights Alliance, Transparency International, the World Bank and World Economic Forum to compile the rankings."
http://www.forbes.com/sites/kurtbadenhausen/2011/10/03/the-b...
Did you actually find their methodology? I couldn't. I read the summary of the most recent rankings, which explained why the US was so far down the list (taxes), but not the scheme by which they consolidates all the sources they used and created a rating.
Given Forbes' own editorial slant, I don't think it's entirely unreasonable to look at these rankings as a simple coatrack for Forbes argument that the US corporate tax rate should be lowered.
If you could find the methodology document for Forbes ranking --- anything similar to the World Bank's ranking, which is itself not totally great, would be helpful --- I'd be grateful. This topic comes up a lot on HN.
They left out "size and wealth of domestic market" and "access to capital," which I suspect are the most important factors beyond a minimal level of market fairness.
It's really not self-evident that the vast majority of successful companies are started in the US?
As proven time and time again, most popular does not mean "the best".(especially, considering how many people there are in the US compared to any EU nation. That'd certainly explain the "number of successful businesses".)
Do you think those people starting companies would do any worse, if we placed them in, say, Denmark?
EDIT:Or maybe Israel, which has the highest density of start ups worldwide? I'd be curious to see the per capita numbers of countries.
> Do you think those people starting companies would do any worse, if we placed them in, say, Denmark?
Yes. Facebook, Apple, Google, Tesla, etc. would never have happened in Denmark. I'm really glad my parents did the annoying work of immigrating to the SF Bay Area from Germany when I was a kid. Otherwise I would have wasted years of my life doing it myself.
Did you watch the Elon Musk interview posted here the other day? He said more-or-less the same thing: it was really obvious, growing up in South Africa, that California was the place to be to make things happen.
Edit: I don't know much about Israel. They seem to be doing a pretty good job, based on what little I do know. It doesn't sound like they're at SF Bay Area levels yet, but making progress: http://aleph.vc/the-israel-venture-capital-index/
I don't see how you refuted my point. Have you tried anywhere else? Did Musk?
I'm not sure Paul actually even meant that; but in my mind the difference is pretty simple:
The US is set up to achieve the maximum amount of runaway breakout successes at the expense of average of quality of life.
The EU is set up to achieve the maximum amount of reasonably sustainable business providing for a decent quality of life.
Each type of business is much easier to start on the respective continent.
That's a great point. Domestic market size and access to capital don't matter much for starting a business where the end-goal is single-digit millions in annual revenue. The USA is quite obviously (to me, at least) the best place to "do a startup" but there could well be better places to "start a median small business."
For the record, the discussion started with VKontakte, which is definitely not in the "median small business" category.
And let's not get started on the different possible definitions of "quality of life" ;)
> there could well be better places to "start a median small business."
In Germany, which is the prime example of the EU model in that sense, there is even a word for that kind of business: Mittelstand (https://en.wikipedia.org/wiki/Mittelstand)
> And let's not get started on the different possible definitions of "quality of life" ;)
Good point; the EU definition would probably be having a roof over your head and ample free time to enjoy the bread and games in good health ;)
This is obviously not a topic that can have a conclusive resolution. There are too many factors at play here. I believe the preponderance of evidence is in favor of starting a business in the USA, specifically in one of the major innovation hubs.
I agree with you; tech hubs are extremely important, which is where Europe seems to be lagging behind.
I just think the reason they ARE lagging behind is because US is considered the default country to go for starting a business, without second thought.
EDIT:I should probably clarify - I meant the US is viewed as the best, hypothetically, not necessarily implying action.
The idea that Europeans uproot their families and move to the US without a second thought is quite unlikely.
Edit: changed to unlikely.
Ludicrous is the wrong word. The decision to move to the US might be rational (I sure think it is), or, like lots of other things people do when they start businesses, it might be irrational. Reasonable people could debate this without mocking each other, right?
One could argue those two factors are very important if you want to take a shot at creating the next Google or Facebook (which an unusually high percentage of people here might aspire to) and less important if you're aiming for a lifestyle business (perhaps more typical).
Yeah, that seems to be the underlying mismatch in assumptions that started this debate in the first place. Glad we've figured that out :)
I think "size and wealth of domestic market" and "access to capital" are the two most important ones as well. China and maybe India are going to test this hypothesis sometime within my life expectancy, I believe. Exciting times.
Denmark is considered one of the best places to start a company, but that is based on the bureaucratic burden of starting a company.
It is a very different thing to actually scale that company to any significant size there.
The metrics used to measure these things are fundamentally flawed as they look at the institutional side of things not on the reality that is running a business and growing a company.
It is a very different thing to actually scale that company to any significant size there.
Yet, Danish companies like Lego, Carlsberg and Maersk (whose subunit Maersk Line in itself is the largest company of its kind in the world) seem to be doing fine.
they are old companies, we are talking getting it of the ground not old industries made in very different times
I can't believe Belgium is better for starting a business..
Paperwork takes forever (unless you earn less then 15.000 €/ year). Taxes are insanely high (highest of the world) Employees are the most expensive in the world
This list ain't correct, that's easy to see as a Belgian... Or it should be very irritating to start a business in United States.
I do believe one of the beste places is Ireland though
Taxes are the thing holding it back. With Obamacare, if you're in business in California making over $250k/year personally, you'll pay 53% in taxes (38% Federal, 12% State, 3% Obama).
If you're a small business owner that owns 100%, you really own 47%. You're a minority shareholder in your own company.
"30% of the planet's GDP" more like 20% actually, 25% tops
You're right, apologies. My number is outdated.
> I'm saying that in order to spark a debate and challenge that belief. Would anyone please list some actions taken by the US government which is similar in nature to the takeover illustrated here?
Killing Lavabit for instance?
The US didn't kill Lavabit, so much as Lavabit decided to start an untenable business: one in which they vouchsafed secrecy to their customers but retained the ability to compromise that secrecy.
To understand how dumb that is, consider that AOL(!) runs a popular messaging service on which thousands of people exchange secure messages using OTR-enabled clients, and AOL could not be "killed" the way Lavabit was: the DOJ can't coerce AOL into betraying OTR-protected users, because AOL simply doesn't have that ability.
The reason Lavabit did have that ability is that getting users to install software is inconvenient and drastically harms adoption. Lavabit took a shortcut, and their users shared the resulting pain.
If you review the list of countries preceding the US on the Forbes list posted upthread, you won't find too many that wouldn't have left Lavabit similarly exposed.
Yes, Lavabit made a serious mistake of leaving a technical ability to compromise their users. However it doesn't change the fact that US killed it since the government wanted to have access to all users' data without any restrictions and warrants. Lavabit's mistake doesn't in any way reduce the abusive nature and unconstitutionality of that move.
I'm assuming it doesn't change your mind at all that Levison cooperated with a series of unrelated preceding warrants, handing over user information, and that (as I understand it) the DOJ only demanded their expansive intrusion after Levison refused to comply in a similar fashion to a warrant apparently related to Snowden, with whose politics Levison agreed.
He cooperated with warrants targeted at specific suspects. That's rather normal. He refused to cooperate with request to give them access to all users. They couldn't possibly have such warrant by considering them all suspects at once. They just told him, hand us over the keys or else. I'm not aware that he refused a targeted warrant on Snowden alone specifically. Or may be I missed that being reported somewhere.
I don't think that's accurate. My understanding is that Levison was confronted with a pen/trap (metadata-only) order for mail related to the Snowden account, refused it, and was then subjected to an escalating series of demands once the DOJ had "lost faith" in his cooperation.
Orin Kerr, who is one of Andrew Aurenheimer's attorneys in his appeal of felony CFAA charges, has a good starting point for what happened in the case, here:
http://www.volokh.com/2013/11/14/thoughts-doj-brief-lavabits...
So why did he refuse the targeted request first? His reasons given later applied to his refusal to bulk data collection not to the targeted one.
I don't know what this question has to do with anything I've said.
See below: https://news.ycombinator.com/item?id=7513078
Not somewhere, pretty much everywhere.
http://www.newyorker.com/online/blogs/elements/2013/10/how-l...
I think your idea of how the case developed is fairly inaccurate.
This article doesn't explain why he refused what they called
> The order, issued under the Stored Communications Act, required Lavabit to turn over to the F.B.I. retrospective information about one account, widely presumed to be that of Snowden.
Sure, but you can make some reasonable guesses from other available sources, including his own statements. But his motivation is not really the issue we were discussing - it was whether the government just up and destroyed Lavabit on a whim. You said "it doesn't change the fact that US killed it since the government wanted to have access to all users' data without any restrictions and warrants." It doesn't change the fact because the fact is not a fact.
However you want to interpret his actions, there's little doubt that Lavabit's grief was entirely self-inflicted.
My point is, since he didn't refuse previous targeted requests from authorities, it's reasonable to assume that this case was somehow different. I.e. for example it was formally targeted, but in practice they demanded more than necessary, or it wasn't technically possible to do what they wanted without compromising others who weren't suspects, or something of that sort. So without knowing his reasoning it's not obvious that it's "his fault" and government didn't want to kill Lavabit originally or government didn't overstep its power to begin with.
Totally agree with you shmerl, try using lavaboom.com, end2end encryption, zero knowledge policy and outside US jurisdiction.
In the early days of odnoklassniki and VKontakte there was a joke in Russia that KGB invented them as better version of its secret files on people. Now it does not look like a joke anymore.
Actually it was originally a serious concern with the Facebook where CIA originally invested through one of its tech funds. KGB is not that smart :)
I don't think the concern ever went away. And with all the snowden revelations so far, I guess it is reasonable to promote it from concern to near certainty.
For UK readers and or football fans, the Alisher Usmanov mentioned, who now controls VKontakte, is the same Alisher Usmanov who owns a large stake in Arsenal FC.
He also owns a stake in Odnoklassniki, another Russian social media site, which is "for classmates and old friends", a bit like Friends Reunited:
The remaining 40 percent of VK belonged to the Mail.ru group, co-owned by … Alisher Usmanov.
Usmanov owns shares in a lot of Silicon Valley companies.[1] Mail.ru's former chairman, Yuri Milner, funded the automatic Y Combinator investments from 2011-2013.[2]
1: http://www.usm-group.com/internet.html
Facebook, Apple, Twitter, Groupon, Zynga, Spotify, Zalando, ZocDoc, Airbnb, Alibaba and 360buy.
2: http://www.reuters.com/article/2013/12/16/us-venture-milner-...
As a long time Arsenal fan, fuck Usmanov.
For those who don't know what VKontakte is (I didn't), it is the biggest social network after Facebook with "over 100 million active users" according to vk.com, which they own.
More information: http://en.wikipedia.org/wiki/VK_(social_network)
Perhaps China has a few bigger networks.
Minor nit, but your linked reference notes:
[VK] is 8th most popular social networking site in the world
http://www.ebizmba.com/articles/social-networking-websites
[This list itself may be open to question, however. See for example some major exclusions:
http://www.businessinsider.com/a-quick-guide-to-chinas-socia...]
And it has an immense selection of music and video. I mean, positively incredible. Before Spotify swept up just about every single artist ever known to man, VK was the place to find recordings of even that obscure 80s band you saw down the New Cross tavern on a Tuesday night with seven other people and a dog. Better selection than Oink in its heyday. And if you're Russian, there's no reason to ever go anywhere else for film or television.
Utmost respect to Pavel for the courage. When NSA pushed the US companies they all, ALL CEOs just complied. Facebook,Google, Yahoo... all of them....
Does anyone still trust centralized social networks these days?
Umm, I personally don't, but given there's 228 million users of VK and 1.23 billion users of FB… Yeah, I guess somebody does.
I think anyone who had actually valued their privacy and spent a few minutes thinking about it, did not trust one to start with.
And the rest still seem to trust it.
The article tries to make out of thin air an impression that Kremlin took over VK by force, or something like that. Which is a complete bullshit IMHO.
Durov and others just exchanged their shares to cash, that's all.
Trying to mention this together with the fact that Durov disobeyed traffic cop order and hit him with his car (he did, that's a proven case, there is a video), doesn't make it a "Kremlin forceful takeover of VK"
Selling shares and resigning as CEO were two separate events.
two related events
This was in the related article that talked about how Putin muscled his way into the company before Durov sold off his shares:
"It essentially means that there's a glass ceiling to how big you can grow your company, and how influential your company can be in the Russian internet space before the government begins to take interest in it,"
http://www.theverge.com/2014/1/31/5363990/how-putins-cronies...
Isn't this how it's always been in Russia?
Isn't this how it's always been in US? We all know that Facebook does not work with government.
Right?
This kinda puts Telegraph project in a different light, doesn't it?
A worse light, perhaps? Telegram sells snake oil and ignores security recommendations while billing itself as secure. They may only be "saved" because they actually believe what they're selling (although they shouldn't after being shot down so quickly).
Snap out of that mindless Telegram bashing loop, will you?
If anything, this CEO departure only shows that HN got the motivation for Telegram completely wrong. The assumption behind that gang up was that Telegram was trying to sabotage online privacy, because what else a Facebook-like entity may be doing in the domain of secure communications. Guess what? There was more to the picture than met the eye.
There was no assumption of sabotage that I saw. Just a bunch of stubbornness while ignoring security expert's suggestions, followed by a compromise of their highly touted security.
What part did I miss?
It was a joke.
Did someone consider the fact that this might be an April 1st joke?
It's not. It's been a long coming process.
Could you provide some proof links please? Because that thing sounds really unbelievable, and given the date… That's why I hate that stupid 'holiday' so much!
http://www.kommersant.ru/doc/2443179 (in Russian, but it's more-or-less respectable newspaper)
Thanks. I speak russian and that actually seams to be true (regardless the newspaper, I just didn't know that he sold his part a long time ago already). In fact I hoped that stating that "it was long time coming" can be confirmed by related non-01.04-dated posts. But that selling stocks, etc. — yeah, it doesn't sound like a joke anymore.
A journalist I know confirms it's true (coming from good sources he says). Also several Russian media news sites (that have good ties with VK) confirm it's not a joke.
Ouch! In the end, it was a joke.
"I'm not going anywhere — and remain the CEO of VKontakte," Pavel Durov wrote on his VKontakte account. And who is the stupid one now?
You do know that the skepticism you have about news articles on April 1 ought to be applied on every other day of the year, right?
Not to that extent.
Who would have thought that it was a joke! Let's down vote my original skeptical post even more!