--- begin forwarded text Mime-Version: 1.0 Date: Sat, 12 Aug 1995 00:01:58 From: infocker@megaweb.com Sender: infocker@megaweb.com () (from unknown.aol.com 205.188.2.111) To: www-buyinfo@allegra.att.com Subject: Cyber Economy--Govts. Cannot Control Thought Mr. Hettinga might particularly appreciate this perspective. Jim Rapp Alexandria, Virginia "give me more info" As always, do not send the copyright police after me. LONDON - Growing business on the Internet computer network could allow companies and individuals to avoid taxes and build up a black economy increasingly out of range of government intervention and regulation, computer experts say. People will be able to download computer programs from Philadelphia to Paris or buy books from Madrid in Manila, avoiding export or import duties and sales taxes, as well as bypassing government trade statistics. "Electronic purses," loaded from banks down telephone lines, could become the favored means of payment for fast, anonymous and secure payments, with currencies of choice becoming more exotic, depending on what is acceptable to dealmakers. "Cyberdollars," expatriate U.S. currency zapping across telephone lines between computers, could add to problems posed for authorities by existing funds outside national borders. Deals on the Internet are mainly completed by credit card at present. But electronic purses could lead to a buildup of currency beyond the control of governments and central banks, further limiting their influence on economies and markets and making traditional monetary tools like interest rates less effective. "Online business will involve much more economic activity outside the control and ambit of government," Madsen Pirie, director of the Adam Smith Institute, a right-wing British think-tank, told Reuters. "Government will have to limit its ambitions. Just like governments in the modern world find it difficult to have exchange control; they can't control billions of dollars of cash sloshing around foreign exchange markets," he said. Business is fairly modest now but will increase exponentially, Pirie forecasts. The U.S. Commerce Department has said electronic cash will account for 20 percent of U.S. purchases by 2005, up from just over 4 percent last year and compared with just over 16 percent forecast by 2000. Leaders of the information technology industry believe that the embryonic stage is over and are wary of government action, which they feel might inhibit growth. Analysts reckon that any attempt to regulate cybermarkets is likely to be futile. The Adam Smith Institute's Pirie agrees, predicting: "Governments will fail if they try to control this. They always have when they try to hold back the way history is going." - - - - - Copyright, Reuters America Inc. All rights reserved --- end forwarded text ----------------- Robert Hettinga (rah@shipwright.com) Shipwright Development Corporation, 44 Farquhar Street, Boston, MA 02131 USA (617) 323-7923 "Reality is not optional." --Thomas Sowell
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