8 ms·

You're referring to the process of finalizing a treaty. That would be conceptually similar to "executing" an agreement between parties—the most important step t

You're referring to the process of finalizing a treaty. That would be conceptually similar to "executing" an agreement between parties—the most important step that makes it legally binding! But "reaching a deal" and "executing the agreement" are often different steps. When we have discussions with a client, and we negotiate on the terms we can reach an agreement on the negotiation before we actually execute the contract. After reaching satisfactory terms in the agreement, I need to run the agreement by my business partner and ensure he approves. Sometimes the person who actually signs the contract may be a different party that I've never met or talked with during any part of our discussions. All of which is to say the language here seems appropriate. The G7 has reached a deal—that doesn't mean the deal is now effective or legally binding. Deals that have been reached can still fall through. But the G7 has reached a deal. What they haven't done is yet made it legally binding through a formal treaty process.

rufus_foreman 5y ago
>> After reaching satisfactory terms in the agreement, I need to run the agreement by my business partner and ensure he approves Do you think Mitch McConnell sees US Treasury Secretary Janet Yellen as his business partner? Or vice versa? That's your perception? >> The G7 has reached a deal—that doesn't mean the deal is now effective or legally binding So if I'm negotiating with you and you tell me we have a deal, I should consider that to be something that may or may not happen, may or may not be effective, and may or may not be legally binding? Which car company do you work for?
- YZF 5y ago
  There's all sorts of outcomes here. While you may be right that the US will not sign on to the deal it might still have to deal with some consequences. E.g. while Yellen may not have the ability influence US tax laws there are also foreign tax laws that are part of this over which McConnell has no control. Let's say the rest of the G7/G20/OECD changes the way they tax global companies, if the US doesn't ratify their side there's still plenty of real world consequences. I think Yellen's agreement does count as in this is the US's (sort of foreign policy?) position, i.e. the rest of the world can proceed to make changes based on that agreement even though Yellen does not have the authority to commit to changing US tax laws.
  - rufus_foreman 5y ago
    >> I think Yellen's agreement does count as in this is the US's (sort of foreign policy?) No it doesn't work like that. To get anything done, you need Republican votes. I have no idea, I haven't checked this afternoon, how many Republican votes do you have for a minimum corporate tax? That's what I want to know, I'm guessing it is zero, but let me know what the number is.
    - toomuchtodo 5y ago
      Reconciliation requires no Republican votes. https://www.brookings.edu/blog/up-front/2021/02/05/what-is-reconciliation-in-congress/ https://www.brookings.edu/blog/up-front/2021/02/05/what-is-r...
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      - rsj_hn 5y ago
        You are not going to ratify a treaty with the required 2/3 votes in the Senate via reconciliation.
        deleted 5y ago
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        ncallaway 5y ago
        You don't need to ratify a treaty through reconciliation. There's no need for this to be done with a formal treaty. It could simply be each of the nations passing laws that do the same thing. If the Senate passes a law that changes the corporate tax rate to a certain amount, that is a budgetary measure that could absolutely be passed with reconciliation. Yes, this law wouldn't be a treaty, but it could have a similar effect.
        rsj_hn 5y ago
        > If the Senate passes a law that changes the corporate tax rate to a certain amount, that is a budgetary measure that could absolutely be passed with reconciliation. If it was revenue-neutral, sure. That is unlikely to be the case with changes to corporate tax rates. And even then, you are going to have a hard time getting even 50 votes.
- Taylor_OD 5y ago
  >> So if I'm negotiating with you and you tell me we have a deal, I should consider that to be something that may or may not happen, may or may not be effective, and may or may not be legally binding? I hope you don't touch contracts in your job. Until a contract is signed nothing is official.
  - rufus_foreman 5y ago
    OK. Until a contract is signed, something is not a "historic" deal, is that right?
- ncallaway 5y ago
  Assume we’re going back and forth in negotiations. After a few back and forth a, with small changes each time, I send you over some language and you say: “That’ll work, I’ll draw up a contract and send it over to you”. At that point, I would tell people internally to my company that we have a deal with that client. But we don’t count on that revenue arriving, until we have a signed contract in place. Anything can happen between the negotiation and the contract being signed. The client could come back to us and say “there’s been a sudden change in priorities on our end, and we’re cancelling the project”. Or they might come back with any other change that they want “when I sent this to my VP, he said the top line number wouldn’t work, and we need to move it again, I’m so sorry!” Yes, we don’t consider anything to be legally binding until the contract is signed. We “had a deal”, but deals can fall through. If you deal in any contract worth more than a few hundred dollars, I really recommend you take the same attitude: everything is provisional until the final agreement is written down and signed. > Which car company do you work for? Was that necessary? Really? You can make your point without attempting to attack people.
  - rufus_foreman 5y ago
    "everything is provisional until the final agreement is written down and signed" Here's what I read: "The G7 group of advanced economies has reached a historic deal to make multinational companies pay more tax" Is that true?
    - ncallaway 5y ago
      > > "The G7 group of advanced economies has reached a historic deal to make multinational companies pay more tax" > Is that true? Yep! Because a "deal" can be something that is provisional. "Reached a deal" to me doesn't in any way mean that the deal has been executed, finalized and is legally binding. It means the first step of negotiations has been completed and all parties are agreeing to the terms of the deal. Look, we're just arguing about the semantics of how final "reached a deal" is. I think it's not very final (especially when discussing large multiparty negotiations like the ones described here). You seem to think it refers to an absolutely final step. That's fine! English is messy and we can disagree about what specific phrases mean. I'll just caution you that most of the world will use the phrase "reached a deal" to refer to negotiations that are preliminarily complete, but the terms not having been formally adopted or legally finalized. For example the "Brexit deal" was "reached" on December 24, 2020 (https://www.cnn.com/2020/12/24/europe/brexit-deal-uk-eu-gbr-intl/index.html https://www.cnn.com/2020/12/24/europe/brexit-deal-uk-eu-gbr-...). The deal wasn't approved by the British parliament until December 30, 2020 (https://news.yahoo.com/uk-parliament-approves-historic-brexit-deal-144836996.html https://news.yahoo.com/uk-parliament-approves-historic-brexi...). That deal went into effect on January 1, 2021. However it wasn't "finalized" until it was also ratified by the EU parliament on April 28, 2021 (https://www.france24.com/en/europe/20210428-european-parliament-approves-post-brexit-trade-deal-with-uk https://www.france24.com/en/europe/20210428-european-parliam...), nearly 5 months after it had gone into effect!
wolverine876 5y ago
> You're referring to the process of finalizing a treaty. That would be conceptually similar to "executing" an agreement between parties It's not even that. Most international agreements are executed without a treaty.
- skissane 5y ago
  > It's not even that. Most international agreements are executed without a treaty. Only in the US (and possibly a handful of other countries which copy the US approach). Under international law, all legally-binding international agreements are treaties. What the US calls "international agreements" are treaties from the non-US point of view.
  - wolverine876 5y ago
    Interesting. I would think a treaty requires all parties to it to think it's a treaty. Any idea where I can read a bit more about the fundamentals? But regardless, not every agreement is ... > legally-binding That term has a different, and as I understand, more nebulous meaning under international law?
    - skissane 5y ago
      > I would think a treaty requires all parties to it to think it's a treaty. Well, even the US agrees that "international agreements" are "treaties" in the international law sense, despite not being "treaties" in the US domestic law sense. > Any idea where I can read a bit more about the fundamentals A lot of what I know about this topic I learned from reading the Third Restatement of the Foreign Relations Law of the United States – https://www.ali.org/publications/show/foreign-relations-law-united-states-rest/ https://www.ali.org/publications/show/foreign-relations-law-... Unfortunately it isn't easy to get your hands on. You can buy a hardcopy for US$173 plus shipping. Or you can do what I did, and read it for free in a university library. (It is also included in Westlaw subscriptions, but unless you already have access to one, buying the hardcopy would probably be cheaper.) The international law on this topic is mostly contained in the Vienna Convention of the Law of Treaties of 1969 – https://legal.un.org/ilc/texts/instruments/english/conventions/1_1_1969.pdf https://legal.un.org/ilc/texts/instruments/english/conventio... > That term has a different, and as I understand, more nebulous meaning under international law? The most common way to make an international agreement not legally binding is to put a clause in there explicitly stating that it isn't legally binding. When the agreement explicitly states it isn't legally binding, then it clearcut isn't. If an agreement is in the usual written form of a finalised formal agreement, it is generally going to be assumed to be legally binding unless it explicitly states it isn't. Generally speaking, to be binding under international law, the parties have to have "international legal personality". That basically means the parties must be the national governments of sovereign states, or international organizations established by treaty. An agreement involving private corporations, private individuals, subnational governments, non-governmental organisations, etc, generally isn't going to be legally binding under international law, even if it also includes national governments among its parties. Occasionally, dependent territories are granted power by the national government to sign legally binding international treaties on certain topics (such as Hong Kong and Macau), but that is an exception to the general rule. There are grey areas which lawyers and scholars will debate, but it rarely turns into a live issue in practice.
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rayiner 5y ago
Your analogy is flawed because you seem to be assuming that the people with execution authority are the ones who reached an agreement in principle. You’d expect them to succeed in papering it up. That’s not the case here. The agreement in principle was reached by someone who has no power to do anything with regards to corporate taxes. Congress sets U.S. tax law and agrees to treaties. To do that, you need 60% or 66% of the Senate. It’s like the CFOs reaching an “agreement in principle” to something that requires Board approval—and a big chunk of the Board is hostile to management.
- lukeschlather 5y ago
  > The agreement in principle was reached by someone who has no power to do anything with regards to corporate taxes I think you are considerably understating the power of the G7 finance ministers including the US Secretary of the Treasury. Sure, they can't ratify a treaty without the cooperation of congress. They're still extraordinarily powerful individuals and have loads of direct authority to shape tax policy.
  - kortilla 5y ago
    They can certainly shape implementation details not defined by laws, but they can’t create laws or change existing ones.
- ncallaway 5y ago
  My analogy is really just a reference to what "reached a deal" colloquially means. "reached a deal" doesn't mean the deal absolutely 100% will be implemented. It means, the referenced parties have reached an agreement to something. In this case, the leaders of the G7 countries have reached an agreement among themselves to have a minimum corporate tax rate. Note that the United States has no obligation according to this deal—only Joe Biden has agreed the deal. And Joe Biden has no legal obligation under the deal, he merely has a reputational one. Since the agreed minimum corporate tax rate is 15%, and the United States corporate tax rate is 21% there's literally nothing Joe Biden needs to do in order to meet the terms of the deal he made with the other G7 leaders. If they want to turn this into an international treaty, absolutely, GOP Senate votes will be needed (though, given that the treaty would create a floor that's 6 percentage points below our current tax rate, I would imagine those would be attainable votes—if the GOP created a global floor that was lower than our tax rate, they could use it to argue for lowering our corporate tax rate).

rufus_foreman 5y ago

>> After reaching satisfactory terms in the agreement, I need to run the agreement by my business partner and ensure he approves Do you think Mitch McConnell sees US Treasury Secretary Janet Yellen as his business partner? Or vice versa? That's your perception? >> The G7 has reached a deal—that doesn't mean the deal is now effective or legally binding So if I'm negotiating with you and you tell me we have a deal, I should consider that to be something that may or may not happen, may or may not be effective, and may or may not be legally binding? Which car company do you work for?

YZF 5y ago
There's all sorts of outcomes here. While you may be right that the US will not sign on to the deal it might still have to deal with some consequences. E.g. while Yellen may not have the ability influence US tax laws there are also foreign tax laws that are part of this over which McConnell has no control. Let's say the rest of the G7/G20/OECD changes the way they tax global companies, if the US doesn't ratify their side there's still plenty of real world consequences. I think Yellen's agreement does count as in this is the US's (sort of foreign policy?) position, i.e. the rest of the world can proceed to make changes based on that agreement even though Yellen does not have the authority to commit to changing US tax laws.
- rufus_foreman 5y ago
  >> I think Yellen's agreement does count as in this is the US's (sort of foreign policy?) No it doesn't work like that. To get anything done, you need Republican votes. I have no idea, I haven't checked this afternoon, how many Republican votes do you have for a minimum corporate tax? That's what I want to know, I'm guessing it is zero, but let me know what the number is.
  - toomuchtodo 5y ago
    Reconciliation requires no Republican votes. https://www.brookings.edu/blog/up-front/2021/02/05/what-is-reconciliation-in-congress/ https://www.brookings.edu/blog/up-front/2021/02/05/what-is-r...
    - deleted 5y ago
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    - rsj_hn 5y ago
      You are not going to ratify a treaty with the required 2/3 votes in the Senate via reconciliation.
      - deleted 5y ago
        [deleted]
      - ncallaway 5y ago
        You don't need to ratify a treaty through reconciliation. There's no need for this to be done with a formal treaty. It could simply be each of the nations passing laws that do the same thing. If the Senate passes a law that changes the corporate tax rate to a certain amount, that is a budgetary measure that could absolutely be passed with reconciliation. Yes, this law wouldn't be a treaty, but it could have a similar effect.
        rsj_hn 5y ago
        > If the Senate passes a law that changes the corporate tax rate to a certain amount, that is a budgetary measure that could absolutely be passed with reconciliation. If it was revenue-neutral, sure. That is unlikely to be the case with changes to corporate tax rates. And even then, you are going to have a hard time getting even 50 votes.
Taylor_OD 5y ago
>> So if I'm negotiating with you and you tell me we have a deal, I should consider that to be something that may or may not happen, may or may not be effective, and may or may not be legally binding? I hope you don't touch contracts in your job. Until a contract is signed nothing is official.
- rufus_foreman 5y ago
  OK. Until a contract is signed, something is not a "historic" deal, is that right?
ncallaway 5y ago
Assume we’re going back and forth in negotiations. After a few back and forth a, with small changes each time, I send you over some language and you say: “That’ll work, I’ll draw up a contract and send it over to you”. At that point, I would tell people internally to my company that we have a deal with that client. But we don’t count on that revenue arriving, until we have a signed contract in place. Anything can happen between the negotiation and the contract being signed. The client could come back to us and say “there’s been a sudden change in priorities on our end, and we’re cancelling the project”. Or they might come back with any other change that they want “when I sent this to my VP, he said the top line number wouldn’t work, and we need to move it again, I’m so sorry!” Yes, we don’t consider anything to be legally binding until the contract is signed. We “had a deal”, but deals can fall through. If you deal in any contract worth more than a few hundred dollars, I really recommend you take the same attitude: everything is provisional until the final agreement is written down and signed. > Which car company do you work for? Was that necessary? Really? You can make your point without attempting to attack people.
- rufus_foreman 5y ago
  "everything is provisional until the final agreement is written down and signed" Here's what I read: "The G7 group of advanced economies has reached a historic deal to make multinational companies pay more tax" Is that true?
  - ncallaway 5y ago
    > > "The G7 group of advanced economies has reached a historic deal to make multinational companies pay more tax" > Is that true? Yep! Because a "deal" can be something that is provisional. "Reached a deal" to me doesn't in any way mean that the deal has been executed, finalized and is legally binding. It means the first step of negotiations has been completed and all parties are agreeing to the terms of the deal. Look, we're just arguing about the semantics of how final "reached a deal" is. I think it's not very final (especially when discussing large multiparty negotiations like the ones described here). You seem to think it refers to an absolutely final step. That's fine! English is messy and we can disagree about what specific phrases mean. I'll just caution you that most of the world will use the phrase "reached a deal" to refer to negotiations that are preliminarily complete, but the terms not having been formally adopted or legally finalized. For example the "Brexit deal" was "reached" on December 24, 2020 (https://www.cnn.com/2020/12/24/europe/brexit-deal-uk-eu-gbr-intl/index.html https://www.cnn.com/2020/12/24/europe/brexit-deal-uk-eu-gbr-...). The deal wasn't approved by the British parliament until December 30, 2020 (https://news.yahoo.com/uk-parliament-approves-historic-brexit-deal-144836996.html https://news.yahoo.com/uk-parliament-approves-historic-brexi...). That deal went into effect on January 1, 2021. However it wasn't "finalized" until it was also ratified by the EU parliament on April 28, 2021 (https://www.france24.com/en/europe/20210428-european-parliament-approves-post-brexit-trade-deal-with-uk https://www.france24.com/en/europe/20210428-european-parliam...), nearly 5 months after it had gone into effect!

wolverine876 5y ago

> You're referring to the process of finalizing a treaty. That would be conceptually similar to "executing" an agreement between parties It's not even that. Most international agreements are executed without a treaty.

skissane 5y ago
> It's not even that. Most international agreements are executed without a treaty. Only in the US (and possibly a handful of other countries which copy the US approach). Under international law, all legally-binding international agreements are treaties. What the US calls "international agreements" are treaties from the non-US point of view.
- wolverine876 5y ago
  Interesting. I would think a treaty requires all parties to it to think it's a treaty. Any idea where I can read a bit more about the fundamentals? But regardless, not every agreement is ... > legally-binding That term has a different, and as I understand, more nebulous meaning under international law?
  - skissane 5y ago
    > I would think a treaty requires all parties to it to think it's a treaty. Well, even the US agrees that "international agreements" are "treaties" in the international law sense, despite not being "treaties" in the US domestic law sense. > Any idea where I can read a bit more about the fundamentals A lot of what I know about this topic I learned from reading the Third Restatement of the Foreign Relations Law of the United States – https://www.ali.org/publications/show/foreign-relations-law-united-states-rest/ https://www.ali.org/publications/show/foreign-relations-law-... Unfortunately it isn't easy to get your hands on. You can buy a hardcopy for US$173 plus shipping. Or you can do what I did, and read it for free in a university library. (It is also included in Westlaw subscriptions, but unless you already have access to one, buying the hardcopy would probably be cheaper.) The international law on this topic is mostly contained in the Vienna Convention of the Law of Treaties of 1969 – https://legal.un.org/ilc/texts/instruments/english/conventions/1_1_1969.pdf https://legal.un.org/ilc/texts/instruments/english/conventio... > That term has a different, and as I understand, more nebulous meaning under international law? The most common way to make an international agreement not legally binding is to put a clause in there explicitly stating that it isn't legally binding. When the agreement explicitly states it isn't legally binding, then it clearcut isn't. If an agreement is in the usual written form of a finalised formal agreement, it is generally going to be assumed to be legally binding unless it explicitly states it isn't. Generally speaking, to be binding under international law, the parties have to have "international legal personality". That basically means the parties must be the national governments of sovereign states, or international organizations established by treaty. An agreement involving private corporations, private individuals, subnational governments, non-governmental organisations, etc, generally isn't going to be legally binding under international law, even if it also includes national governments among its parties. Occasionally, dependent territories are granted power by the national government to sign legally binding international treaties on certain topics (such as Hong Kong and Macau), but that is an exception to the general rule. There are grey areas which lawyers and scholars will debate, but it rarely turns into a live issue in practice.

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rayiner 5y ago

Your analogy is flawed because you seem to be assuming that the people with execution authority are the ones who reached an agreement in principle. You’d expect them to succeed in papering it up. That’s not the case here. The agreement in principle was reached by someone who has no power to do anything with regards to corporate taxes. Congress sets U.S. tax law and agrees to treaties. To do that, you need 60% or 66% of the Senate. It’s like the CFOs reaching an “agreement in principle” to something that requires Board approval—and a big chunk of the Board is hostile to management.

lukeschlather 5y ago
> The agreement in principle was reached by someone who has no power to do anything with regards to corporate taxes I think you are considerably understating the power of the G7 finance ministers including the US Secretary of the Treasury. Sure, they can't ratify a treaty without the cooperation of congress. They're still extraordinarily powerful individuals and have loads of direct authority to shape tax policy.
- kortilla 5y ago
  They can certainly shape implementation details not defined by laws, but they can’t create laws or change existing ones.
ncallaway 5y ago
My analogy is really just a reference to what "reached a deal" colloquially means. "reached a deal" doesn't mean the deal absolutely 100% will be implemented. It means, the referenced parties have reached an agreement to something. In this case, the leaders of the G7 countries have reached an agreement among themselves to have a minimum corporate tax rate. Note that the United States has no obligation according to this deal—only Joe Biden has agreed the deal. And Joe Biden has no legal obligation under the deal, he merely has a reputational one. Since the agreed minimum corporate tax rate is 15%, and the United States corporate tax rate is 21% there's literally nothing Joe Biden needs to do in order to meet the terms of the deal he made with the other G7 leaders. If they want to turn this into an international treaty, absolutely, GOP Senate votes will be needed (though, given that the treaty would create a floor that's 6 percentage points below our current tax rate, I would imagine those would be attainable votes—if the GOP created a global floor that was lower than our tax rate, they could use it to argue for lowering our corporate tax rate).