Pieces of Eight: News Bulletins from the Eighth Federal Reserve District

Banks to Participate in Russian-American Bankers Forum

Seven banks in the Eighth Federal Reserve District will play host to a pair of Russian bankers for three weeks in late July and early August as part of a major initiative to assist Russia in developing its banking and financial system infrastructure. The program is jointly sponsored by the Russian government and the Federal Reserve System.

In all, 116 U.S. banks in 39 states will participate in the program. Their efforts are aimed at assisting the Russians in developing retail banking and payment services, developing an interbank market and a system for large-value, third-party payments, and creating a market for government securities.

Virtually all—about 98 percent—of the Russian visitors have never been to the United States. To ensure that their time here is spent efficiently, the Russians will be matched up with a U.S. bank of similar size and characteristics to their own. District banks participating are: American State Bank, Charleston Arkansas; Bank of Elkins, Elkins, Arkansas; First Exchange Bank, Tiptonville, Tennessee; First State Bank, Union City, Tennessee; Missouri Independent Bank, Jefferson City, Missouri; National Bank of Commerce of Mississippi, Starkville, Mississippi; and National Commerce Bancorp, Memphis, Tennessee.

U.S. Not Harmed by Foreign Value-Added Taxes, Says Economist

The use of value-added taxes by other countries has little effect on U.S. producers' ability to compete in the international marketplace, according to Federal Reserve Bank of St. Louis economist Michael J. Dueker.

"Most of our trading partners charge a value-added tax (VAT) on exports from the United States," says Dueker. "Some say that if the U.S. would enact a similar tax on goods imported from other countries, we'd be on a more level playing field." Proposals to enact some form of VAT have appeared in several tax reform packages in Congress recently.

If foreign VATS do have harmful effects on U.S. competitiveness, says Dueker, countries with the highest VAT rates should have the largest trade surpluses with the United States. No such relationship is evident, however. "In fact," says Dueker, "the two countries with the biggest trade surpluses with the United States—Japan and Canada—have some of the lowest VAT rates in the industrialized world."

For more information, please call 314-444-8809 and request a copy of the June 1993 issue of the St. Louis Fed's National Economic Trends.

Collection of Papers Honors Retired Fed Research Director

During his tenure from 1975 to 1992 as St. Louis Fed research director, Anatol B. (Ted) Balbach led the charge to write rigorous, but readable, articles about the oftentimes controversial issues involving monetary policy. In his honor, the St. Louis Fed has now made available a collection of essays from its 17th annual economic policy conference, "Dimensions of Monetary Policy, Essays in Honor of Anatol B. Balbach." Included in this collection, published as a special issue of the Bank's publication, Review, are works from some of the most prominent researchers in monetary and financial economics, including Robert H. Rasche, W. Lee Hoskins, Harold Demsetz, Carl F. Christ, Allan H. Meltzer and Michael D. Bordo. To obtain your free of copy of this collection, please call 314-444-8809.

Expenditures Per Pupil in Public Elementary and Secondary Schools in 1992