A Coca Cola executive once told me that he had
to throw an underling out of his office. Why? The guy attempted to
ingratiate himself by proposing that Coke pump up the bottom line
big-time with accounting practices that would locate profits
off-shore, beyond the reach of the IRS. If your fondness for money
exceeds your sense of civic responsibility, as say, in the case of
our illegitimate president-elect, you would not throw this person out
but rather promote them.
The New York Review of Books has a two-part
examination (10/27, 11/10/16) by Alan Rusbridger of the whistleblower
release of what have come to be called The Panama Papers.
Investigative reporters Bastian Obermajer and Frederick Obermaier of
the German newspaper Suddeutsche Zeitung, were contacted by a
disgruntled source somewhere deep in the off-shore world of a
Panamanian law firm called Mossfon. The source was weary of
seeing wealthy people getting away with outrageous behavior. He, or
she, fed the reporters a massive trove of documents that exposed
heads of states, oligarchs, defense contractors, mafia dons,
gamblers, fraudsters, drug and arms dealers, prominent families and
individuals to embarrassing disclosures about their tax avoidance
schemes, money laundering, corporate shells etc; The power of this
class (who else needs financial management experts?), being in the
cat bird's seat when it comes to influencing legislation,
means that much of what they did was perfectly legal. Russian
President Putin was one of these and was quick to point out that it
broke no laws. Also of note, several news organizations the
whistleblower contacted were not interested, probably part of their
knee-jerk shielding of the 1% who of course own the mainstream media.
You want to keep your job you don't investigate the boss. As it
turned out the cache was so overwhelming that the newspaper decided
to share with an international investigative reporter organization.
There's safety in numbers, at least in the nations that have
constitutional protections.
The
Whistleblower was quite accurate in his/her assessment. The tax
burden, especially in the U.S., has shifted from corporations to
workers since the 50s, with a vengeange starting with Reagan. Those
who benefit least from government policies pay the most. Commerz Bank
in Frankfurt, for example, received $18 billion in taxpayer subsidies
during the financial meltdown yet routinely helped German clients
avoid taxes. The preponderance of the Panama Papers concerns clients
of just one firm, Mossfon, of Panama. We can assume other
companies do similar financial management “services” for the
wealthy, allowing them to avoid taxes, law enforcement and vengeful
spouses. 52 of 54 African countries have used Mossfon. Over
$500 billion has fled Africa, twice as much as its debt. In an
accompanying 2,000 word “manifesto”, the leaker claimed their
intent was to expose inequality and how the wealth management
industry had abetted crime, drug dealing and fraud on a truly grand
scale involving trillions of dollars.
The
various experts cited in the article hold little hope for reform. As
the new administration comes into power here we can be sure that this
particular business-as-usual will procede unimpeded, probably with
new vigor. They do suggest that transparency would help, maybe
embarrassing businesses and individuals into paying their share. We
have public lists of who owns property, why not of who possesses
wealth? Taxing corporations based on where their sales occur is
another measure that might recoup some of the lost revenue. If a
corporations's sales are primarily in the U.S. its taxes shouldn't be
based on sales in Bermuda. It isn't just some numbers short on a
balance sheet. Governments can't adequately address inequality,
poverty, disease and starvation when the needed funds are parked
off-shore. Corporations occupy our government so there is
little chance those goals would even arise and even less chance that
corrective measures would see daylight. Since billionaires, again,
own the media, there is little chance the public will even know of
these shenanigans, as opposed to say, Brad Pitt's latest divorce.
Google
(if you use Goodsearch instead of Google, a penny per search goes to
your favorite non-profit) made $13 billion by shifting its profits to
the low-tax haven of Bermuda. Apple funnels profits to the Cayman
Islands to this same end, all perfectly legal. Apple however was hit
with a $13 billion fine when the European Commission ruled that
Ireland's low tax rate amounted to an illegal subsidy. Ireland was
only one stop on a Byzantine money route Apple had designed to reduce
tax obligations. The lack of regulation and secrecy off-shore is the
draw and like the downward spiral of sweatshop wages and work
conditions, banks are subject to competition. The client can just
move on to whomever offers the least tax, regulation and the most
secrecy. The Koch Brothers et al., and Trump-level wealth preaches
non-regulation as if it were a sacred principle blessing us all but
we know, when we remove the blinders, who the beneficiaries actually
are. I mean beneficiary in the sense that any addict benefits
from the object of their addiction though that addiction ultimately
represents dysfunction. When the addiction creates immense suffering,
comes time for an intervention. When the addiction is unsustainable
and leads toward irreparable environmental damage and extinction, it
is time for an alternative. The election of an unapologetic denier of
reality suggests that it might be too late. Perhaps some other planet
in the vast cosmos will succeed in evolving beyond greed and war.
