Gigantic journalistic investigation into tax havens
by Kenneth Thomas
Gigantic journalistic investigation into tax havens
While Mitt Romney may be fading from view in the wake of his defeat on November 6, the issue of tax havens is definitely not following suit.
Via the Tax Justice Network, I’ve just learned of a massive, multi-national joint investigation into secrecy jurisdictions by three very heavy hitters, the Guardian, BBC Panorama, and the U.S.-based International Consortium of Investigative Journalists (ICIJ). Though they are starting out with the United Kingdom and the seriously understudied situation in the British Virgin Islands, ICIJ has announced that this is just the start of a multi-year investigative project and that there are “many more countries to come in the next 12 months.” Further, according to ICIJ, the investigation involves literally “dozens of jurisdictions and in collaboration with dozens of media partners and freelance journalists around the world” (emphasis in original).
As I write this, the first and second articles (Nov. 25 and 26) in the Guardian’s series rank number two and number one in the “most viewed” articles in the last 24 hours. One of the most amazing articles discusses the use of “nominee” directors, people who pretend to be a company or foundation’s directors in order to hide the true ownership from authorities. Incredibly, these nominee directors frequently do not know the companies they are supposedly responsible for; they just know that they are getting paid for the use of their names. Be sure to check out the BBC undercover film linked from this Guardian article.
The tremendous scope of the journalistic investigation begs the question: where is government on this? Part of the answer is that government is way behind the curve. In 1999, the British government claimed to have stamped out a nominee sham colorfully named the “Sark Lark,” for the tiny Channel Island of Sark where the nominees lived. However, it turns out that the perpetrators of the Sark Lark have simply moved all over the world to continue their scam; the BBC caught up with one former Sark resident in Mauritius.
The other part of the answer is that much of these activities are, in the immortal title of David Cay Johnston’s book, “perfectly legal.” It appears that in many cases governments do not make the effort to sift the illegal from the legal activities.
But let’s not forget: tax havens cost the middle class worldwide hundreds of billions of dollars in tax revenue that they have to make up. The evidence is mounting that they are a central piece of the world financial system. Fundamental reform is necessary and a massive journalistic effort like this one will help produce the outrage to make it possible. I’m looking forward to more fruits of this investigation.
cross posted with Middle Class Political Economist
And yet, for me to pay my blind American mother’s utility bills via online banking from across the border in Canada was prohibited because I Might Be a Terrierist (I.e. a dangerous foreign dog breeder.)
Noni
It doesn’t beg the question it raises the question.
It would be a home run for Democrats like Alan Grayson, or Independents like Bernie Sanders, if they were to introduce a bill called the “Entitlement Reform Act of 2013,” which could bring in the $1.5 trillion in corporate profits booked offshore but held in American banks and tax a third of it, and institute a $0.03 sales tax on risky Wall Street trading like the kind done in the derivatives and mortgage-backed securities markets. The first reform would bring be a $500 billion revenue boost over a ten-year period, the second would bring in between $350 billion and $1.5 trillion in a decade. And the best part would be that both of those reforms would only affect the top 1% of the top 2%, while simultaneously providing enough money to both shore up the deficit and create new jobs.
http://readersupportednews.org/opinion2/277-75/14798-focus-why-democrats-should-embrace-qentitlement-reform
@Steve Roth: quite right. Welcome to the never ending battle for “beg the question” and while we’re at it, “comprise.”
Dang, what do they teach the kids these days! Not a petitio elenchi in sight … He’ll, hand basket, you know the routine.
“….multi-national joint investigation into secrecy jurisdictions by three very heavy hitters, the Guardian, BBC Panorama, and the U.S.-based International Consortium of Investigative Journalists (ICIJ).”
So what does that part of the statement tell us about our MSM? What is the NY Times looking into? And WaPo? “All the news that’s fit to print,” except for the economic details that would be truly informative.
@Steve: Drat! Thanks.
@Rdan, sign me up for it!
@Jack, at least the NYT did a 10-month study of state and local subsidies (one of my main research areas) that started 12/2.
@kenneth Thomas. True enough that in spite of management their journalist staff is often more journo than the average MSM scribe. I especially like g. Morgenstern and they are running the series on tax subsidies to business, but they still give voice to crap from Brooks and Douthat. And Keller in his new role as op ed writer, is as firm on an issue as quick sand.