I knew, of course, that this is done, and I knew, roughly, how; how some of the rich and powerful, as opposed to most of us, manage to pay little or no taxes. (Hear for instance BBC’s “file on 4”, “Dirty Money UK” of 11 October 2015).
The problem is that more often than not, these people (some of the rich and powerful) are able to avoid paying taxes without breaking the law. Hence the fine verbal distinction between tax evasion, which is a criminal act, and tax avoidance, which is not.
They find loopholes. And the loopholes don’t get closed because the greedy bastards (excuse my French) have contacts in important places (or bribed flunkies in various countries’ civil services, including – I have no doubt – our own) and because the tax avoidance schemes are so complex that even the most adamant prosecutors can’t crack them (cf. my post “Speaking of Crime” a while back).
If an honest prosecutor can’t unravel these cases, how is the general public supposed to? So, to my grief, the general public in each country has until now, at least, been mute about the monumental siphoning off of what should have been tax money. While the lower and middle classes pay for the upkeep of their countries – and the penal sanctions for not doing so are very harsh, indeed – some (I really must insist on this some) of the filthy rich do not. No penal sanctions, no public outcry, no nothing.
Mind you, not only tax money! Once you have obtained a secret little series of PO Box companies in distant lands (or more probably, on islands) to which you can divert the proceeds of your business – and why on earth should you bother to do that, unless the purpose is to cheat your compatriots – you can very easily embark on a criminal career in a big way, all the while apearing devout and well-meaning back home.
But now… Oooo, what an exquisite moment I have just enjoyed! In the wake of the monumental release of the “Panama Papers“, I have been watching an Icelandic Prime Minister trying to explain that he was absolutely innocent of cheating the taxman – and besides, he did not know anything about it – and making such a blessed fool of himself that finally his long-suffering countrymen have been vindicated a little bit:
First Iceland was raped by the country’s bankers, bankers’ friends, and bankers’ government flunkies, and the country more or less collapsed in 2008. (The crooked bankers had victims abroad as well, as many Britons will bitterly remember.) Iceland had to accept gigantic loans to pay for the running of the country, a debt that its citizens are paying dearly, to this day. Most of the funds that had been siphoned off by the crooked bankers and their friends have not been recovered. They had been sucked into a great black hole. They had been vamoosed.
Next, Iceland was bamboozled by a political party which had in effect nurtured the crooked coterie that brought the country to its knees. In the run-up to the last election, that party (the so-called Progressive Party) lied so outrageously and effectively to the voters that it actually regained the power it had lost after the collapse. (Democracy definitely has its weaknesses!)
The Progressive Party’s leader has now been undressed and humiliated. For the record I express the futile hope that he and his like stay away from Icelandic politics for ever.
More importantly, in a global perspective, the Panama papers are documentation of what we knew but couldn’t prove: A very considerable part of the planet’s wealth is unaccounted for, stashed away in secret places, vamoosed into black holes.
The Panamanian law firm, Mossack Fonseca is merely one of many that provide similar services to greedy people.
There is no end to easily accessible statistical material illustating how an infinitessimal proportion of the world’s rich owns and earns far more than the vast majority of the rest of all of us humans added together. I will not bore you with such figures, though they are truly quite stark.
Consider, though, that an unknown but undoubtedly enormous proportion of the world’s wealth is not visible to economists, social scientists, financial researchers, etc, and is not subject to tax. An unknown but undoubtedly enormous proportion of the world’s wealth has vanished down a black hole, has been vamoosed.
Can the planet feed all its inhabitants? If not, why?
