It’s good to be the king | Sunday Observer

It’s good to be the king

10 October, 2021

“The upper class keeps all of the money, pays none of the taxes. The middle class pays all of the taxes, does all of the work. The poor are there just to scare the heck out of the middle class. Keep them showing up at those jobs.” – George Carlin

Recent events unfolding in the international media under the topic “Pandora Papers” may have increased the curiosity of some, anger in some others and the level of motivation of some to become rich and some others even to become better at hiding their wealth.

A massive global investigation, conducted by the International Consortium of Investigative Journalists (ICIJ), consisting of 600 journalists from 150 media outlets in 117 countries, has exposed the ties between some of the richest people and the hidden world of offshore storages of wealth.

Leaking papers

After sifting through nearly three terabytes of data scrutinising more than 11 million documents leaked from nearly a dozen of offshore financial services, the ICIJ published the list containing more than 300 politicians, dozens of celebrities, and sport stars from countries around the world. The list includes people from the richest nations such as USA with a per capita income of US$ 55,000 to Pakistan with a per capita income of US$ 1000. Not to be outdone by any other nation, Sri Lanka has also been able to have a couple of entries on the list. Though there were similar leaks and revelations in the past such as: Offshore Leaks in 2013, Panama Papers in 2016, and Paradise Papers in 2017, Pandora Papers is the largest of the kind to date.

King Abdullah II of Jordan is one of the top wealth hoarders in the list allegedly owning properties worth over hundreds of millions of US$s in the US and UK among other places. Not surprisingly, more than 700 companies with beneficial owners connected to the US were in the list while US citizens had a larger relative presence compared to other nationalities.

The Pandora papers revealed that the Azerbaijani President and his family have secretly been involved in British property deals worth over US$ 500 million including an office building worth US$ 45 million for the President’s 11-year-old son. Some of the NGOs who supposedly are working to eliminate poverty in the world have already started campaigns demanding the governments of some countries to conduct transparent investigations about these allegations over their own politicians.

Those crocodile tears seem to indicate that they didn’t know anything about such activities until these latest revelations and they have a good faith in the governments of those countries to conduct impartial transparent investigations over their own supporters and bring them to justice if found guilty of any wrongdoing.

It is expected that most, if not all, of the people on the list, if challenged in a court of law, will deny that they have done anything illegal, and nobody should lose their sleep over expecting a guilty verdict.

If these wealth hoarders went through all this trouble to pay millions of dollars to offshore finance companies specialising in helping the rich hiding their wealth, it will be very difficult to find anything illegal in the process unless those finance companies are con artists themselves. This is a game much larger than the average person can even imagine in his wildest dreams.

This is trillionaires pretending to be billionaires or billionaires pretending to be millionaires spending millions to hire millionaire lawyers, accountants, bankers, finance companies and security firms and to bribe government officials and politicians in creating documents to make whatever looks illegitimate or illegal, legitimate and legal.

While using offshore entities could be considered as forms of tax evasion according to the legal framework of some countries, it may be the usual practice in others. The most common tax heavens for the wealthy in the world are countries such as: British Virgin Islands, Bermuda, Cayman Islands, Bahamas, Panama, Seychelles, Belize, Cyprus, Luxembourg, Ireland, and Taiwan.

However, states such as South Dakota and Florida provide plenty of opportunities for the wealthy to avoid paying taxes. Since there are a lot of other ways for providers of these sanctuaries to make money through the process, not only these common places but also an increasing number of free ports have entered into the game.

There are seaports and airports around the world providing warehouses for wealthy clients to store their valuables such as antiques and art collections and even stolen goods without having to declare any details and pay any duties and or taxes since they are considered as free trade zones.

Well known secrets

These have all been known facts and some of the information was even available for interested parties to find out. All the information about tax heavens and the offshore financing companies, and teams of experts who would undertake the contract to hide one’s wealth according to one’s preference whether it is through shell companies, under names of other nationals who really do not exist or through family offices and trust funds and charities, were common knowledge among the wealthy circles though it may be news to the rest of the world.

One can always ask the question: In the era of globalization where we talk about global economy, global warming, global environment, global education, and even global pandemics, what is wrong in global wealth hoarding?

Well, the problem is that when the super-rich worldwide are hiding more and more of their wealth and avoid paying fair share of the taxes it will become increasingly difficult to bridge the gap between the rich and poor. Assuming, of course, that the global community is not joking when they say that they are trying to eradicate poverty or reduce the gap between the rich and the poor.

Because, before the gap can be bridged one would need to know what the gap is. If hundreds of thousands of wealth hoarders hide their wealth offshore, it will not be easy even to have an estimate of that gap.

If the world is serious about reducing the inequality between the rich and the poor or eradicating poverty, then the world leaders and global organisations will have to start enforcing the laws irrespective of the wealth or the size of the campaign contribution made by the violators and increasing the transparency in reporting and disclosure.

The global community has to work as a team and agree to clean up the corrupt system at every corner of the world without any selfish motives. Then the biggest question: Is humanity ready to be that good? If the answer is “no” then, even if the entire Pandora’s box is found and all the evil is put back in the box, there will be someone to open it up and let the evil out again.

The writer has served in the higher education sector as an academic over twenty years in the USA and fourteen years in Sri Lanka and he can be contacted at [email protected] )