Thursday, January 3, 2013

Offshore tax-havens - what they do

According to most reports in the mainstream media, Offshore tax-havens siphon off trillions of dollars every year that high-tax nations would otherwise spend on health care, education and sorely needed infrastructure. Also, as a sideline, the tax-havens launder money for crooks. Their existence is a crime against humanity, and a symbol of how rotten the world of business has become.

Well, yes and no...

The siphoning of the trillions of dollars is partly true, though it is not the tax-havens who do the siphoning; they are merely passive go-betweens. Much of the siphoned money is not destined for the legitimate benefit of taxpayers, but for unnecessary invasions and occupations of faraway places. Those actions really are a crime against humanity. If the criminal warmakers would stop doing them, they would have the extra trillions to spend on health, education and sorely needed infrastructure.

It’s a sad fact of life that most high-tax nations are controlled by people whose self-interest mocks all notions of decency. Arguably, the less money left in their hands, the more humane place the world would be. As it is, their budgets provide for the destruction of health, education and infrastructure in the Middle East. And/or in Black Africa, which is being mooted as the next victim of the NATO military machine.

More millions of lives will be ended, and more trillions of dollars will be diverted away from the provision of health care, education and sorely needed infrastructure at home, into the bank accounts of the wanton destroyers of the quality of life in other countries. Most of the money will be channelled through Offshore tax-havens, yes, but always with the full knowledge and consent of the rulers of the high-tax nations and their tax-collectors.

The tax-collectors (IRS, Internal Revenue and the like) and their political masters know exactly how much is going to which tax-havens and for what purpose. After all, it’s the legislators who write the laws, and the tax-collectors who write the regulations. How could they not know?

It’s partly true, too, that Offshore tax-havens launder money for crooks. Actually, the havens facilitate the transfer of moneys for anybody who asks, pretty much. It’s impossible for the local facilitators to know which money belongs to crooks and which belongs to legitimate trading companies. Both those categories are advised by lawyers, accountants and banks that are licensed in high-tax nations. After all, wire-transfers aren’t accompanied by memos that say “This money is the property of the Mafia. Don’t mix it up with Exxon’s.” Be reasonable.

Transfers do include money belonging to criminals not approved by the rulers of the high-tax nations. Some of it belongs to drug-smuggling gangs who are actually in competition with gangs protected by the CIA and other official agencies. That’s pretty cheeky, eh?

Is the existence of Offshore tax-havens a crime against humanity? Well, only to the degree that all international trade is, and the licensing of international trading companies’ lawyers, accountants and banks is. Many properly licensed international trading companies are involved in serious crime, you know – far more serious than petty tax-dodging. Think of Blackwater, Halliburton, and all the other destroyers of lives and infrastructure in the world, and the banks that finance them, and the politicians and retired generals who work for them.

Last question: What happens to the trillions of dollars sent to the tax-havens? One never reads or hears about that. In fact, none of it stays here, except for a miniscule percentage taken as fees by facilitators. Why would it stay here? Our local economies couldn’t possibly find a use for it; Cayman’s GDP is less than a billion dollars, for goodness sake. Rather, it is invested by its owners in ever more inventory, to be traded for ever more profits. Round and round and round it goes.

All the high-tax nations' senior politicians and tax-collectors know about it.