[HN Gopher] Pandora papers: biggest leak of offshore data expose...
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Pandora papers: biggest leak of offshore data exposes financial
secrets of rich
Author : pseudolus
Score : 762 points
Date : 2021-10-03 16:35 UTC (6 hours ago)
(HTM) web link (www.theguardian.com)
(TXT) w3m dump (www.theguardian.com)
| bloqs wrote:
| Possibly brave opinion. Being rich and obeying the law is not
| morally wrong. Deliberately absconding from your responsibilities
| is.
|
| People do not deserve to be doxxed for simply being rich. All of
| the high school socialists need to focus more on honesty and
| consistency if you wish to criticise others for it. If the system
| needs more transparency then that is what you need to put your
| energy into, not vigilante justice.
|
| If you really believe privacy is a universal right then dox
| people that have more money than you, you are as broken as thing
| you purportedly attack.
| klyrs wrote:
| "High school socialists" is unnecessary sneering at the
| community. I suspect you could express these opinions without
| such flamebait.
| craigr1972 wrote:
| I want to know who exactly did this, on whose instructions, and
| why right now.
| [deleted]
| loufe wrote:
| @dang could this and the other trending story from ICIJ be
| merged?
| throwawayay02 wrote:
| The world needs more wikileaks and less ICIJs.
| wolverine876 wrote:
| Why? ICIJ did the work here.
| m00dy wrote:
| I would like to download these files if possible.
| EGreg wrote:
| Can someone summarize the main strategies we should be aware of?
| Which ones can help the plebes?
| fallingknife wrote:
| None, of course. If any of these loopholes could be used by a
| significant fraction of the population, they would quickly be
| closed.
| esarbe wrote:
| And isn't that exactly thing that makes this 'unfair'? If
| this was a way that everyone could use to lower their taxes,
| I would have no issue with such practices.
|
| But - as you rightly point out - if that was the case, these
| loopholes would be closed first thing in the morning. These
| are loopholes created by the extensive lobbying of an
| exclusive club of people that do not want this to be
| available for the common plebs, but exclusive to the rich
| boys (and gals) club.
| loufe wrote:
| Couldn't it just be a matter of scale? In order for the tax
| savings to outweigh the expensive consultant and account
| fees, you'd likely have to have a large sum of money to hide.
| ashtonkem wrote:
| Yes, that is usually the barrier to entry. My go to example
| is how the Bezos of the world fund their lifestyles by
| taking out low interest loans backed by their stocks. The
| loans are rolled forward continually and only paid off once
| they die. This avoids capital gains, which is higher than
| the loan interest. This technique is legal for anyone, but
| good luck convincing Goldman Sachs to loan you money based
| on 0.001% of Facebook's outstanding shares.
|
| GP's argument, I believe, is that if these techniques were
| usable by you and I they'd close the loop holes quickly.
| The reason why they're not usable by the plebs is
| immaterial to the basic point. Tax code is very much a
| "rules for thee and not for me" area of the law.
| fallingknife wrote:
| This is correct, but just wanted to point out that 0.001%
| of FB is worth about $10 million, so you could definitely
| get a loan on that.
| ashtonkem wrote:
| Ah, I knew I'd regret just making up a percentage that
| felt small enough. Oh well
| gunshai wrote:
| What is interesting is you can do this really easily in
| the crypto environment. There are plenty of services that
| are offering the ability to borrow against your gains to
| avoid capital gains.
| e1g wrote:
| You're directionally correct, but the threshold is lower.
| In the US, banks will give you a low-interest loan for up
| to 50% of your holdings with them (public equities,
| etc.), starting at $300k. Having $600k+ in liquid
| investments is unquestionably above middle class, but
| this strategy is well within reach for many tech people.
| gruez wrote:
| Depending on what you mean by "low-interest". At IBKR you
| only need $100k to get 1.06% interest rate.
| https://www.interactivebrokers.com/en/index.php?f=46376
| GDC7 wrote:
| But that's for margin. Meaning you use the funds to
| trade.
|
| It's different than taking a loan against 300k USD in FB
| shares, because that you can use for everything...ranging
| from buying a Ferrari to starting a new business.
|
| Interest rates will naturally be higher.
| gruez wrote:
| > But that's for margin. Meaning you use the funds to
| trade.
|
| nope, you can withdraw it.
| https://www.mrmoneymustache.com/2021/01/29/margin-loan-
| ibkr-...
|
| Also, there's nothing functionally different between:
|
| 1. having 500k in stocks and borrowing $250k from it
|
| 2. having 500k in stocks, selling half of that to get
| $250k, withdrawing $250k, then rebuying $250k worth of
| the stocks using margin
| GDC7 wrote:
| > nope, you can withdraw it.
| https://www.mrmoneymustache.com/2021/01/29/margin-loan-
| ibkr-...
|
| Is that intentional from IKBR? I guess if they knew
| they'd raise their interest rate. If people start using
| this method more and more then it will disappear. Seen
| this pattern over and over again in many fields.
|
| > having 500k in stocks, selling half of that to get
| $250k, withdrawing $250k, then rebuying $250k worth of
| the stocks using margin
|
| Risking money in the financial markets vs. risking them
| (or again using them) in the real markets are 2 very
| different things.
|
| There is no equivalent for the SP500 in real life, also
| real life is very illiquid compared to financial markets.
|
| Plus unless you are very wealthy financial institutions
| tend to look down on people who want to spend money or
| have the arrogance to think they can start a business,
| they always punish such behaviors with higher interest
| rates.
|
| Also once the money is out of the trading platform and
| into your checking account you could buy real bitcoin on
| Coinbase, withdraw to private wallet, flee to South
| America and never be heard from ever again
| gruez wrote:
| >Is that intentional from IKBR? I guess if they knew
| they'd raise their interest rate. If people start using
| this method more and more then it will disappear. Seen
| this pattern over and over again in many fields.
|
| if you search around this method has been around for a
| while, so it's not some sort of glitch. Plus like I said
| earlier, it's not any different than using the money to
| buy stocks.
|
| >Also once the money is out of the trading platform and
| into your checking account you could buy real bitcoin on
| Coinbase, withdraw to private wallet, flee to South
| America and never be heard from ever again
|
| I don't think you understand how this works. They still
| have your stocks. If you flee to south america they don't
| really care. Should you fail to meet your maintenance
| margin your stocks will be liquidated to pay back the
| loan.
|
| >Plus unless you are very wealthy financial institutions
| tend to look down on people who want to spend money or
| have the arrogance to think they can start a business,
| they always punish such behaviors with higher interest
| rates.
|
| I think you're ascribing ill will where there isn't any.
| Banks charge high interest to business and/or personal
| loans not because they hate poor people or whatever, but
| because they're risky.
| GDC7 wrote:
| > I think you're ascribing ill will where there isn't
| any. Banks charge high interest to business and/or
| personal loans not because they hate poor people or
| whatever, but because they're risky.
|
| I don't mean to accuse bankers, if anything I meant to
| stress that this method has something which doesn't add
| up .
|
| Think about it , even if your net worth is 1M you still
| have to go through a conversation with the bank before
| they loan you money. They want to know your intentions,
| what are you going to do with it and so forth. They size
| you up, and the 1M net worth doesn't even count as a tool
| to reduce the burden of questions.
|
| This method instead : you post some securities and you
| get a loan with no questions asked. It seems too good to
| be true or intentional from the financial institution
| side as it completely sidesteps the due diligence
| process.
| gruez wrote:
| >This method instead : you post some securities and you
| get a loan with no questions asked. It seems too good to
| be true or intentional from the financial institution
| side as it completely sidesteps the due diligence
| process.
|
| It's not any different than going to a pawn shop and
| getting a loan, no questions asked. They don't ask any
| questions (aside from any mandatory AML/KYC ones) because
| they don't need to. The combination of easy to
| sell/liquid stock and the margin requirement makes it
| very unlikely that they'll lose their money. If you have
| $100k worth of stocks, SEC/FINRA regulations means that
| you can borrow up to $50k, and your portfolio can drop
| another $25k before they start liquidating your holdings.
| At that point you still have $75k worth of collateral for
| $50k worth of loans, so the chances of them losing money
| is slim.
| vmception wrote:
| Anyone can get a loan against securities. That isnt
| special.
|
| Collateralized lending is very common such that its not
| newsworthy.
| gruez wrote:
| >The loans are rolled forward continually and only paid
| off once they die. This avoids capital gains, which is
| higher than the loan interest.
|
| 1. Does this actually work? AFAIK you avoid capital
| gains, but at the same time you need to pay estate taxes.
|
| 2. According to wikipedia bezos is 57 years old. Using
| the figures from SSA[1], he still has 26 years to live.
| The 20 year treasury rate (ie. risk free rate) is 1.99%
| (annualized). Applying that rate over 26 years gets you
| 66.9%. That doesn't seem like much of a savings over the
| long term capital gains rate of 20%. The numbers make
| more sense if you use 3 or 5 year treasuries, but that
| also exposes you to interest rate risk in the future.
|
| [1] https://www.ssa.gov/oact/STATS/table4c6.html
|
| >This technique is legal for anyone, but good luck
| convincing Goldman Sachs to loan you money based on
| 0.001% of Facebook's outstanding shares.
|
| They'll happily loan you money based on the equity in
| your home though.
| https://en.wikipedia.org/wiki/Reverse_mortgage
| ashtonkem wrote:
| Yes, it works. The tldr is that the cash you avoid paying
| capital gains on remains invested and growing.
|
| https://www.bloomberg.com/news/newsletters/2021-07-26/mon
| ey-...
| gruez wrote:
| That's talking about something totally different. The
| parent poster is talking about the tax implications (the
| gains aren't taxed), whereas you and the article you
| linked is talking about the potential upside because
| you're effectively borrowing money to invest.
| ashtonkem wrote:
| I'm the GP... I guarantee you I was talking about the
| same thing both times.
| gruez wrote:
| whoops, my bad. For some reason I thought you were
| talking about "capital gains [taxes]".
| tejohnso wrote:
| Wouldn't the estate have to sell shares to cover the loan
| upon death? Or transfer shares directly, but pay the
| capital gains as though it were a sell + transfer
| transaction?
| [deleted]
| manquer wrote:
| A lot of negative comments that this is yet another leak and
| nothing is going to change.
|
| I see a lot of positives,
|
| Panama and paradise leaks were from one firm, this is from 14
| different ones and by far the largest one in terms of number of
| documents, that's progress.
|
| More transparency is always good , as an immediate impact asset
| owners like the British crown are now going to be lot more
| careful who they are buying from, the optics of enabling
| laundring is quite important for such buyers.
|
| Removing such buyers from the market for dictators will limit who
| they can deal with making it more difficult and likely less
| lucrative for them in dealing with property
| nofrills wrote:
| Rothschild, Rockefeller, Warburg, Zuck, Musk, Bezos on the list?
| Oops, no? Then you know its entertainment.
| harikb wrote:
| I read 3/4th of the article and the title entirely as "Panama
| Papers" and wondered why the 2013 news is still being discussed
| until I realized....
| BrandoElFollito wrote:
| Well, I read Panama Papers until your comment...
|
| I just read the comments, though, and somehow nothing seemed
| strange, I just thought some more information emerged after a
| few years.
| TechBro8615 wrote:
| The website is unreadable on mobile.
| klyrs wrote:
| Reader mode fixed that for me
| EarlKing wrote:
| Link currently returning 502 Bad Gateway. Probably should've
| wrapped this in an archive.is link.
| Melting_Harps wrote:
| Done: https://t.co/JxKKwYqrtt?amp=1
| justinclift wrote:
| Nope, that just directs to the original article rather than a
| snapshot saved for posterity.
| au8er wrote:
| I guess just like the Panama papers, leading journalists will be
| killed, investigations stop being reported in mainstream media,
| and the world goes quiet again with nothing changing.
| 627467 wrote:
| "leading journalist will be killed"? Who? Panama papers did the
| round for weeks/months in the media around the world.
| j-pb wrote:
| > who?
|
| https://en.m.wikipedia.org/wiki/Daphne_Caruana_Galizia
| alexgmcm wrote:
| And the Paradise Papers as well.. but who knows - third time
| lucky?
| edoceo wrote:
| Paradise Papers? I missed those, 2017 I guess.
|
| https://www.icij.org/investigations/paradise-papers/
| [deleted]
| [deleted]
| dvdkon wrote:
| Well hopefully it'll show a few more people that our current PM
| Babis isn't the anti-corruption people-lover he paints himself
| to be. Election's next week, so no time for investigations to
| fade away.
| 74d-fe6-2c6 wrote:
| Journalists got killed over reporting about and investigating
| the Panama Papers?
|
| I guess you are referring to Daphne Caruana Galizia. That would
| still be singular, though.
| sofixa wrote:
| There were politicians in Iceland, Spain, Ukraine who resigned.
| There were multiple criminal investigations, and convictions.
|
| There were no earth shattering mass arrests and government
| topplings, but it's unrealistic to expect such a thing.
| kzrdude wrote:
| And the current US president has mentioned international tax
| treaties as an issue he wants progress on.
| nuclearnice3 wrote:
| And PM of Pakistan Nawaz Sharif was disqualified from
| office. https://en.wikipedia.org/wiki/Panama_Papers_case
| Hokusai wrote:
| Things happened: https://www.icij.org/investigations/panama-
| papers/five-years...
|
| E.g. In Denmark, the country's tax minister cited the Panama
| Papers to justify hiring hundreds of new employees to bolster
| the fight against tax fraud.
|
| It was high news and had consequences. There is much work to be
| done, but 'nothing changing' is not the case.
| hermitcrab wrote:
| I don't understand the greed of these people. Once you have
| health care, education, a nice house, a nice car and you can
| afford to go on holiday, what else do you need?
|
| What is the point of having 10 super cars or a 100 room mansion?
| Showing off to other shallow people?
| amelius wrote:
| Building a huge render farm would come to my mind, but I'm not
| a billionaire.
| archsurface wrote:
| Aspiring to be monarchy, which condones "sacred people" above
| all others.
| loufe wrote:
| So long as wages for top politicians remain not top CEO-level
| (IMO causing corruption to make up for difficulty and investment
| made in getting into power) and countries compete in a race to
| the bottom for taxes and secrecy (which allows for such a system
| to exist) I really don't see the end of the offshore phenomenon.
| We really need to push our leaders to action on this issue. The
| global minimum tax initiative and corruption drives are a start.
| In my fantasy all-powerful yet noble leader of a country I'd go
| so far as embargos on nations and sanctions on wealthy
| individuals to discourage this tax cheating, alas. Shame on tax
| cheaters, you're stealing from your neighbours.
| TomSwirly wrote:
| Has it occured to you that trying to find leaders on the basis
| of greed might be a reason that things aren't going so well?
|
| Maybe we should be paying politicians less and having a cap on
| their net wealth instead.
|
| And before you say anything - there are plenty of very very
| competent people who would do the job, just not the rich.
| pessimizer wrote:
| > So long as wages for top politicians remain not top CEO-level
|
| Remember, of course, that there are two ways to fix this.
| loufe wrote:
| I see what you mean. I wonder if while cutting CEO pay if
| we're cutting into meritocracy as a path to financial success
| and just further enlarging the slice of the pie for existing
| holders of capital. Right? I understand that wages are
| obscene but at least they're wages paid to people actively
| working. Holders of capital have a job to play as well as
| they seek the best place to invest it, but I feel like
| capitalism isn't stretching well to the 21st century canvas.
| mplewis wrote:
| What?
| namdnay wrote:
| Having a CEO-level salary didn't stop Ghosn from cheating
| baybal2 wrote:
| Somebody very big keeps going, hacking those offshore law firms
| for years in a row.
|
| This cannot be just leaks keeping consistently popping up like
| that.
|
| I am trying to guess whose doing it may be?
| LudwigNagasena wrote:
| Third time's a charm? Or nothing is going to happen again?
| marcodiego wrote:
| ELI5 please
| mplewis wrote:
| Here's a link to an article which is a tidy summary of what the
| Pandora Papers are:
|
| https://www.theguardian.com/news/2021/oct/03/pandora-papers-...
| Vinnl wrote:
| Anyone know what kind of source has such documents from 14
| different companies spread across jurisdictions?
| xyzelement wrote:
| On superficial reading, this story conflates tax minimization
| with cases of corruption.
|
| Corruption means a politician becoming wealthy in an
| inappropriate way from their position of power. Even if they were
| to pay taxes this is still a huge negative for society. Wherhers
| it's the president of Azerbaijan or Nancy Pelosi, it's should
| rise to the level of criminal enrichment if properly
| investigated.
|
| On the flip side are people who made their money legitimately and
| employ legal strategies available to them to minimize their tax
| bill. I have a hard time moralizing this because we all do it. Be
| it writing off donations, using tax loss harvesting, holding on
| to investments just long enough to not trigger capital gains
| taxes, etc - we all use strategies available to us to pay no more
| tax that we have to. I would expect nothing else from a more
| wealthy person. I would be totally fine if society made moves to
| close loopholes but I can't blame people for leveraging loopholes
| that exist because we should all do that.
| esarbe wrote:
| > I would be totally fine if society made moves to close
| loopholes but I can't blame people for leveraging loopholes
| that exist because we should all do that.
|
| You can still blame for bribing politicians to create these
| loopholes in the first place.
| crispyambulance wrote:
| > I would be totally fine if society made moves to close
| loopholes but I can't blame people for leveraging loopholes..
|
| The first step in the right direction, then, is for people to
| become aware of these highly unsavory (but legal) practices.
| It's not going to be an easy fight. The kind of people that
| setup multiple shell companies to obfuscate the ownership of
| their assets have worked deliberately to extract wealth and
| game the system to a level that is unimaginable (at least for
| me before I heard about the related Panama Papers story that
| broke a couple years ago).
|
| Ultimately, as we approach a global society with insane levels
| of wealth inequality and where public infrastructure and social
| safety nets have started to come apart at the seams, it's
| imperative that these "loopholes" get closed. Otherwise, we're
| going to be revisiting Feudalism in 21st century western
| democracies. Sadly some people seem to want that. They see it
| as a kind of gilded age lords and their servants.
| esarbe wrote:
| > They see it as a kind of gilded age lords and their
| servants.
|
| The vexing thing is that everyone thinks that they are going
| to end up on the "lord" side of this duality. I think this is
| the biggest lie of the 20th and 21th century; that this game
| is in any way, shape or form a fair one. The game is rigged
| and while everyone seems to recognize this on some level,
| almost everyone is trying to keep it rigged in the delusion
| that they be the masters one day.
|
| The fools.
| whakim wrote:
| Meritocracy is a giant myth (often completely unconnected
| to the underlying data), but it's important to recognize
| that it's just the latest in a long line of myths that have
| been told to justify inequality. For centuries, the wealth
| of the nobility and the clergy vis-a-vis the third estate
| was justified by appealing to the harmony of a tripartite
| society. In the ownership societies of the 19th century,
| inequality was often justified by pointing to the various
| rules and laws that governed and sacralized property rights
| (which were theoretically available to anyone) upon which
| stability and good governance depended.
| archsurface wrote:
| Some of those wealthy people are so-called "royals" - paid by
| tax-payers.
| vmception wrote:
| These stories always do that as it fulfills a fetish.
|
| But in any case, would your opinion change if the tax resident
| or provider wrote the tax law that got passed? In Mossack
| Fonsaco's case that is what they did in a variety of island
| nations.
| xyzelement wrote:
| I am not very familiar with this but on the surface what you
| describes sounds like corruption to me so yes very much
| against that.
| whakim wrote:
| While I see what you're saying, I don't think that I completely
| agree with you because the wealthy using these techniques (
| _especially_ if they are politicians, but even if not) are
| undermining public confidence in the tax regime. If Nancy
| Pelosi or the President of Azerbaijan are conducting their own
| affairs in one way while advocating for something else, why
| should I believe their supposed commitments to a socially
| equitable taxation regime or desire to make the world a better
| place?
| rcMgD2BwE72F wrote:
| >On superficial reading, this story conflates tax minimization
| with cases of corruption.
|
| Yes but many of the tax loopholes are just the result of the
| corruption of power (legal or not). It's only obvious to the
| people who benefit from it, so no one bats an eye.
| Zigurd wrote:
| As others on this thread have pointed out, tax laws generally
| outlaw sham loans, licensing arrangements, etc. When that kind
| of cleverness works, it usually needs a boost from corruption
| since the tax laws already exclude it.
| I_am_tiberius wrote:
| I don't understand why they release names of people who they also
| say did not do anything wrong.
| jedberg wrote:
| The thing with all of these is that the rich people are probably
| just as surprised as you are to show up in these leaks in most
| cases.
|
| When you get barely rich, like single digit millions, the banks
| will start to offer you "family office" services. They basically
| just take care of everything for you. You send them all your
| money and all your debts (even your phone bills and stuff), and
| they promise to make sure there is more at the end of the year
| than the start. They invest for you, they do accounting and file
| taxes for you. You give them limited power of attorney so you
| don't even see the tax forms.
|
| If you ask how it all works, they tell you it's really
| complicated and you should just focus on doing whatever it is
| that made you rich and let them worry about managing the money
| for you. Sometimes they do ethical stuff, sometimes not,
| depending on which bank and which consultant you hire.
|
| I'm not excusing the people who are here, just explaining how
| some people who you thought were good people end up in these
| leaks.
| jplr8922 wrote:
| I like the way you view it. A lot of non-rich people do not
| feel responsible at all for their wealth management. Some get
| lucky, and are very happy using their extra money to pay people
| to keep not thinking about this.
| cblconfederate wrote:
| I doubt there are such people, they know at least nominally.
| The thing is, it is not illegal, so unless you re an active
| politician it doesnt register as something materially unethical
| LeoPanthera wrote:
| Alternative coverage.
|
| https://www.bbc.com/news/world-58780465
|
| https://www.theguardian.com/news/2021/oct/03/pandora-papers-...
|
| https://www.washingtonpost.com/business/2021/10/03/takeaways...
| 1vuio0pswjnm7 wrote:
| This touches on something that HN readers should be quite
| familiar with. The immediate issue here in every case is not
| legality, ethics, morality, etc., it is _privacy_.
|
| As we can see demonstrated by this story, some folks do have
| things they want to hide. Tech employees supporting efforts to
| violate people's privacy at mass scale, collecting data about
| people to feed advertising-dependent business plans, and
| creating conditions for data breaches that leak personal
| information, please take note.
| miohtama wrote:
| It is always about balancing public, the interest of many,
| over private, the interest of one. When transaction size goes
| to millions and publicly funded politicians get involved, the
| public interest becomes more dominant. Especially if you have
| crooked deals like a friend of Putin buying a movie theater
| price under the market value, funded by a government loan.
| verisimi wrote:
| I'm cynical, but I think if the bbc, guardian and wapo are
| reporting on this, this is a controlled release.
| say_it_as_it_is wrote:
| The only people who will be punished by this leak are journalists
| and anyone remotely close to making a fuss about the corruption
| jrexilius wrote:
| Hmm.. the article reads more like biased, sensationalism than
| unearthing some grand cosnpiracy. If there are some actual crimes
| mixed up in this they undercut the importance of those with
| foaming-at-the-mouth hype bits like "billionaire owns a $22mil
| home in france".. Are they saying it was purchased with tax payer
| money? or bribes? That is just one exmaple of the overwrought
| nature of the piece. I think they do justice a disservice by
| trying to imply (without explicitly calling _or_ substantiating)
| wrong-doing everywhere there may be wealth. Focus on the actual
| crimes..
| cblconfederate wrote:
| Yup, nothing to see here, taxes are for losers
| joshuahaglund wrote:
| It's really long but did you read even half of it? Because:
|
| _Czech Prime Minister Andrej Babis, one of his country's
| richest men, rose to power promising to crack down on tax
| evasion and corruption. In 2011, as he became more involved in
| politics, Babis told voters that he wanted to create a country
| "where entrepreneurs will do business and will be happy to pay
| taxes."_
|
| _The leaked records show that, in 2009, Babis injected $22
| million into a string of shell companies to buy a sprawling
| property, known as Chateau Bigaud, in a hilltop village in
| Mougins, France, near Cannes._
|
| _Babis has not disclosed the shell companies and the chateau
| in the asset declarations he's required to file as a public
| official, according to documents obtained by ICIJ's Czech
| partner, Investigace.cz. In 2018, a real estate conglomerate
| indirectly owned by Babis quietly bought the Monaco company
| that owned the chateau._
|
| Sounds like at the very lest it was unreported. We have half
| the story, which in a lot of cases sounds like fraud. The other
| half of the story is in tax documents.
|
| ETA: The other thing is a lot of these people have the power to
| fix these systems that enable corruption, and like Babis,
| publicly say they will. But are they going to fix the system if
| they're using it?
| A4ET8a8uTh0 wrote:
| It is interesting since recent OFAC enforcement was against
| crypto exchange in Czech republic and I did have some other
| indications of CZ becoming an interesting nexus for otherwise
| unsavory or questionable activities ( from US perspective
| anyway ).
| doublerebel wrote:
| The Guardian article does read like sensationalism and is
| suspiciously devoid of actual crimes. On the other hand, this
| full report direct from the ICIJ is much more damning and
| relates each leader's tax evasion directly with the poor
| conditions faced by their citizens.
|
| > "If the Jordanian monarch were to display his wealth more
| publicly, it wouldn't only antagonize his people, it would piss
| off Western donors who have given him money,"
|
| ...
|
| > Marwan Kheireddine, Lebanon's former minister of state and
| the chairman of Al Mawarid Bank, also appears in the secret
| files. In 2019, he scolded former parliamentary colleagues for
| inaction amid a dire economic crisis. Half the population was
| living in poverty, struggling to find food as grocers and
| bakeries closed.
|
| > "There is tax evasion and the government needs to address
| that," Kheireddine said.
|
| > That same year, the Pandora Papers reveal, Kheireddine signed
| documents as owner of a BVI company that owns a $2 million
| yacht.
|
| > Al Mawarid Bank was one of many in the country that
| restricted customers' U.S. dollar withdrawals to stem economic
| panic.
|
| > Wafaa Abou Hamdan, a 57-year-old widow, is among the regular
| Lebanese who remain angry at their country's elites. Because of
| runaway inflation, her life savings plummeted from the
| equivalent of $60,000 to less than $5,000, she told Daraj, an
| ICIJ media partner.
| Wronnay wrote:
| Normally they don't pay taxes on offshore havens - so what they
| are trying to say is that these leaders and billionaires don't
| pay taxes like us normal ppl.
| splix wrote:
| Before transferring the money to an offshore you earn them,
| which includes paying all of the taxes, like normal ppl.
|
| When you get money from the offshore (as dividends or
| whatever) you pay taxes on that income, like normal ppl.
|
| What happens with the money between these moments is
| different story though. Depends on how the money are spent.
| And to my understanding, if they used to buy a property, say
| in US, the offshore still pays the US property taxes.
| inovica wrote:
| In some respects, true, but that isn't always the case.
|
| Say you own a company in the UK which sells widgets, but
| you also own an offshore company that also sells widgets.
| If you are dealing with a Chinese company, you could use
| the offshore company to do the deal, paying little to no
| tax. The money then resides in the offshore company and has
| never gone through the UK - either as a business or
| personal. As an individual you could own a credit card that
| you use to spend in the UK, which goes back to the offshore
| company. In additional, the offshore company could buy
| property in the UK and no tax is paid. There are various
| other tricks and nuances that can be employed to help
| minimise tax paid - completely legally.
| splix wrote:
| I bet it isn't always the case too, right? I actually
| wanted to say that the fact of owning a foreign corp
| doesn't mean anything. It may be used to avoid some
| taxes, or may not.
|
| I can even give opposite examples, like when someone
| comes to the US to run a startup in California. For the
| country of their origin they definitely opened an
| offshore corp (in the US in this case) and don't pay
| taxes on it (they still pay to the US gov though). It's
| just more convenient to have a US corp rather that a corp
| in their home country, and not because of taxes which may
| be higher in the US.
| Melting_Harps wrote:
| > Focus on the actual crimes.
|
| The broader question and sentiment of this piece is: how
| exactly have people who supposedly work in Public Service
| amassed such wealth when these positions are paid so low, and
| what lengths will they go to do so, especially in developing
| countries. The subtext being if their are conflicts of interest
| in their investments which happen to also be tied to offshore
| havens.
|
| This _outrage_ is warranted, because it underscores how tiered
| the legal system is World wide (The US is least represented in
| the Pandora release but 2 Federal Reserve Presidents have just
| stepped down due to insider trading [0]) for those closest to
| power, whereas tax evasion is one of the most effective ways to
| get a criminal indictment for the average citizen in most of
| the World.
|
| 0: https://wgno.com/news/business/dallas-feds-kaplan-to-
| leave-i...
| jrexilius wrote:
| Agree with some of that. It is a concern when an elected
| official, with no other source of income, becomes wealthy in
| office. But their leading bullet point isn't about that. It's
| a billionaire, who _then_ ran for office. It's very clearly
| trying to equate wealth with wrong-doing by association and
| implication, without any specific claims or substantiation.
| And it undercuts the story where it is cases of bribes,
| theft, and corruption.
| jyounker wrote:
| And said billionaire, who ran on a anti-corruption
| platform, concealed assets that are were required by law to
| be disclosed. That's a crime.
| aww_dang wrote:
| For many ideologues, wealth is evidence of crime.
| baybal2 wrote:
| > This outrage is warranted, because it underscores how
| tiered the legal system is World wide (The US is least
| represented in the Pandora release but 2 Federal Reserve
| Presidents have just stepped down due to insider trading [0])
| for those closest to power, whereas tax evasion is one of the
| most effective ways to get a criminal indictment for the
| average citizen in most of the World.
|
| For those closest to the power, the easiest way to get around
| the law... is to follow it to the letter.
|
| Biggest, and most famous Russian mafiosos live in the open in
| London, while diligently paying taxes on their multi-billion
| ill gotten wealth, and without using any offshore structures,
| or shady law firms at all.
|
| And the British establishment, Downing St., is very happy
| with this arrangement.
|
| What people forget about these things is that those offshores
| are a refuge for at most second grade rogue economic players,
| whose main rationale hiding their wealth is to hide it from
| other much bigger gangsters, and mafias from their home
| countries.
|
| They themselves choose places like London not because it's a
| rich city to live in, but because of London offering much
| better protection from being gunned down in broad daylight
| than cities in their home countries.
| bserge wrote:
| > because of London offering much better protection from
| being gunned down in broad daylight than cities in their
| home countries.
|
| Highly doubt it. A targeted assassination would be as easy
| in London as anywhere else.
| Melting_Harps wrote:
| > For those closest to the power, the easiest way to get
| around the law... is to follow it to the letter.
|
| I'd agree but not for the reason(s) you've outlined, what
| they they will do is get their crimes legalized. Or, if
| they get caught as in the case with Christine Lagrade [0],
| they will get convicted but serve no sentence and remain in
| their position. Proving that selective application of the
| Law, nepotism and the failing up method is as prevalent as
| ever within these circles.
|
| The City of London Corporation is nearly autonomous to the
| greater UK with it's own political and legal framework [1],
| and given it's incredibly checkered past, you'd do well to
| keep that in mind when you decide to be an apologist for
| Russian tycoons and oligarchs.
|
| To be clear: I'm not against wealth or the wealthy, I'm
| merely pointing out the hypocrisy (and my disdain) for
| those who use their relation to the State for their own
| largess.
|
| 0: https://www.bbc.com/news/world-europe-38369822 1:
| https://en.wikipedia.org/wiki/City_of_London_Corporation
| thr0wawayf00 wrote:
| > The broader question and sentiment of this piece is: how
| exactly have people who supposedly work in Public Service
| amassed such wealth when these positions are paid so low
|
| Usually, those folks come from money to begin with, which
| makes the situation even worse.
|
| I saw this a lot living down in Texas, state congressional
| pay is so low that you basically have to come from money in
| order to run and hold state office (base pay is $7.2K
| annually and tops out at $40k for a two year period,
| depending on how many days they're in session, basically
| minimum wage). Even though it's technically not a full-time
| job, it's demanding enough of one's time that they need a
| prior career with enough flexibility in order both hold
| office and make extra income, which excludes the vast
| majority of the population.
| tomp wrote:
| A lot of tax avoidance is legal (Tony Blair example: there's
| _stamp duty_ (transaction tax) on real estate in the UK, but no
| stamp duty on transactions involving companies _that own UK
| real estate_ ).
|
| But my prior is, that if the public _knew_ about it (in general
| "these are the ways the elites use to pay less tax than you",
| as well as specifically "this career public official actually
| amassed $100m wealth on $100k salary"), the laws would change
| (e.g. introduction of wealth tax, or equalization of capital
| and labour taxes).
| seibelj wrote:
| Since the beginning of written history there have been taxes and
| there has been corruption. And people respond very strongly to
| financial incentives - notice how people drive out of their way
| to save a few pennies on gas.
|
| Now imagine you have millions or billions of dollars. You do not
| want to hand over 50% of your income to tax authorities,
| especially if a legal way exists not to. And if you make the
| current legal ways illegal, the money will just keep flowing to
| invented ways. There will never be a way to avoid this, unless
| you have a centralized AI super computer that cannot be
| manipulated by fallible humans watching everyone's cash globally
| and enforcing strict rules. And that will never happen.
|
| Most of the Panama Papers revelations were not illegal behavior.
| This article says most of this is perfectly legal. I'm not sure
| what the scandal here is other than humans don't want to give
| half their money away to the government.
| CyanBird wrote:
| > There will never be a way to avoid this
|
| Yeah, there are no perfect solutions to the problem, yet that
| doesn't mean tat our current imperfect solutions don't work to
| deter and reduce it, if anything it shows that these imperfect
| solutions need to be expanded upon, not discarded due their
| inherent human imperfection
| seibelj wrote:
| Rather than playing the same failed whack-a-mole that has
| been attempted since the beginning of civilization, maybe we
| should try and keep taxes low, services more efficient, and
| have alternatives to government-provided services for
| features we want of society. You may feel better when taxes
| are changed / raised but they will fail to do what you
| intend.
| ur-whale wrote:
| > maybe we should try and keep taxes low, services more
| efficient, and have alternatives to government-provided
| services for features we want of society.
|
| Yes, but the army of parasites whose livelihood depend on
| the inefficiencies you describe beg to differ, and do so
| most efficiently.
| at_compile_time wrote:
| Sounds like another argument in favor of a land value tax: it
| can't be avoided by hiding one's wealth overseas.
| fragmede wrote:
| It turns out that the Pandora Papers were released by a
| centralized AI super computer, and is testing humanity to see
| how each individual reacts.
|
| Congratulations! You've been placed on team "no one's allowed
| to complain about things that were bad in the past and also
| things will never get better and plus anyway it's not illegal".
|
| Are you sure that's the team you want to be on (Y/N)?
| bch wrote:
| s/Are you sure that's the team.*/Click to continue./
| paulpauper wrote:
| if people respond to financial incentives they likely will
| respond to other incentives as well. As a hypothetical, making
| tax evasion punishable by death, like in antiquity, would
| probably be a good incentive to comply. The consequences for
| tax evasion are quite mild, in the US and elsewhere. You get
| letters, more letters, maybe a visit, and finally, if you're
| really unlucky or obstinate, a little jail time.
| seibelj wrote:
| Given how terrible bureaucracies are the world over, and how
| many people are jailed innocently, it will be quite sad when
| people are literally murdered by the state for not paying
| their tax bill. And most likely the most popular and famous
| people!
| ur-whale wrote:
| > humans don't want to give half their money away to the
| government.
|
| For a large number of people, this is very clearly a crime.
| mygoodaccount wrote:
| Another leak that will have people "outraged" by aggressively
| upvoting and commenting on articles for two weeks. The news cycle
| will move on, the leakers will be car bombed [0], and these
| papers will be memoryholed.
|
| You can wait around for four years til a new set of old rich
| people get voted into power (maybe they'll be blue/red this
| time!!!!) and hope they get rid of the loopholes they all use.
| Maybe a couple more """revolutionary""" politicians will be
| elected who VERBALLY DISMANTLE AND DESTROY a couple billionaires
| in a senate hearing (OMG SO AWESOME!!!). Decide for yourself if
| you think anything will change.
|
| There does exist a great equalizer, but I won't mention it. I
| like staying unb&.
|
| [0] https://www.theguardian.com/world/2017/oct/16/malta-car-
| bomb...
| Qw3r7 wrote:
| My thoughts exactly, which sucks.
| adflux wrote:
| What's the equalizer? Revolution?
| petre wrote:
| No, justice. What currently happenes to Szarkozy. Of course,
| all of this happens in a country that guilotined their king
| and his wife, so the revolution helped a bit in that regard.
| namdnay wrote:
| I really really wouldn't take France as an example of how
| to deal with corrupt politicians. There's an astounding
| complacency around corruption here, a politician in the US
| or UK wouldn't have been able to get away with 1% of what
| Chirac or Juppe or Sarkozy got up to in the 80s-90s
| esarbe wrote:
| In all honesty, that's the suitor they are toying with, isn't
| it? As long as they can squeeze some more profit out of the
| common people, there's no reason not to do it. (Just see how
| Amazon treats it's workers.) It's only when people are on the
| barricades that they will relent.
| culi wrote:
| https://www.britannica.com/topic/guillotine
|
| (/s)
| clydethefrog wrote:
| The Great Leverer is indeed historically only achieved by
| violent means.
|
| https://press.princeton.edu/books/paperback/9780691183251/th.
| ..
| rich_sasha wrote:
| I was very excited when Panama papers came out. Intrigued when
| Paradise papers leaked. But now? Damning evidence of outright
| crimes came out and nothing happened. In the UK IIRC it was found
| that David Cameron evaded some taxes via offshore funds, and? He
| said he's very sorry and didn't mean to, and that was it.
|
| Everyone knew before and after the rich don't pay taxes. We don't
| need more evidence, we need action.
| jl6 wrote:
| He didn't evade any taxes. He avoided taxes and did nothing
| illegal. Same story with a lot of these latest leaks.
|
| Immoral? Debatable. But the lack of action is because of the
| lack of a crime.
|
| The action should be to propose new legislation that changes
| what taxes are collected, where, and when.
|
| The main crimes exposed in these are money laundering rather
| than tax evasion.
| lelandfe wrote:
| Without meaning insult, I think you should review the outcome
| of the Panama papers leak again - it may have been a while.
| There has been a staggering amount of legal and financial
| recourse from the leak in countries spanning the globe.
|
| Frankly, I don't know of much else like that leak in history in
| terms of its global impact.
| rcMgD2BwE72F wrote:
| >We don't need more evidence, we need action.
|
| Are these exclusive?
| goldenkey wrote:
| You know damn well what he meant.
|
| * We don't require additional evidence, we need action.
|
| What the fuck is with HN these days? Quit the snide bullshit.
| tailspin2019 wrote:
| Not the person you're replying to but it was just a three
| word reply, which could be interpreted in whole bunch of
| different ways, so it feels like you may have made a bit of
| a leap here... :)
| goldenkey wrote:
| The commenter was succinct. They are pedantically
| subverting and misinterpreting OPs comment into an
| argument about exclusivity, when in fact OP displayed no
| such idea. It's a deliberate sleight.
| KoftaBob wrote:
| Users like that get the impression that being pedantic
| makes you look intelligent.
| kbenson wrote:
| Or maybe they think that words matter and if you care
| enough about something to be calling people to action
| maybe you should care enough to phrase your words so
| they're less ambiguous.
|
| Not everyone reads things the same way, even if you think
| it's the obvious and only way to interpret something. If
| they did, there would be a lot less misunderstandings
| online.
|
| Someone pointing out ambiguity is possibly helping you
| refine your point and message, so if you encounter it
| maybe try to read it less as someone being a pedantic
| asshole and instead someone helping you express your
| message more successfully. At a minimum it will likely
| help you keep a good attitude or emotional state, which
| is nothing to sneeze at.
| goldenkey wrote:
| It was rhetorical and snide. We all know there is no
| exclusivity. OP is just asking for action for the amount
| of already acquired information. He isn't saying we
| shouldn't acquire more evidence.
|
| There is no ambiguity, just verbal gymnastics played by
| those who want to comment in bad conscience as if they
| have somehow furthered the conversation.
| rich_sasha wrote:
| They're not, and sure, more evidence is not a bad thing.
|
| Or is it? My reaction this time was "meh, this again". I'm
| more and more desensitised. If anything, I found it
| demoralising.
|
| So maybe it is actually counterproductive.
| DoingIsLearning wrote:
| > I'm more and more desensitised. If anything, I found it
| demoralising.
|
| Reminds of this explanation of the soviet era
| 'hypernormalization':
|
| "The word hypernormalization was coined by Alexei Yurchak,
| a professor of anthropology who was born in Leningrad and
| later went to teach in the United States. He introduced the
| word in his book Everything Was Forever, Until It Was No
| More: The Last Soviet Generation (2006), which describes
| paradoxes of Soviet life during the 1970s and 1980s. He
| says that everyone in the Soviet Union knew the system was
| failing, but no one could imagine an alternative to the
| status quo, and politicians and citizens alike were
| resigned to maintaining the pretense of a functioning
| society. Over time, this delusion became a self-fulfilling
| prophecy and the fakeness was accepted by everyone as real,
| an effect that Yurchak termed hypernormalisation."[0]
|
| [0] https://en.m.wikipedia.org/wiki/HyperNormalisation
| dylan604 wrote:
| Then, what are the purposes of the leaks. Street cred for
| the hackers, a moral checkbox off the list for a leaker,
| attempt at embarassment for the individuals/firms/banks
| involved?
| rich_sasha wrote:
| Well, kudos to the leakers, and they are doing their bit,
| sure. I guess people with a penchant for investigative
| journalism aren't the same ones as lobbyists, politicians
| etc. They are doing good work.
|
| It's more that without someone taking it to the next
| step, it is in vain. It feels like yet-another report in
| what the world will be like if we don't stop CO2
| emissions. It will be very bad. There are so many reports
| like that, I dont bother reading them anymore. More
| desertification. More hurricanes. Hotter summers, colder
| winters. Droughts and floods, death and disease.
|
| Meanwhile CO2 emissions are still increasing YoY.
| wolverine876 wrote:
| It's not that hard, legally, to resolve this problem. What is the
| obstacle?
|
| It's a serious question, and intended to bypass the distraction
| and debate about despair. What is the obstacle?
| TheAlchemist wrote:
| What problem ? And what solution ?
|
| I think you should start with explaining those first.
|
| Thing is, it's probably easy in theory, but very hard in
| practice.
| xs wrote:
| What I see here is tax evasion. But done in a roundabout legal
| loopholish kind of way.
|
| 1. Establish profitable company in your home country.
|
| 2. Establish 2nd company in a tax haven country.
|
| 3. Give 2nd company some kind of ownership, and then pay rental
| fees, licensing fees, or simply set up a high interest loan that
| the 2nd company loaned the first.
|
| 4. Once you set up a way to make it look like you owe the 2nd
| company tons of money, now your 1st company no longer is
| "profitable" and actually in debt losing money, which means it
| doesn't need to pay taxes on the massive profit it's making.
|
| While I believe it's legal it hinges on bad ethical practice. But
| many large companies do this, such as cruise ships and I think
| Apple.
| dataflow wrote:
| What I never understood is, (how) does the money get
| transferred to the home country eventually? Doesn't it need to
| do that to have some utility? Otherwise, what's the point of
| just accumulating money offshore that you can't eventually use
| where you actually are?
| underdeserver wrote:
| There's a lot you can do, such as borrow against it as
| collateral, transfer it to other offshore companies in return
| for services (the entire deal happening in the tax haven -
| therefore not taxed), or even have it hold property which you
| can then use.
| dataflow wrote:
| But if you use it to pay someone else offshore, presumably
| you get something in return at the home country, right? And
| you didn't pay for it there, right? So isn't the fair
| market value (or something along those lines) of whatever
| you eventually receive in the home country therefore
| taxable income? I don't understand how the value loop can
| legally close without taxation one way or another.
| Mvandenbergh wrote:
| First of all, you can spend money on things outside your
| home country (second/nth house, buying a new yacht, etc.)
| and depending on how those are structured you can avoid
| that being taxable income. If someone takes a direct
| distribution or benefit in their country of residence and
| domicile then yes, those are definitely taxable events
| and careful tax avoiders pay their tax on these
| transactions.
|
| Second your intuition is correct, often people do break
| the law at this point, it's just very hard to detect
| without files like this which is why the previous
| Panama/Paradise leaks have led to so many prosecutions
| and tax recovery actions. They made clear what otherwise
| was secret.
|
| A common tactic is using the funds to buy property in
| which you then live as a tenant. In most countries
| (certainly in the UK) tenancy contracts are purely
| bilateral and non-public. There is no way for the
| government to know whether you are:
|
| 1) living in a property owned by a third party ownership
| company that you genuinely have no links to - btw many
| rich people do this for at least some of their homes so
| it's not like its an inherently suspicious activity. You
| can rent whole houses in central London for 10s of
| thousands a week.
|
| 2) living in a property owned by a company of which you
| are secretly the beneficial owner and paying market rent
| (to yourself). This may be allowed under some very
| carefully structured circumstances but usually not.
|
| 3) Like 2 but not actually paying rent. Definitely not
| allowed.
|
| Technically they could find the difference between 2 and
| 3 if they audited your outgoings but they would first
| have to have a reason to even start doing that. It's not
| like you can take a tax deduction for rent, so this
| doesn't even show up on your taxes, they would literally
| have to pull your bank records to look for the expected
| outgoing rent. Telling the difference between (1) and (2)
| is impossible without the secret ownership information.
|
| Another favourite is to use offshore accounts to buy
| things like jewellery, clothes, furniture, almost
| anything that isn't registrable property (i.e. anything
| other than real estate or vehicles). That is certainly
| illegal since you're taking a benefit which should be
| counted as income and taxed but good luck proving that.
| toyg wrote:
| Offshore entities can own properties in most open
| economies. They don't typically get taxed where they own
| the property or good, but where a profit is realized or
| an action takes place.
|
| For example, in TFA it's mentioned that the Blairs bought
| an offshore company that owned a building in London; they
| really bought the building, but doing it this way allowed
| them to avoid property taxes in the UK that relate to
| ownership transfers ("stamp duty"). They could then hire
| out offices, and if they do that through the offshore
| company that "taxable income" would similarly disappear.
| Her Majesty's Revenues & Customs might eventually object
| to the arrangement, but if the offshore owners are not
| known, what are they going to do, bulldoze a historical
| central London property? Obviously not.
| slavik81 wrote:
| > what are they going to do, bulldoze a historical
| central London property?
|
| Seize the property and auction it off to the highest
| bidder. The process would be quite similar to a
| foreclosure. The problem the UK has is more that the
| stamp duty has countless loopholes. If he doesn't
| actually owe tax, then legally that's the end of the
| discussion.
|
| I have little faith that all the loopholes in a stamp tax
| can be closed. It would be much easier to enforce a
| property tax system. Events are abstract and ephemeral,
| but real property is tangible and immovable.
|
| Survey the area to assess a property tax each year. Mail
| the assessment to the property's address, and include a
| unique account number for payment. You can audit that all
| land in the tax jurisdiction has been assessed, and that
| all assessments have been paid. The only thing you really
| need to be careful about is what criteria you use for the
| assessment. Market value is relatively safe for that.
| toyg wrote:
| That's effectively what Council Tax was originally meant
| to be, but after a while nobody could be bothered with
| the survey activity. They even closed the door to
| piecemeal re-classification, after enough people started
| challenging the band their property sat in, by passing
| legislation that basically states the band is fixed as it
| is until Parliament says otherwise (i.e. likely forever).
| Mvandenbergh wrote:
| Council tax was never meant to be anything like property
| tax and was structured specifically to act in a different
| way.
|
| For example: councils don't actually set their council
| tax rates by band. They set one rate which is the Band D
| rate. The rates of the other bands are then set based on
| fixed %s from that rate and the highest English rate (H)
| is only 200% of the Band D rate.
|
| The value of the lowest valued band H (based on the 1991
| price levels) property relative to the highest band D is
| 3.6x. So right away we see that as a % of property value
| the typical household (D is the most common) in any given
| place pays more than the highest valued local properties.
| Of course it is also the case that band H is open-ended.
|
| There is then the fact that these are set and collected
| exclusively locally. That means that some of the lowest
| council tax rates in the country are in some of the
| richest places. Westminster and Wandsworth have Band D
| council tax in the PS800s, Blaenau Gwent is over PS2000!
| toyg wrote:
| _> Council tax was never meant to be anything like
| property tax_
|
| Well, it was meant to _look_ like a property tax, while
| at the same time ensuring it would disproportionately
| affect the lower classes, for sure. It was a Conservative
| measure, after all (which Tony Blair was obviously
| "intensely relaxed about", since it directed money to
| local authorities Labour controlled, hence it was never
| repealed). As wikipedia reports: _" the Valuation
| Tribunal Service [...] states that: "The tax is a mix of
| a property tax and a personal tax"._
|
| _> They set one rate which is the Band D rate._
|
| Yeah, and they can't even be arsed to figure out if a
| Band D property in 1991 is still a Band D today - the
| roof might have fallen off since then, but hey, who's got
| time to do periodic surveys? Local councils have better
| things to do, obviously.
| curryst wrote:
| Probably stock buybacks. Company 2 then spends the profit on
| buying company 1's stock, which they basically burn. Stock
| prices go up and owners recoup value through capital gains.
| dataflow wrote:
| How do you "burn" stock to raise the price in the home
| country? Sorry, I'm not following the scheme you're
| describing.
| salawat wrote:
| Company 2 bought stock in Company 1. Company 1 owns
| Company 2. Compamy 2 purchased stock that confers no
| rights or dividends.
|
| The money still changes hands. Once you realize enough
| growth, you do a stock buyback. those stocks you issued
| to yourself? poof.
|
| The magic of finance.
| dataflow wrote:
| It boggles my mind that two companies can own each other
| cyclically like this, but regardless:
|
| I still don't get the "poof" part. So we're saying C2 is
| paying C1 for its stock, and I imagine that revenue
| doesn't count as income for tax purposes since C2 now
| "owns" part of C1 in return. As I see it, that means C1
| is effectively getting a loan from C2, putting part of
| itself as collateral. It can spend the loan to grow,
| which is nice, sure. Let's say it does that. Now you're
| saying C1 performs a stock buyback? Wouldn't that mean it
| has to pay _more_ for the stocks (since they rose in
| value)? It 'd have to bring that money from somewhere...
| but where? I mean all it can do at this point is pay back
| the money it got from C2, but then it's even, right?
| There's nothing left over after that, it's just repaying
| a loan as I see/understand it.
| salawat wrote:
| From growth. Remember, half the point of these havens is
| to shelter money from being taxable. Nothing else
| matters. You move it over _there_ for favorable
| treatment. Company 2 received back money from Company 1
| that they invested in, so it 's off Company 1's books
| virtually, but not in reality.
|
| This is the hell created by multi-jurisdictional legal
| fictions. Short of a multi-national crackdown, being able
| to nail down the vagueries a bunch of well compensated
| international accounting firms and lawyers can get up to
| is unlikely at best.
| dataflow wrote:
| I mean even if the company grew 10x, it'd have to pay 10x
| to buy back its shares, so it wouldn't be profiting,
| right?
|
| If I'm understanding this correctly, there are 2 things
| I'm taking away from this:
|
| 1. Cyclic ownerships should be illegal.
|
| 2. The investors (i.e. the public, for a public company)
| are getting scammed here. But it's not because of tax
| avoidance, but because company valuations (and therefore
| share prices) are just utterly meaningless, and people
| are... too oblivious to this? I mean, a "growth" in
| valuation would (to me) be coupled to increase in the
| company's net assets. So if company 1 sells a lot of its
| product and its valuation rises... that means it's
| gaining assets somewhere. Either that increase in assets
| is due to sales revenue at home (in which case it'd be
| getting taxed normally) or it's the stake it has in
| company 2, and presumably company 2's valuation is
| growing. But company 2's valuation is just coupled to
| company 1's, so there's no logical reason for it to rise
| independently. If it does, and the company is getting
| rich that way, that just means to me that people are
| behaving irrationally and paying more for the same thing,
| and _that 's_ what's making companies richer (rather than
| tax avoidance)? Alternatively if you look at it as
| company 2 having revenue and thus company 1's stake
| increasing in value, wouldn't there be an eventual tax on
| that money before any person can realize it at home, and
| thus shouldn't that correct the stock price downward? Or
| am I completely misunderstanding something here?
|
| Edit: I think I'm seeing one way this works: the stock
| price _does_ get corrected downward, but not enough to
| cancel out the growth, since the offshore company _did_
| gain material assets. But then who (as in which person)
| is getting rich without paying taxes at home, exactly?
| Either C1 's shareholders are selling long-term capital
| gains taxes (in which case the complaint is about long-
| term capital gains taxes) or they're doing it short-term
| (in which case they're still paying income-equivalent
| taxes). Who's avoiding taxes here?
| Iv wrote:
| Several EU countries (France and UK) have, IIRC, made very
| clear that fictive debt or fictive licensing fees are fraud an
| would be judged as such.
| [deleted]
| deelowe wrote:
| That's the thing about laws. It's up to the courts to decide.
| sva_ wrote:
| Pretty sure Ikea does it this way, and numerous others for
| sure.
| oneplane wrote:
| Once a company becomes big enough it turns into 'yet
| another big one' that inherits the branding and the
| original activities but simply starts doing whatever else
| is doing to min-max everything beyond human ethics.
|
| It's like having a very small company with only a few
| people. There won't be any HR because that kind of overhead
| isn't something you can afford or make use of. So you work
| 'for the boss' and if you need something your boss is also
| the person who makes the decisions. But when the company
| gets bigger, you now get HR between you and the boss, and
| suddenly you are insulated. You work for the company, and
| are beholden to HR. Every step after that is just more
| insulation, more min-maxing and just making things worse
| for the sake of scale. Usually.
| jacquesm wrote:
| HR does not get between you and the boss, but middle-
| management (hence the name) does. HR gets between the
| company and you if there is a chance of you damaging the
| company, other than that it is mostly (regulatory) window
| dressing and to save some cost on recruiting and
| onboarding.
| laurent92 wrote:
| Movies too. The studio charges the movie, so the studio is
| positive while the movie is in debt. Actors get a lumpsum
| and a percentage on the movie benefits.
|
| In this case, it's not shell companies, the studios
| actually have in-house expertise (=shooting most of the
| movie) while the movie mostly drives the scenario and the
| actors, so it's harder to define what is illegal.
|
| McDonalds also has a franchise system, although it's easier
| to control whether the pricing offered to the franchisees
| is constant or proportional to benefits.
| rich_sasha wrote:
| The UK shouldn't really raise its voice here, easily half the
| tax havens are UK dependencies: Cayman Isles, Virgin Isles,
| Jersey, Guernsey, Isle of Man, Gibraltar. It is inconceivable
| to me that the UK lacks influence to stem these activities,
| so the only conclusion is that it willingly accepts status
| quo.
| unreal37 wrote:
| The City of London itself is a tax haven.
|
| [0] https://platform-
| production.s3.amazonaws.com/therules-134-Ci...
| jacquesm wrote:
| There is a reason that London was the financial
| headquarters of the EU while it lasted. They are going to
| try to do what they can to attract EU capital now that the
| last of these rules no longer apply to them, and will be
| the de-facto tax haven for the rest of the world except for
| the five-eyes.
| rich_sasha wrote:
| Well, the UK is well suited to finance in many ways, most
| of the legit. The way courts work for example. Maybe a
| bit like France and Italy have a natural talent for
| couture, say.
|
| But the shady stuff is sure there, and shady. UK high end
| property market seems to be a Monopoly-esque money
| laundering machine, with the extra inconvenience of
| having physical real estate attached to it.
|
| Maybe one good replacement market for NFTs.
| moffkalast wrote:
| Ireland: _chuckles_ "I'm in danger"
|
| This is literally their entire economy lmao.
| earnesti wrote:
| How can you say what is fictive and what not? Licensing fees
| and loans exist on market anyway.
| nabla9 wrote:
| You figure out what the intent is.
|
| If the same owner is behind both, and there seems to be no
| other reason that avoiding taxes, guilty.
| burnished wrote:
| "oh no, our publicly very profitable company actually
| doesn't make any money because of all the.. license fees we
| pay, that we are clearly in a position to bargain for
| better, yet mysteriously do not! oh its such a coincidence
| that everyone in the C-Suite still makes money off the the
| shell company."
|
| You can obfuscate fraud. But don't try that post-modern
| horseshit "what is being, man" on us.
| travoc wrote:
| Any time legislatures have a hard time defining the line
| between legal and illegal behavior, courts tend to take a
| "we'll know it when we see it" approach. Justice might be
| served but rule of law is diminished.
| kazen44 wrote:
| a major difference between continental law and common law
| is the intent of the law though.
|
| If the court can prove that they did not handle with the
| intent of the law, it can still be decided that this is
| fraud. In a common law system this is not possible.
| bryanrasmussen wrote:
| Common law is based on precedent and common sense
| application of the law, so it is generally common law
| systems which are described as being open to
| interpretation.
| salawat wrote:
| Common sense has nothing to do with common law after a
| couple generations morph any type of sense a law could
| have made into something nigh unrecognizable. Go digging
| through case law in different jurisdictions and marvel at
| the contradictory interpretations that arise. This is why
| strategic changes in jurisdiction are a valuable part of
| litigative strategy.
| tshaddox wrote:
| Not really. "Fictive" just means "not real," and courts
| have processes for judging whether things are real or
| not. The fact that courts still have to judge _the actual
| facts of the matter_ doesn't mean the legislature isn't
| doing its job or that rule of law is diminished. It's no
| different than courts judging the truth value of claims
| in a murder case or a fraud case.
| kemitche wrote:
| The existence of valid licensing fees does not mean all
| licensing fees are valid. Surgeons are allowed to legally
| cut people, that doesn't mean we can't figure out when
| someone was illegally stabbed.
|
| Let's not give up without even trying.
| fragmede wrote:
| Step 4 glosses over a _ton_ of details but is sufficiently
| correct in Apple 's case, which pioneered the Double Irish.
| That was supposed to stop in 2020, but unless you keep up with
| the world of corporate finance and global tax law, things keep
| shifting.
|
| Apple's easy to pick on, they're one of the richest companies
| in the world and should pay more taxes. But for companies that
| are less successful, it's entirely possible that the second
| company _is_ actually losing money. Without an appropriately
| sized army to track through the 200th company (tracking
| transactions between two companies is simplified to make the
| tax evasion easy to understand. Real world tax evasion is
| dramatically more complicated.)
| londons_explore wrote:
| The step here that is illegal is the moment company 1 takes out
| a high interest loan from company 2.
|
| Company 1's directors have to do what is in the best interests
| of the company. If they choose to sign up to a high interest
| loan which will take all their profits, that isn't decision-
| making in the best interests of company 1. That's the point
| they can be put in prison.
|
| I just don't quite understand how nobody is prosecuting them...
| opportune wrote:
| It is technically tax avoidance. Tax evasion = not paying taxes
| you legally owe, is a crime. Tax avoidance = using legal means
| to reduce the amount of tax you owe, not a crime (by
| definition).
|
| This is why I support taxes such as those that France levies on
| digital revenue originating within their country. I also think
| it makes sense to wholly eliminate corporation taxes (which are
| not only avoidable, but are a form of double taxation) and
| replace them with these revenue taxes.
| koolba wrote:
| > Once you set up a way to make it look like you owe the 2nd
| company tons of money, now your 1st company no longer is
| "profitable" and actually in debt losing money, which means it
| doesn't need to pay taxes on the massive profit it's making.
|
| It's called "transfer pricing" and it's been going on for
| decades: https://en.wikipedia.org/wiki/Transfer_pricing
|
| Short of a revenue (as opposed to income) corporate tax or VAT,
| it's a very tricky problem to address. Maybe an excise tax on
| foreign remittances to match the highest corporate bracket.
|
| Or you just scrap corporate tax entirely because it's a
| terrible idea anyway.
| toyg wrote:
| Incidentally, this is the real reason why "Western" states
| are so hung-up on copyright enforcement: nevermind the movie
| bullshit, IP is a door throughout which profits can be
| arbitrarily shuffled around by the rich and the powerful. It
| creates a parallel reality where imaginary goods can be
| transferred from jurisdiction to jurisdiction, creating
| infinite possibilities for transfer pricing. And if anyone
| objects? Ahh, they clearly want to starve artists and
| creatives!
|
| It's genius, and we all go along with it because how can you
| hate art and imagination? It's such a fundamental side of
| human nature. By turning its output into pseudo-goods, we
| think we're moving up in the civilization scale, whereas
| we're just enabling a parasitical accumulation of capital.
| inertiatic wrote:
| Can you explain how that works for someone ignorant like
| myself?
| SpicyLemonZest wrote:
| In general, every country you do business in will charge
| taxes based on the profit you make within that country.
| So what you do is:
|
| * Set up a company in the country where you'd like to pay
| taxes, and give it all of your intellectual property.
|
| * Set up subsidiaries in the countries where you don't
| want to pay taxes. Have them pay licensing fees to the
| first company for the IP, making sure to set the
| licensing fee high enough that the subsidiaries don't
| make much profit.
|
| * Now most of your profit lives in the first country, no
| matter how much business you do elsewhere.
| NaturalPhallacy wrote:
| > _intellectual property_
|
| A concept invented by and for lawyers. Call it imaginary
| property.
| SpicyLemonZest wrote:
| I don't think that it's productive to make up snarky
| names for concepts I don't like.
| pkaye wrote:
| > Or you just scrap corporate tax entirely because it's a
| terrible idea anyway.
|
| If you scrap corporate tax would rich people hold all their
| wealth in corporations so as not to pay any personal income
| tax?
| namdnay wrote:
| You tax it when they take the money out to spend it on
| themselves
| judahmeek wrote:
| That would require a progressive, rather than moralistic,
| sales tax.
| salawat wrote:
| Except they don't. They create corporations to do it for
| them.
|
| As long as creating a legal fiction is a mere matter of
| having someone else do paperwork, you either need to
| extract tax from legal fictions, or kiss a big chunk of
| taxable activity goodbye.
| draugadrotten wrote:
| The best way to "tax" the rich is to make them spend all
| their money. The more the rich consume, the more the less
| rich benefit. It's turtles all the way down after that.
|
| So please order that custom yacht now, all you HN unicorns.
| bsanr wrote:
| What if the point of taxes is not simply to redirect and
| redistribute funding, but also to reduce economic
| activity and, by extension, emissions and inflation?
| judahmeek wrote:
| Yes, Yes, they would.
| trashtestcrash wrote:
| So where do we find the list of names by country?
| r721 wrote:
| >Of the more than 300 politicians and public officials
| unearthed in the PandoraPapers, we profiled more than 50 of the
| biggest names - and their secret offshore holdings -- in the
| Power Players interactive.
|
| https://twitter.com/ICIJorg/status/1444703221558259714
|
| https://www.icij.org/investigations/pandora-papers/power-pla...
| trashtestcrash wrote:
| I guess we have to wait for the full list. There was a map
| with names from other countries than the 56ish shortlisted.
| miohtama wrote:
| Yes, it would be much more interesting to see the
| corruption of your local small and middle tier politicians.
| vmception wrote:
| Imagine the hubris necessary to think everyone has to store all
| their wealth in the country they were born in.
|
| These discussions assume people _didn 't_ pay taxes before
| purchasing assets elsewhere.
|
| Cute.
| jrexilius wrote:
| It also seems a foregone conclussion that if you are wealthy,
| you don't deserve privacy. Admittedly, some of that gets fuzzy
| if you run for a public office, but that isn't really the
| underlying notion being put forward here.
| seibelj wrote:
| Since the beginning of written history there have been taxes and
| there has been corruption. And people respond very strongly to
| financial incentives - notice how people drive out of their way
| to save a few pennies on gas.
|
| Now imagine you have millions or billions of dollars. You do not
| want to hand over 50% of your income to tax authorities,
| especially if a legal way exists not to. And if you make the
| current legal ways illegal, the money will just keep flowing to
| invented ways. There will never be a way to avoid this, unless
| you have a centralized AI super computer that cannot be
| manipulated by fallible humans watching everyone's cash globally
| and enforcing strict rules. And that will never happen.
|
| Most of the Panama Papers revelations were not illegal behavior.
| This article says most of this is perfectly legal. I'm not sure
| what the scandal here is other than humans don't want to give
| half their money away to the government.
| jyscao wrote:
| Amen. While far from being super wealthy, many if not most
| people on HN could probably benefit significantly from better
| tax planning on their own personal incomes.
| mandmandam wrote:
| >many if not most people on HN could probably benefit
| significantly from better tax planning on their own personal
| incomes.
|
| Those people are comfortable, well into the top 10% of
| earners. And I think it's nice that they don't spend money
| hiring a slimeball tax accountant to help avoid paying their
| part to society. I think it's sick that there are people
| making 6 or 7 figures a year helping cunts to save 7 or 8
| figures a year that should be going into schools and
| infrastructure, and it's even sicker that those people are
| looked up to because they drive nice cars and wear expensive
| suits.
|
| But that's not what these papers are about - they're about
| systematic secretive theft, from all society, on a massive
| scale. And this at a time when people are still dying from
| hunger and deprivation even in the richest countries.
| Iv wrote:
| That's like saying murder should be legal as it is impossible
| to totally prevent it.
| seibelj wrote:
| And now you are comparing tax evasion to murder! I would say
| there's a difference. Otherwise we need to give the IRS
| execution abilities(?)
| miohtama wrote:
| Is there any way to get access to the source material?
| unreal37 wrote:
| No, there never is.
| geysersam wrote:
| Some is available: (ICIJ document
| database)[https://offshoreleaks.icij.org/pages/data]
| lmeyerov wrote:
| This would be fun to visualize! If someone is doing a jupyter
| notebook of it, I'd love to try doing some GPU graph views, let
| me know!
| blobbers wrote:
| Not loading for me. DOS? Or blocked by our friends above?
| erk__ wrote:
| Loading fine for me so probably some routing issues
| hashimotonomora wrote:
| They are making it look bad or controversial, but offshore
| banking in itself is not wrong. They should concentrate on
| corruption at the source level. This report is worrying from a
| privacy perspective, looks like generalized blackmailing, and
| attempts to generate attention to ICIJ who benefits from it.
|
| Edit: please articulate why you disagree with my comment instead
| of downvoting, as this comment is on topic and downvoting should
| be reserved for irrelevant or offensive comments.
| emmelaich wrote:
| Another good read is
| https://www.abc.net.au/news/2021-10-04/pandora-papers-austra...
|
| Australia's ABC TV will be doing a "Four Corners" program on the
| subject tonight.
| 1024core wrote:
| I would much prefer that the ICIJ make the original raw data
| available. Right now we don't know what they have omitted from
| the data.
|
| ICIJ: stop being the gatekeepers.
| nojito wrote:
| Why would they release raw data?
|
| That would be a massive break of journalistic integrity.
| moffkalast wrote:
| People still have journalistic integrity these days? Now
| that's a real joke.
| xojoc wrote:
| Previous leaks can be downloaded from here:
| https://offshoreleaks.icij.org/pages/database So probably the
| Pandora Papers will be downloadable in the near future too.
| tpmx wrote:
| _The database does not divulge raw documents or personal
| information en masse. It contains a great deal of information
| about company owners, proxies and intermediaries in secrecy
| jurisdictions, but it doesn't disclose bank accounts, email
| exchanges and financial transactions contained in the
| documents._
| missedthecue wrote:
| None of the named people are American. Interesting.
|
| https://www.icij.org/investigations/pandora-papers/power-pla...
| slowmovintarget wrote:
| None of the named people in the article are from the US, yet
| the actual papers have Americans aplenty:
|
| > ...more than 130 billionaires from Russia, the United States,
| Turkey and other nations.
|
| But you right, zero politicians from the US appear in the
| Pandora Papers themselves.
| petr_tik wrote:
| I am not American and don't know how much coverage of
| European/World news an average American consumes (without US-
| centric commentary).
|
| It's also worth noting that earlier this week, this came out as
| confirmation of insider trading by the policy makers, who are
| even less elected than Erdogan
| https://www.ft.com/content/b899a77f-9853-4d20-ad84-21848b7e7...
| eyeball wrote:
| Wonder if the person who leaked it will be killed in a car
| bombing like the journalist who broke the Panama papers.
| wolverine876 wrote:
| Can you provide some evidence of that happening?
| eyeball wrote:
| https://nypost.com/2017/10/16/panama-papers-journalist-
| kille...
| lamontcg wrote:
| So who is the modern day robinhood out there that is sponsoring
| these hacks and leaks?
| twofornone wrote:
| >The files include disclosures about major donors to the
| Conservative party, raising difficult questions for Boris Johnson
| as his party meets for its annual conference.
|
| Not to start a flamewar but its increasingly blatant bullshit
| like this that makes me extremely wary of modern news media. The
| disingenuous implication here is that in all 11.9MM documents
| there were only ties to conservatives. It's lying without telling
| a lie. In fact this paragraph serves no purpose except to push a
| political agenda and take a dig at the British analog to Trump,
| who seems to get the same treatment in media.
| Wronnay wrote:
| Why do politicians send their money to offshore havens when they
| could reduce the tax in their own country?
|
| So that it doesn't affect their source of income? (The taxes we
| ordinary ppl pay)
| vnjxk wrote:
| so they could keep pour money into whatever makes their voters
| happy
| rcMgD2BwE72F wrote:
| > Why do politicians send their money to offshore havens when
| they could reduce the tax in their own country?
|
| Maybe because the people actually want to tax the rich? And
| because the politicians who evade taxes don't intend to pay
| their fair share anyway?
| moffkalast wrote:
| When has the will of the people ever effected what
| politicians do?
| lugu wrote:
| How do you know what the will of the people is?
| lifty wrote:
| Many of the fortunes you see in these leaks are illegally
| obtained through political favoritism.
| odiroot wrote:
| By taxing one group of people you have the means to "buy" votes
| from other groups of people. Helps staying in power.
| input_sh wrote:
| For those wondering how this compares to Panama and Paradise
| Papers, those were leaks from mostly one company. This one
| includes 14 spread across many jurisdictions.
| beermonster wrote:
| Thank you. I was in fact wondering ! :)
| david_allison wrote:
| 502s. Is this mirrored?
| xojoc wrote:
| It loads fine for me.
| mathattack wrote:
| I was ok on the main page. I got 502 when I went to the Secrecy
| Brokers section. Appropriate I guess.
| ta1234567890 wrote:
| 504s here
| jumelles wrote:
| This is fascinating - but who decided to name them Pandora,
| Panama, and Paradise? Way too easy to mix them up.
| rescbr wrote:
| Paradise - "tax haven" is translated as "tax paradise" in many
| languages.
|
| Panama - well, Mossack Fonseca was in Panama.
| megous wrote:
| ...Papers
|
| Some alliteration fetish.
| VladimirGolovin wrote:
| Alliteration makes the names more catchy.
| fmakunbound wrote:
| > For a few hundred or a few thousand dollars, offshore providers
| can help clients...
|
| Heh this is totally affordable for regular jack offs like me.
| Perhaps someone will create a public benefit corporation (benefit
| for the irony), democratize access to these schemes for everyone,
| draw the ire of government when tax revenue plummets and lead to
| new laws enacted.
| [deleted]
| __turbobrew__ wrote:
| In Canada, shell companies -- run by the owner's lawyers -- can
| hold property and there is no way to trace the property back to
| the original owners. The courts have found that the lawyers
| cannot be compelled to divulge the property ownership under
| lawyer-client confidentiality.
|
| It is kind of insane that this is even allowed. How do you plan
| to tackle money laundering, corruption, and transparency when you
| cannot even figure out who owns the property in the first place?
| turbinerneiter wrote:
| If there is no owner to be found, it becomes government
| property. I think the owners would present themselves quickly.
|
| We let this happen. We don't have to.
| philjohn wrote:
| More to the point, the Canadian parliament could simply
| outlaw this property holding arrangement.
| newsclues wrote:
| Not when members of parliament are property flippers in
| some of the most expensive places in the world.
| goatsi wrote:
| At least in BC a new law means that the Beneficial owner needs
| to be identified.
|
| https://www2.gov.bc.ca/gov/content/housing-tenancy/real-esta...
| __turbobrew__ wrote:
| We will see if this will hold up in court. When the ultra
| rich are threatened you can bet that a long lawsuit will
| follow.
| [deleted]
| young_unixer wrote:
| This is why Monero is the future.
|
| With Monero, anyone can hide as much money as they want, and
| transact with trusted parties without anyone knowing, and there's
| no practical way for any government or journalist to snoop on
| them.
| ostenning wrote:
| Maybe, governments are on the offensive against privacy coins
| like Monero. I believe Australia outlawed it. I wouldn't be
| surprised if increasingly harsh penalties were imposed as their
| popularity grows
| moffkalast wrote:
| The thing about decentralized things though... they tend to
| be nigh impossible to effectively ban.
| Zircom wrote:
| I was just reading today the IRS has an outstanding bounty of
| 625,000 for anyone that can find a privacy vulnerability in
| Monero, not that anyone is gonna sell it to the US Government
| for that little when you can get so much more on the dark
| net/black market
| tgv wrote:
| Another way to withhold money from the poor. Excellent
| thinking. What's next? A little execution every now and then to
| keep them under control?
| young_unixer wrote:
| Another way to protect your money from being stolen, yes.
|
| Having money is not violent, so I don't know why you bring up
| executions. The violent ones here are the governments.
| [deleted]
| mike_d wrote:
| https://ieeexplore.ieee.org/document/8806723
| Iv wrote:
| It is time to cut down the tax havens from international
| financial circuits.
| earnesti wrote:
| Just ban them from using bitcoin and other cryptocurrencies and
| we should be fine.
| piokoch wrote:
| How could you cut off City of London Corp from international
| financial circuits. Or the Netherlands, which is one big tax
| paradise even though it may seem it is not. Luxembourg? Don't
| think that tax heavens are some remote, distant islands
| governed by some petty lord.
|
| Taxation is really hard to enforce in the modern World. The
| biggest problem is that small, local companies cannot compete
| with big ones because they don't have resources to overcome
| taxation.
|
| For me it make sense more sense to abandon corporate tax at all
| and make sure that all the resources, public services that
| company uses in a given country are paid by the company. If
| company uses trucks, it should pay for roads, etc.
|
| I don't think that Facebook that operates from US and uses US
| resources and services should pay CIT tax in, say, France. If
| it uses internet infrastructure, just make Facebook to pay for
| it fair amount and that's all.
| rcMgD2BwE72F wrote:
| >Taxation is really hard to enforce in the modern World.
|
| No, City of London only exists as it is, because the rest of
| the country let it do its thing and destroy the fabric of the
| society.
|
| It's not hard to enforce taxation when those who make the
| laws actually intend to have it enforced. Right now, those
| who write and enforce the law keep siding with those who
| evade taxes. Maybe we should change the people in power, and
| that is not _that_ hard. The problem is that most media are
| owned by the ones who evades taxes, so the level of noise
| made these scandals remains under control.
| unreal37 wrote:
| The United States is a tax haven.
|
| [0] https://www.forbes.com/sites/toddganos/2019/09/19/worlds-
| bes...
| lordnacho wrote:
| It's time to have a big talk about transparency.
|
| Some of the people who defend the ultra-rich are also the ones
| who claim to be in favour of free markets. A small bit of
| economic orthodoxy is that for free markets to work, parties need
| to be informed (and externalities priced in, but that's another
| story). This is not just in terms of "this is the price of
| bananas" but also in terms of knowing eg what various salaries
| are, which businesses are profitable, etc.
|
| How can we have free markets when we don't even know who owns
| what?
|
| As for taxation, there needs to be an overhaul. Things need to be
| simpler, and I say this as someone who has used international tax
| advisors. There's no reason the tax guy's diagram of your
| business should be more complicated than your own diagram. Moving
| profits to other countries shouldn't be possible, or rather, it
| should be more fixed by the nature of the business than by the
| desires of the CFO. We simply hear too much about "selling IP
| rights" to subsidiaries and similar schemes that are clearly
| meant to lower tax rather than increase revenue. Granted some
| things will be legitimate, but it's important that some vague
| concept of fairness is adhered to. This again goes back to
| transparency. We invented corporations to help improve society,
| so we ought to know what kinds of things people are doing with
| them.
|
| Edit:
|
| Perhaps the way to see it is, if you say "we make money by
| selling coffees in the UK" you would expect that entity to report
| a tax structure that contains a bunch of coffee and UK related
| entries. Reporting to investors ought to mirror reporting to the
| taxman.
| chiefalchemist wrote:
| > How can we have free markets when we don't even know who owns
| what?
|
| Good point, but take a number. We can't have free markets
| because most "regulation" is set up to favor some side or the
| other. There isn't even and fair competition. What we have is
| government sanctioned winners (and losers).
|
| Before we get to who owns what, let's talk about how Uncle Sam
| can shamelessly put his thumb on the scale (read: bias and
| corruption) and too rarely be called out for doing so.
| whakim wrote:
| I think this hits the nail on the head. Wealth is protected by
| a vast array of national and international laws and
| institutions - everything from protection of intellectual
| property to the technicalities of making sure that you and I
| can't both own the same piece of property at the same time. In
| return for this, it's not unreasonable for national governments
| to require more transparency in terms of who owns what. (By the
| by, I think the real reason this doesn't happen is the obvious
| suspicion that it could lead to more progressive forms of
| taxation, e.g. wealth taxes.)
| pibechorro wrote:
| // How can we have free markets when we don't even know who
| owns what?
|
| Free markets exist regardless of how you choose to assign
| property to people. Be it violence or consensus. Ownership is
| to be decided by the parties involved in the exchange. 3rd
| partys are an easy solution.
| pessimizer wrote:
| > Ownership is to be decided by the parties involved in the
| exchange.
|
| No, ownership is to be decided by governments who use force
| to protect property rights. They may take advice from the
| parties involved in the exchange, they may decide that
| neither party involved in an exchange was the owner.
| cblconfederate wrote:
| Alternatively, governments need to open up these schemes to
| everyone so they become accessible to every middle class
| person. BUT they 'll also have to compete with other
| governments about providing better and transparent taxation
| options. Right now the schemes are limited not only to the rich
| but to the well connected rich
| bobbob1921 wrote:
| Maybe part of solution is higher sales taxes , and less (or
| zero) other taxes. Ie tax mainly (only?) at the purchase of a
| good or service. I don't recall seeing massive sales tax fraud
| scandals, atlease at any meaning scale.
| whakim wrote:
| Sales taxes are logistically simple but also highly
| regressive, so the wealthy wouldn't even have to use
| loopholes to enjoy an ultra-regressive tax system :).
| specialist wrote:
| > _We simply hear too much about "selling IP rights" to
| subsidiaries and similar schemes that are clearly meant to
| lower tax rather than increase revenue._
|
| Huh. Made me wonder if advocates of IP reform could claim
| improved tax sanity as a benefit.
|
| Happily, not an original thought.
|
| Here's the first hit via ddg:
|
| Intellectual Property Law Solutions to Tax Avoidance [2015]
|
| https://www.uclalawreview.org/pdf/62-1-1.pdf
|
| _" Multinational corporations use intellectual property (IP)
| to avoid taxes on a massive scale, by transferring their IP to
| tax havens for artificially low prices. Economists estimate
| that this abuse costs the U.S. Treasury as much as $90 billion
| each year. Yet tax policymakers and scholars have been unable
| to devise feasible tax-law solutions to this problem. This
| Article introduces an entirely new solution: change IP law
| rather than tax law. Multinationals' tax-avoidance strategies
| rely on undervaluing their IP. This Article proposes extending
| existing IP law so that these low valuations make it harder for
| multinationals to subsequently litigate or to license their IP.
| For example, transferring a patent for a low price to a tax-
| haven subsidiary should make it harder for the multinational to
| demonstrate the patent's validity, a competitor's infringement,
| or entitlement to any injunctions. The low transfer price
| should also weigh toward lower patent damages and potentially
| even a finding of patent misuse. Extending IP law in such ways
| would thus deter multinationals from using IP to avoid taxes.
| Both case law and IP's policy justifications support this
| approach."_
|
| Also...
|
| > _How can we have free markets when we don 't even know who
| owns what?_
|
| Yup. Open markets require symmetrical information.
| thr0wawayf00 wrote:
| > We invented corporations to help improve society
|
| I think it's easy to say this, but I'm not sure the history of
| corporations bears this out. Technically, the first
| corporations were colonial expeditionary forces (like the Dutch
| VOC) that were sent to Africa and the Caribbean to control
| various types of precious resources and we all know what
| happened there.
|
| I guess it all depends on who "society" is in your statement,
| because someone has always has to lose in a corporate
| structure.
| lordnacho wrote:
| Yeah perhaps I should say I was thinking more about the
| limited liability form that got established sometime in the
| 1800s across a variety of western countries. The government
| orgs are a thing too, of course, but things that are that
| closely tied to government tend to have their own access to
| enforcement.
|
| It's more that at one point during the industrial revolution,
| it became common that someone would make a private venture,
| incorporate it, and from there the law granted a number of
| modern considerations that we still live with. I'm thinking
| of limited liability and its effect on bankruptcy.
| earnesti wrote:
| Firsr corporations were basically groups of people killing,
| torturing and exploiting less advanced civilizations
| overseas. Over the time capitalism has developed towards more
| peaceful culture, not the other way around as people often
| imply.
| thr0wawayf00 wrote:
| I'm certainly not trying to imply that capitalism is more
| or less peaceful than it was in the 17th century, I guess
| the main point that I'm trying to make is that corporations
| exist to generate profit, they never really existed to
| improve society.
|
| A lot of the shifts towards a more humane version of
| capitalism came through outside forces like organized labor
| (i.e. the 40 hour workweek, the establishment of child
| labor law, etc.). These were not things that corporations
| volunteered, it took lots of people threatening to stop the
| system in order to achieve many of the benefits we enjoy
| today. We'd still be working 7 days a week starting as
| small children if those outside forces didn't establish
| many of those fundamental changes for us.
| [deleted]
| LudwigNagasena wrote:
| The VOC was established by the government because it didn't
| like that there were many competing merchant companies. It
| wasn't the first company, it was sort of the first public
| company.
| thr0wawayf00 wrote:
| Sure, I'm not trying to argue that VOC was the very first
| company. Companies of various types date back to the silk
| road. But large-scale corporations were largely
| conceptualized during mercantilism and their history is
| inextricably tied to colonialism, which can't be overlooked
| when people start saying things like "corporations were
| created to help society." They helped some people, but they
| also wiped out entire populations (see the Banda Islands).
| mistrial9 wrote:
| I read a lengthy account of US Corporate history in
| graduate school (whose exact title eludes me at the
| moment). My impression is that in the US, there was a
| desire to tie transportation to broader physical markets,
| and include decreasing costs by owning the warehouse and
| distribution infrastructure. On the marketing end, a
| common brand name for a family of products was also owned
| by the corporation. An important early US example is the
| National Biscuit Company NABISCO. There were no US
| national food companies, as each market had the
| combination of brands, storage and distribution for the
| food product. The corporation held assets large enough to
| tie market regions together. It was not a small feat and
| was very much the Big Markets Tech of the time. Sears and
| Roebuck from Chicago form a different model, with non-
| perishable goods.
|
| For international finance, early 20th century oil played
| a special role, not adequately described here.
|
| As far as the parent comment about corporations "killing
| people" .. this is true but naive.. since the Romans and
| before, brutality was the norm, not the exception. Every
| educated person and most others knew about extreme forms
| of collective abuse, it had happened again and again. The
| very formation of civilization, including merchant and
| trade functions, was generally meant to be an improvement
| on past forms. Rarely, but with serious circumstance,
| some merchant company would rape and murder their way to
| fortune for a while. But karma is a bitch as they say,
| and those things did change. The tame history I cite
| above, was specifically aimed at making a better economic
| engine, for profit by ownership, which upon consideration
| was the chosen path.
| thr0wawayf00 wrote:
| That's really interesting, I'd read the crap out of that
| US corporate history book if you ever recall the name.
| LudwigNagasena wrote:
| >can't be overlooked when people start saying things like
| "corporations were created to help society."
|
| Uhm, who says that? Corporations were always created by
| people who wanted to cooperate to pursue their common
| interests.
| eropple wrote:
| That's not correct. Corporations, particularly in the
| limited-liability sense of the term, are created by
| _society_ , not people. The laws of a jurisdiction
| provide a carve-out for a fictional entity that gets
| special rules to protect the people who act as its brain.
| But that's different from those people _creating_ it.
|
| And to this end, the only reason to create a corporation
| _is_ to make society better. If they 're not, we have the
| ability to revoke their charters, and we should use that
| more.
| thr0wawayf00 wrote:
| > And to this end, the only reason to create a
| corporation is to make society better
|
| I'm sorry but this is patently false, the reason to
| create a corporation is to capture profit.
|
| Want to make society better? There are numerous non-
| profit and government organizations that broadly aim for
| this goal which do not turn a profit. The goal of a
| corporation is to sell goods or services, and hopefully
| those goods or services do in fact better society.
| However, this is far too often not the case to make the
| argument that corporations exist to improve society. Look
| at how much control corporations have over our society
| today, they're practically invincible and indemnifiable
| in our current culture because they're so much more
| insulated legally than individuals.
| eropple wrote:
| Perhaps I was unclear, but you get that you're lecturing
| me about what I just said, right? What you are describing
| is the goal for a person to apply to have a corporation
| created for them to manage. That's not the reason that
| society allows corporate charters to exist. Society need
| not allow a corporate charter to be established that does
| not benefit that society, and can revoke them should they
| not be achieving the goals of the society that grants
| them.
| thr0wawayf00 wrote:
| It is literally a direct quote from the post I originally
| responded to.
| einpoklum wrote:
| "Free" and "market" are contradictions. Markets exist when
| individuals can amass capital irrespective of wider social
| needs, and this necessarily requires armed force, or the threat
| of armed force, to prevent people from collectively deciding
| about resource allocation. That's the state. Naturally the
| state also enforces many things besides ownership of capital,
| some of them better (like minimum wage and health and safety
| codes) and some worse. But the point is that even if you had
| the fantastical and anti-realistic "perfect information",
| markets wouldn't be "free".
|
| At the same time, markets do "work". That is, the results of
| market interactions are what you might expect from market
| interactions: Accumulation of capital in fewer hands, economic
| cycles of various kinds, some motivation for innovation and
| lots of innovation for exploitation, war, scams and such...
| losvedir wrote:
| You call it "economic orthodoxy" but it's really nothing of the
| sort. There's not even really a technical definition of "free
| markets" so I don't know where you're getting your assertions.
|
| I think you're kind of gesturing at the concept of "perfect
| competition", which is rigorously defined and does have
| technical requirements [0], one of which is perfect
| information. But it actually doesn't really apply to the tax
| situation of the owner.
|
| In other words, for political and ethical reasons, there's a
| lot of reform that can and should be done, but I wouldn't dress
| up the argument in the form of "economic orthodoxy", unless
| you're talking about actual economic orthodoxies like lowering
| corporate income tax and preferring VAT to personal income tax.
|
| edit: I should soften my confidence here, it's been a while
| since I did economics. At least, I've never heard of
| transparency extending beyond the good or service being a
| requirement for perfect competition... do you have a source for
| that, or can you clarify how it would affect things?
|
| [0]
| https://en.m.wikipedia.org/wiki/Perfect_competition#Idealizi...
| lordnacho wrote:
| > unless you're talking about actual economic orthodoxies
| like lowering corporate income tax and preferring VAT to
| personal income tax.
|
| Those are more political ideologies than anything.
|
| By economic orthodoxy, I simply mean that it's a fairly
| common economic teaching that bad things happen when parties
| are uninformed. For instance Akerlof lemons is about
| information asymmetry.
|
| I'm not referring to any specific model (monopolistic
| competition etc) but to the general observation that a fair
| few economic models point out that having wrong information
| causes problems.
| [deleted]
| pjc50 wrote:
| > Reporting to investors ought to mirror reporting to the
| taxman.
|
| This would be a nice simple GAAR: you pay either the current
| corporate rate or 20% of the GAAP profits you report in your
| stockmarket statement, whichever is the larger.
| WanderPanda wrote:
| If they don't release the raw data I suspect it will be mostly
| about left/right wing populism
| wallace01 wrote:
| How come all the players are from anywhere but US?
| maybelsyrup wrote:
| I've wondered a lot about this with the Snowden and Wikileaks
| stuff, and I wonder about it with this topic too: the most
| salient part of this story, and about Panama Papers etc. before
| it, is how small a dent it seems to make in the discourse, and in
| the world as a result. At best, these stories get a good chunk of
| the airwaves for a couple of weeks, and then it's on to the next
| thing.
|
| In history books, you get a sense sometimes that there were eras
| in which stuff like this sent people into the streets in rages.
| In which governments were voted out or overthrown, in which
| meaningful legislative responses were made. Or, you know, riots.
|
| But I look around after reading those books and wonder what makes
| us so different. It's weird to live in this era. I read a
| Guardian article like this and look at the staggering sums, this
| entire "shadow financial system" devoted solely to one notion: _I
| 'm going to take as much as I can, in whatever way that I can,
| regardless of legality, and I'm going to give nothing back
| because I sincerely don't believe I owe anything back -- oh, and
| I'm going to keep it all a secret._
|
| And I look around and not only don't see any riots; I sometimes
| get the feeling that people are actually envious, sometimes even
| respectful of the ingenuity it takes to manufacture these
| schemes. It's tough.
|
| The only silver lining I can think of is what all the secrecy
| says: _we 're not just doing this in the open because we're still
| afraid we'll end up like the Romanovs if too many of you get
| angry_. I think that while they're still afraid, there's still
| some hope.
|
| EDIT: Reading some replies. It's weird to have to say this to
| such a smart crowd, but I'm not advocating riots as such; I'm
| advocating a substantive response. Of course riots are "bad" in
| some sense, but my observation is really about the odd contrast
| between the huge size of the "stimulus" (theft of wealth, much of
| it _yours_ , on a staggering scale) and the tiny size of the
| "response" (newspaper articles and web forum discussions),
| especially when contrasted with other historical periods. So
| while I wouldn't "want a riot", seeing one would make me go
| "well, that makes sense".
| SergeAx wrote:
| The thing is, there are no ingenuious schemes. Offshore
| companies are just a tool everybody knows about. For a wealthy
| 1% having an offshore company is just a norm. Or several of
| them, for that matter. And our everyday discourse is defined by
| those 1%. Jeff Besos owns The Washington Post, for damn sake.
| simonh wrote:
| Right, we all know offshore havens exist, we all know rich
| people and companies use them. So papers showing that these
| rich people are using these tax havens is not exactly
| surprising. That's not to condone this activity, it's just
| that I'm surprised anyone thinks the response would be
| otherwise. We know about this stuff already in general, this
| is just specifics and as the guardian points out it's not as
| if all this in even necessarily illegal. We just need to push
| harder to shut down these loopholes.
| [deleted]
| c3534l wrote:
| There have definitely been riots in the streets. In some parts
| of the world, there was with the Panama papers. But there
| weren't really many important Americans implicated in those
| papers. Here, we decided to riot over police murdering black
| people and the election of Trump, but it was honestly probably
| more about being sick of living with the pandemic than anything
| else. I think you have to be willing to riot first, then
| something has to happen for you to react to, and then we point
| at that event and say it caused the riots. But I think history
| is more of a series of catalysts than a true sequence of cause-
| and-effect.
|
| Snowden changed the discourse, but it wasn't a catalyst for
| change, unfortunately. I guess we're just not ready to change.
| When we are, maybe we'll look back at these events as early
| precursors that showed stress in the system before it snapped.
| Or we'll view them like we do the Luddites: trying to reverse
| the inevitable course of history.
|
| In my experience seeing a black neighborhood errupt in protests
| after seeing another black man killed - while I personally
| think that black man in particular was not innocent - that
| neighborhood was ready to riot. The police in that area were
| brutal, abusive, and racist. The people in that area were
| subject to segregation that saw them receive worse education
| and job opportunities than the white neighborhoods. The
| government was unresponsive to their needs and, on the
| contrary, viewed them as a nuisance bringing down property
| values, and hurting their stats on standardized test scores.
| Then a black man was killed and they said they'd had enough of
| this, and then everyone says "the went to the streets because
| that man was killed" - which is both true and irrelevant. A
| small breeze will knock down a house of cards, but the fact
| that the house is made of cards is more important than the fact
| that the breeze caused it to collapse.
| ztjio wrote:
| I suggest you reconsider your position about nothing happening.
| Many people think nothing happened in response to the Panama
| Papers and those people are all wrong.
|
| https://www.icij.org/investigations/panama-papers/what-happe...
| BurningFrog wrote:
| Life for us masses has never been better.
|
| Lots of crooks in power, sure, but if you know history that's
| how it's always been. How human societies typically work like
| that, and maybe they have to.
|
| The numbers look big, but in terms of dollars per citizen, how
| much money are we really talking about?
| maybelsyrup wrote:
| > The numbers look big, but in terms of dollars per citizen,
| how much money are we really talking about?
|
| I'm not sure what you intended with this, but it's a really
| good empirical question. Since we have no reason to believe
| any one of these "leaks" is exhaustive, we don't ever know
| the true denominator, so we can't estimate dollars-per-
| citizen with any confidence.
|
| But we do know the realities of being poor. So if the true
| dollars-per-citizen-per-year figure turns out to be as little
| as, say a thousand dollars, I think a lot of people would be
| justified in eyeing their pitchforks. Hell, an extra fifty
| dollars a month in the developed world would make a massive
| difference for millions who struggle.
|
| Personally, I believe that the true number is very plausibly
| in this range.
| BurningFrog wrote:
| > _I 'm not sure what you intended with this, but it's a
| really good empirical question._
|
| It's an honest question, and I am genuinely curious of the
| numbers in these revelations. How much bigger the real
| number is we can only guess.
|
| > _Hell, an extra fifty dollars a month in the developed
| world would make a massive difference for millions who
| struggle._
|
| Sure, but that assumes such a system is possible, _and_
| that it is desirable. I 'm doubtful on both.
| woile wrote:
| I have the same feeling, like we were slowly indoctrinated into
| believing that upvoting is the only thing we can do and
| participation is worthless.
|
| I recently watched this video[0] that shows how public
| perception over cars has been influenced over many many years
| into what we now have (and we now perceive as normal). I feel
| like it's somewhat related.
|
| [0]: https://www.youtube.com/watch?v=oOttvpjJvAo
| eli_gottlieb wrote:
| My current theory is that every time the masses take to the
| streets in outrage at the corruption of the system, the so-
| called "leadership" of the new social movement tries to divert
| it into their own political hobbyism.
| chaganated wrote:
| take what the romans already knew about democracy, sprinkle a
| little fluoride on it, and there's your answer. also, this is
| not a smart crowd.
| [deleted]
| ricardobayes wrote:
| There are no morals in the world anymore, we are driven by
| money. To buy that rolex, that BMW, that beach house. These
| things have been made accesible to more people than ever - so
| people don't want this to change for the worse. Status quo is
| good.
| tejohnso wrote:
| Maybe the average person is just too well off to care?
|
| When you're barely getting by, or worse, have had family
| members die of starvation, it's more offensive, and you have
| less to lose, and so more likely that you'll take out the pitch
| fork and hit the streets.
| slim wrote:
| In history books time is compressed and history is distilled. I
| can tell you that revolutions are the result of small dents
| like these that build up over years
| irrational wrote:
| I think the difference is that most of us are not starving, not
| sleeping cold or outdoors, are receiving an education for our
| children, are able to find some form of work, etc. Its hard to
| get people rolled up enough under those circumstances.
| stef25 wrote:
| Personally I can't get myself worked up over this, mainly
| because I don't think it would make a difference if these
| people didn't do what they did.
|
| Would our lives be any different if the king of Jordan had paid
| his taxes? Would the UK be better off if Blair hadn't found a
| way of saving a couple hundred grand off his latest real estate
| purchase? Etc
|
| Also I have no shame in admitting I'd do exactly the same if I
| had that kind of money.
| toofy wrote:
| One of them. No. But I don't think anyone is saying that one
| single instance would change everything.
|
| If all of those who make a couple million a year who also
| avoid their taxes were to pay them, yes.
| rcMgD2BwE72F wrote:
| >And I look around and not only don't see any riots; I
| sometimes get the feeling that people are actually envious,
| sometimes even respectful of the ingenuity it takes to
| manufacture these schemes. It's tough.
|
| What riots did you participate in? If none, are you among the
| ones you assume to be envious?
| misnome wrote:
| That clearly isn't what they said.
| UncleOxidant wrote:
| I hear what you're saying, but I don't think anyone is
| surprised anymore that the rich and powerful are manipulating
| the financial system. There's also a sort of unreal, weird
| aspect to these leaks. I get the feeling reading the article
| that there's either a lot they're leaving out (possibly just
| because it's too soon for them to have combed through all of
| the information) or that these leaks are orchistrated in some
| way to make certain political opponents look bad while other
| prominent politicians remain un-named and unscathed. I just get
| a distinct feeling that while yes, this stuff is likely quite
| true, it's purposely not complete (not blaming The Guardian
| here, I'm thinking the leakers are maybe leaking selectively).
|
| They mention King Abdullah II of Jordan, but how likely do you
| think it is that there could or would be any consequences for
| him? It seems highly unlikely.
|
| Also, they mention that Putin is not named directly in these
| papers, but we can be pretty certain that he's been involved in
| all sorts of financial skullduggery. Yes, they say that some of
| his close associates are mentioned, but even if it can be tied
| directly to Putin with 100% certainty it would have little to
| no effect in removing him from power as his power over Russia
| at this point is too strong for such allegations to have any
| effect.
|
| And Who benefits from making Zelinskiy look bad?
|
| EDIT: Maybe we're not more shocked because we suspect that if
| we knew the whole story it would actually be much worse than
| this?
| baybal2 wrote:
| > Yes, they say that some of his close associates are
| mentioned, but even if it can be tied directly to Putin with
| 100% certainty it would have little to no effect in removing
| him from power as his power over Russia at this point is too
| strong for such allegations to have any effect.
|
| Very simple, USA orders global sanctions on the guy, and we
| will all see what next stupid thing it will provoke him into.
|
| All these Magnitsky acts are silly, and useless when they
| keep going against accessories to the criminal regime, while
| not going against that criminal regime itself, and especially
| the chief motherfucker in charge.
|
| The few times USA has ever attempted to sanction heads of
| states personally were few African states, Norko, and
| Philippines
| maybelsyrup wrote:
| I think about this exact thing a lot. Of course, I have no
| evidence for it, but it's always on my mind in a story like
| this. It's always a certain slice of the global elite being
| embarrassed in the stories, isn't it?
| igivanov wrote:
| >Putin is not named directly in these papers
|
| yes that's absolutely damning. typical Putin /s
|
| can you share more of your conclusions based on absence of
| evidence?
| kapp_in_life wrote:
| People aren't going to riot if their lives are pretty good,
| regardless if others are cheating the system. Bread and
| circuses.
| namdnay wrote:
| I agree with you on the first sentence, but I don't think
| it's necessarily bread and circuses. Just peace and
| prosperity. Pax Capitalisma if you will
|
| Bread and circuses was politicians getting into debt or
| Emperors dilapidating the treasury to buy the support of the
| masses, I don't think that's really the case here.
|
| It's more that if people are prosperous and safe they stop
| caring enough
| salawat wrote:
| >Bread and circuses was politicians getting into debt or
| Emperors dilapidating the treasury to buy the support of
| the masses, I don't think that's really the case here.
|
| I would like you to think about this paragraph.
|
| Now think about UBI. Now think about Modern Monetary
| Theory.
|
| I see an attempt at distinction without a difference.
| whakim wrote:
| People kind of are rioting, though. The election of Donald
| Trump (and the rise of populist parties across Europe); the
| January 6th capitol riot; the Black Lives Matter movement -
| whatever you think of these things, they're all connected at
| some level to a deep-seated feeling of social injustice.
| Perhaps we're only at the start.
| petre wrote:
| No, they're just going to try and cheat the system because
| 'everybody does it'. It sends the wrong message that
| corruption is okay.
|
| I like the photo of Ilham Aliyev and his wife though. He
| looks like a villain from James Bond movie.
| rcMgD2BwE72F wrote:
| It's unsustainable, so people are waiting for the system to
| collapse. A few will riot, some will try to accelerate the
| collapse and benefit from it, of course, but most will wait
| and see.
| maybelsyrup wrote:
| I had a very similar thought. Kinda funny if it weren't so
| bleak.
| dmje wrote:
| Yeh, this is it. Soma for the masses in the form of Netflix,
| cheap fast food, booze, legal drugs...
| Igelau wrote:
| > booze
|
| YMMV, but I'm 2L deep on local beer and it's not making me
| trust The Man yet.
| salawat wrote:
| Are you out in the streets, or looking for the truth in
| the bottom of a bottle?
|
| If it isn't the former, the plan is working technically.
| xboxnolifes wrote:
| The man doesn't care if you trust him as long as you
| aren't getting in his way.
| cto_of_antifa wrote:
| Deep
| augstein wrote:
| Without saying this is only good or this is only bad, I
| honestly think we have reached a level of general wealth, e.g.
| enough to eat for everyone and enough to endlessly distract
| everyone (TV, social media, games, etc.), that most people
| won't really get worked up by such things anymore.
| derEitel wrote:
| I recently learned that my go-to park in Berlin, Gleisdreieck
| Park, was supposed to become an Autobahn in the second half of
| the last century. Protests have stopped it finally in the 90s
| [1]. Nowadays, Berlin is enlarging the Autobahn eventually
| leading to the removal of night clubs and nature. Why is the
| protest so small this time?
|
| [1] German only:
| https://de.wikipedia.org/wiki/Park_am_Gleisdreieck
| gerdesj wrote:
| About 40 years ago (aged 10) I watched a hedgehog wander
| around a grassy area near the Brandenburg Gate. If you
| recall, that monument was part of the delineation between
| East and West. The hedgehog was walking on a minefield. Of
| course it was too small to set off anything but even now I
| remember it.
|
| I was a British Army brat and we were stationed in
| Rheindahlen near MG at the time. The Berlin Corridor was
| pretty grim. It was a long straight concrete road with barbed
| wire fences on both sides. At the Berlin end we parked up in
| a large concrete plaza and presented passports through a
| metal hatch. Then we were allowed into the city. Berlin in
| 1980. I really wish I was older and could give a better
| impression of the place at the time but there are probably
| plenty of writers who can do the same and far better. It
| seemed to me at the time to be the same as any other (West)
| German city but a bit bigger! I think we were allowed a short
| trip to the East side via CP Charlie.
|
| The Berlin I visited back then had bigger fish to fry than a
| contentious autobahn!
| Melting_Harps wrote:
| > In history books, you get a sense sometimes that there were
| eras in which stuff like this sent people into the streets in
| rages. In which governments were voted out or overthrown, in
| which meaningful legislative responses were made. Or, you know,
| riots.
|
| I think your somberness comes from an idealized, perhaps even
| fanciful look at the Human Condition. Personally speaking riots
| and even street demos against this are not what is needed here,
| but rather a significant amount of Human Capital into opting
| out of this system and creating a viable alternative.
|
| Your pessimism is a symptom of a much bigger problem, not the
| source of the illness. Once you realize that you cannot reform
| this system you will be able to re-direct your energy toward
| that end and maybe find solace in the fact that we still live
| in the best time to be alive, if only because the amount of
| possibilities.
| emerongi wrote:
| It is definitely weird. It might be the fact that the average
| person today is so far removed from the events and their life
| just keeps going. Why expend energy on rioting when everyday
| life is fine? We all have a ton of other stuff to do.
|
| On a sidenote, this is why I always preferred Brave New World
| over 1984. Easier to keep the population in control by keeping
| them satisfied.
| monkeybutton wrote:
| Every day life is fine enough, and the majority has something
| to lose if they do act out. That threat to take what people
| have away is what works.
| tayo42 wrote:
| A riot is just going to make my life certainly worse for the
| slight chance of making someone else's life worse for reasons
| that really don't effect me.
| basisword wrote:
| They've sedated us. Compared to the past you mention we live
| long lives, work comfortable jobs, have all we can eat media at
| our finger tips and therefore aren't all that affected by the
| dodgy dealings of the elite. We're comfortable enough with too
| little to gain through uprising. For any change against the
| elite to take hold you need a large group to rise up against
| them - and even the poorest amongst us in the west have
| smartphones and the other trappings of a comfortable enough
| life. Why risk losing that or facing any discomfort at all when
| we can just get on with things and ignore the corruption?
| amelius wrote:
| https://en.wikipedia.org/wiki/Bread_and_circuses
| stjohnswarts wrote:
| what's on the other side of taking down a relatively (to the
| past) well run democracy? Do people actually think there's a
| utopia in anarchy? It will just be the rise of a different
| set of elites.
| acabal wrote:
| I've said to my friends that I think America is in a strange
| place in history, where bread and circuses have become
| industrialized enough to truly anesthetize people's political
| will.
|
| People have Netflix, the Internet, and video games all cheap
| and at the touch of a button; opioids, antidepressants, and
| illicit drugs are socially acceptable and easily obtained,
| sometimes even at a government subsidy; and almost nobody is
| physically _starving_ or lacking rudimentary shelter (even the
| poor in America are fed, clothed, and housed to an extent
| almost unimaginable compared to the shattering destitution
| experienced in most of human history).
|
| This was not the case in the past, when so many more people
| were subject to backbreaking manual farm and industrial labor,
| the real chance of starvation, malnutrition, or outright
| poisoning from unregulated industrialized food, cramped
| conditions in drafty, moldy buildings, grim disease, and worst
| of all, nothing to distract you from it all. One's free time
| was spent thinking about how unfair it all was, not watching
| TV. When people are stuck at the bottom of Maslow's pyramid,
| they have nothing better to do then get mad and start rioting.
|
| But as long as the bread and circuses continue to be effective,
| the will to riot in the streets is gone. Who cares if a
| billionaire sneaks in a second yacht on the side? I can just
| open a bag of Doritos I bought for pennies and switch to the
| Kardashians. The strange thing is, would we not consider this
| positive progress?
| fwip wrote:
| A lot of people also have, arguably, less control over their
| circumstances than ever before.
|
| Many Americans are effectively wage-slaves - unable to quit
| their jobs, because they rely on the income and have nearly
| no savings.
|
| Rent has to be paid. Food has to be bought. Car insurance,
| taxes, dentist appointments - you can't stop making money,
| because you can't stop paying money.
|
| Moving costs an up-front investment that you don't have. Land
| is expensive, and even if you had the skills to build your
| own lodging, it has to be up to code.
|
| Pivoting to self-employment might seem easy in the age of
| Uber, but the reality is that it is incredibly difficult to
| earn yourself a living without playing by somebody else's
| rules. In the past, you could decide to earn a living as a
| fisherman simply by fishing and selling your catch. Handy
| with a hammer? Supplement your income on an ad-hoc basis by
| helping out your neighbors.
|
| The stress of dealing with everyday life can be so
| overwhelming that the only thing a person has juice left for
| at the end of the day is turning on the television, scrolling
| twitter, and eating those Doritos. And that television (and
| even twitter) isn't telling you any ways out of the
| invisible, ubiquitous cycle you're stuck in.
| qeternity wrote:
| Brilliant comment, my sentiments exactly.
|
| Just to add on: I also believe that this is why we see virtue
| signaling so strongly today. The impact of one's actions is
| quite secondary, for all the reasons you mention. So the
| illusion of change is just another circus for the mind to
| pass another hour.
|
| I still think we live in the greatest point in time in human
| history, but this is a super interesting and equally
| concerning possibility.
| xtracto wrote:
| And it's not only in the USA. For the last 15 years I have
| seen my country Mexico fall deep into violence, killings,
| narco state, blatant corruption and abuse from the people in
| the government.
|
| And nothing happens...
|
| Time and time again someone I the "high society " gets
| killed, there are a couple of marches and everything stays
| the same. It's as if the actual majority of the population
| was fine living in this shithole.
|
| It's so depressing.
| cblconfederate wrote:
| Bank secrecy is as old and nefarious as switzerland, the public
| already assumes that this thing is happening and that power
| comes with corruption (or else why would people want power).
| For political parties to demand equal access to these tax-
| avoidance instruments is obviously politically a non-starter.
| The current capitalism/power complex puts everyday people on a
| treadmill where they wish to become the ones who can one day
| avoid taxes, rather than demand this to stop now. Therefore the
| loopholes keep shifting arount the globe. Taxation is what
| separates the plebs from the elites
| ceilingcorner wrote:
| I think it's because most people actually don't want to pay
| taxes. They understand that the rich are able to go offshore
| and are somewhat jealous of them. But people want access to
| this, they don't want to participate in some kind of class
| warfare against a group they want to be a part of.
| rsj_hn wrote:
| > In history books, you get a sense sometimes that there were
| eras in which stuff like this sent people into the streets in
| rages.
|
| Read better history books. A bunch of people yelling into the
| air is not how change is effected.
|
| Really the culprit here is the French revolution, back when
| things were physically rooted so if you could storm the palace
| and burn your debt the debt would really be gone. All the
| French organs of power were located in this city filled with
| seething people. But that is not the world we live in today. If
| you storm the whitehouse, you just trespassed on a famous
| building, you haven't captured the center of power. If you tear
| down a statue, you just lose popular support, you are not
| overthrowing anything by attacking the physical statue.
|
| Power is not in buildings and it's not obtained by yelling.
|
| Moreover the resentment of incredibly privileged people
| complaining that they are not as privileged as someone else is
| not how you gain popular support.
|
| Yes, envy is still a powerful motivator, but the achillees heel
| of envy is that it's hard to unify a group of people who are
| driven by resentment. They constantly turn on each other. It's
| a very tricky thing, and if you are a would-be Napoleon, then
| shouting at birds isn't how you convert envy into a stepping
| stone for power.
| dragonwriter wrote:
| > In history books, you get a sense sometimes that there were
| eras in which stuff like this sent people into the streets in
| rages. In which governments were voted out or overthrown, in
| which meaningful legislative responses were made. Or, you know,
| riots.
|
| We've had people in the streets in rage, riots, and legislative
| responses to lots of things recently, though not the things
| that tend to animate the upper-middle class tech-libertarian
| crowd, which is out of touch with the day-to-day concerns
| of...pretty much everyone else.
|
| Whether those responses will be _meaningful_ is disputed in the
| moment and will only be clear with historical distance.
| quijoteuniv wrote:
| The really great victory of the rich is that they convinced
| half of the planet to defend them.
| jerf wrote:
| "At best, these stories get a good chunk of the airwaves for a
| couple of weeks, and then it's on to the next thing."
|
| This is the true power of the media. It isn't whatever lies or
| truths they may tell, though those are impactful in their own
| way... it is the way they decide what we think about at all.
| The true power of the media is to inflate some tiny incident
| that happened to one person to a national-scale, multi-week
| crisis... and to be able to take national-scale, multi-decade
| crises and bury them to the point that it's right down there
| with "conspiracy theories" to think about them.
|
| If you pay attention, you can see this sometimes in action.
| They'll push a story expecting a certain reaction, but if they
| don't get the reaction they expect, _poof_ , it's gone. There's
| always a huge pool of stories to draw from, far larger than
| they need to send any message they want without having to
| necessarily _lie_ at any point. They just have to control the
| spotlight of attention to get the results they want.
|
| Sometimes HN denizens talk about breaking out of the filter
| bubble. This might be a better way of thinking about it...
| instead think of it as breaking away from the attention
| spotlight being pushed on you by the media. Almost the entire
| world is taking place outside that spotlight.
| TrispusAttucks wrote:
| I used to have so much faith (naively perhaps) in the major
| news networks. Maybe they used to be bastions of truth but I
| feel that is not the case. They are just a mouth piece of the
| elites at this point.
|
| They have us divided and fighting each other so we're too
| busy to see the real cause of our discontent.
|
| So much truth has been censored and replaced with lies in the
| last 2 years. But no one is calling them on it? There isn't
| even an apology or a retraction.
|
| It's not news.
|
| It's propaganda.
| zxcvbn4038 wrote:
| Real news is expensive, that is why so much of the news has
| turned into opinion pieces - it costs almost nothing to
| publish people's opinions but it grabs eyeballs for
| advertisers just as well as real news.
|
| When it's not opinion pieces they are usually promoting
| someone's book or hyping up some Lifetime special.
|
| Even before reporting really started circling the drain I
| always noted how wrong the news got technology stories, and
| I wondered if all the other topics were just as off.
| TrispusAttucks wrote:
| Yep, and the opinion pieces are just advertisements in
| disguise. So who are the advertisers paying for the
| content. They don't care about truth. It's just about
| profit or control.
| OnlineGladiator wrote:
| > Even before reporting really started circling the drain
| I always noted how wrong the news got technology stories,
| and I wondered if all the other topics were just as off.
|
| https://www.epsilontheory.com/gell-mann-amnesia/
| derefr wrote:
| The media needs _something engaging happening_ to have
| something to continue to report on. (Even if that thing is
| just public figures reacting to a thing.) If they lob a
| bombshell and see it explode, but there are no further
| consequences to that explosion -- no "sequelae", as the
| medical profession would put it -- then they can't very well
| continue to report on the explosion.
|
| What makes further consequences happen? Powerful people
| taking an interest. The media is the fourth estate, but only
| insofar as their actions trigger reactions in the first-
| through-third estates. For a news story to "continue to
| happen", it needs a _patron_ in a position of power to
| actually care about what was reported, and act in response,
| in a media-visible way. News coverage is, and always has
| been, a feedback loop between journalists and the public
| figures they cover.
|
| Which implies that if something is a "taken as a given"
| practice among pretty much everyone with power, then
| reporting on it won't get any powerful patron riled up, and
| so won't get anything done to feed back into the news cycle.
|
| Democracy continues to function, separately from all this;
| voters read the news, get angry, and pressure their
| congressman, who then pushes for change in the house, causing
| ripples in the bureaucracy. But none of that is able to be
| framed in an incendiary "continuing coverage" format, because
| there is no heroic narrative to democracy, only the snowball
| effect of small actions -- so the regular news media doesn't
| attach to it at all, so it seems to just drop off the face of
| the Earth.
|
| But it's still happening; it's just happening in a way you
| can only perceive with "I watch C-SPAN" glasses on.
| leppr wrote:
| "Representative democracies" train people to be apathetic.
|
| Since birth they are made to believe that the miraculous
| democratic republic they live in gives them agency, and that
| the reason they actually don't have agency is because their
| fellow citizens are stupid and can't vote for the right things.
|
| The result is a feeling of justified helplessness. There's no
| feeling of outrage at the greedy tyrannical ruling class,
| because after all either you or your neighors "chose" them.
|
| And if taxation laws are unjust, it's your neighbors' fault.
| They voted for _red_ while _blue_ would obviously have your
| best interests in mind. Nevermind the fact that both _red_ and
| _blue_ are part of the same wealth and social class, who
| benefit from the same laws.
| aero142 wrote:
| Democracy is very successful in preventing political
| violence. Violence is incredibly destructive to people's real
| daily welfare.
| breakfastduck wrote:
| It's also incredibly successful in destroying social
| mobility, causing people to be stuck in ever-increasing
| levels of poverty - which is pretty destructive to peoples
| welfare too.
|
| Not to mention it prevents political violence at the
| expense of causing extreme violence in foreign nations. As
| long as its not us, right?
|
| I would say with this that unfortunately democracy =
| capitalism in the world we live in. And its really
| capitalism that causes those things, rather than democracy
| itself. I dont want to give the impression I hate democracy
| as an idea, just how we've implemented it.
| geysersam wrote:
| > It's also incredibly successful in destroying social
| mobility.
|
| I find it difficult to agree with this sentiment. Social
| mobility might have decreased in the last four decades.
| But in the longer perspective there has never been a more
| egalitarian and meritocratic social structure than in our
| time. And that structure exists mainly in the democratic
| states of the world.
| nichohel wrote:
| The idea that there are "ever-increasing levels of
| poverty" in western democracies is transparently false.
| Would you like to try to provide some evidence for that?
| dragonwriter wrote:
| > "Representative democracies" train people to be apathetic.
|
| Is there any evidence that there is any system of government
| that does so _less_?
| jimkleiber wrote:
| So what's better?
| leppr wrote:
| Personally I think Democracy could be nice. I think there
| are systems of governance that can allow everyone to have
| agency on their life without necessarily having to be rich
| enough to passport-shop.
|
| Calling our democratic Republics simply "Democracy" is
| another cool helplessness-inducing newspeak trick. That
| language implicitly positions the system on the extreme-end
| of citizen-agency, so logically everything else must be
| more authoritarian.
|
| In fact, assuming you live in one of these so-called
| "Democracies", think about how much your country's laws and
| policies impact you, and then think how much effort and
| input you provide to deciding those laws and policies. The
| ratio is most likely ridiculous.
|
| We always say "direct democracy doesn't work because people
| don't care about every issue", but there's an universe of
| possibilities between Democratic Republic ("chose between
| red and blue every five years") and simplistic direct
| democracy ("country-wide majority vote on every government
| decision").
| jimkleiber wrote:
| I'm open for alternatives and improvements on what we
| currently have. I still don't feel very clear after
| reading what you just wrote. I don't think the US has a
| pure representative democracy (citizens vote directly on
| many issues) and I also don't think representative
| democracy inherently leads to a binary red/blue decision,
| as I think number of political parties is often
| determined by the particular rules of the election
| process.
|
| Do you have any suggestions on how to improve the system?
| tw04 wrote:
| > In history books, you get a sense sometimes that there were
| eras in which stuff like this sent people into the streets in
| rages.
|
| Not always, but generally that only happens when enough people
| can't feed their kids. We're still too comfortable to risk it
| all. There's also the issue of mass surveillance which can kill
| an uprising in the cradle.
| JohnJamesRambo wrote:
| We have plenty of food and tv to watch and our phones to look
| at. Complacency is so high. Someone that is hungry and bored
| finds taking to the streets for a riot compelling because they
| have nothing to lose.
|
| I find this complacency we have bizarre because the average
| working poor person seems pretty miserable looking at their
| phone and eating fast food. The Panama Papers could offer clues
| for why they work so hard and never seem to have a single penny
| at the end of each month after the bills are paid. But the Big
| Mac and the Juul Pod and their Facebook feed makes them too
| tired right now to care...there's a new show on Netflix a
| friend told them about and maybe that will make them happy for
| a few hours.
| carlhjerpe wrote:
| One thing I'm curious about is if billionaire money is
| actually worth the same as our money, it seems like a sink.
| Once enough money is in the same place, moving it causes
| impacts that could devalue it. I mean you can buy cool
| boats(ships) and never lift a finger again in your life, but
| it's not actually usable on the scale we think right?
| sjtindell wrote:
| It definitely is. Jho Lo is a great example of this. He
| burned through billions, with a capital B, in only a few
| years time. Boats, houses, financing film projects (The
| Wolf of Wall Street, you can't make this up), gambling
| millions of dollars at a time on single hands of blackjack.
| A member of his entourage abandoned the life because he
| couldn't emotionally handle watching Lo spend more on
| bottle service at the clubs in a single night than his
| entire extended family would ever earn in their lives. I
| think most rich people are just relatively staid in their
| spending, despite the multi million dollar homes and all
| that.
| Igelau wrote:
| That's why you move it in weird ways. Like fine art and
| crypto.
| reedjosh wrote:
| That's what charitable foundations/trusts are about.
| gdubya wrote:
| "it ain't great, but it could be a lot worse..."
| pjc50 wrote:
| > how small a dent it seems to make in the discourse
|
| "The discourse" is increasingly unglued from any kind of ground
| truths. The pandemic has just made that far more obvious. It's
| just people refighting the same wars.
|
| > Or, you know, riots.
|
| The US had a huge number of riots over the last year, and
| violent (but as yet unarmed) protestors stormed the federal and
| some state capitols. (There was also _armed but not violent_
| protest, https://www.bbc.co.uk/news/world-us-canada-52496514)
| Several cities briefly had "autonomous zones" and at least one
| police station burned down.
| leppr wrote:
| Yes, and none of these riots were about anything related to
| the economy.
|
| In fact, it's precisely during this time that the Feds were
| hitting the printing press the hardest, directly increasing
| wealth inequality and thus, the US Black population being on
| average way poorer[1] and poverty indirectly being the number
| one cause of death, lowering US Black citizens' life
| expectancy more than US White citizens.
|
| And yet 0 riots or public outcry about that, while countless
| more Black people will die because of these policies than the
| few who die of police brutality.
|
| [1]: https://www.brookings.edu/blog/up-front/2020/12/08/the-
| black...
|
| _> In 2019 the median white household held $188,200 in
| wealth--7.8 times that of the typical Black household
| ($24,100)_
| SamoyedFurFluff wrote:
| Very few times does a riot legitimately change anything, even
| in response to great corruption. It's precisely why such times
| are historically noted. Things like civil rights, the end of
| slavery in America, gay marriage, and women's right to vote in
| America were all from _decades and decades_ of bureaucratic
| labor.
| C19is20 wrote:
| Well, just fancy having to even explain yourself with an "EDIT:
| Reading some replies....."
| playpause wrote:
| > "how small a dent it seems to make in the discourse, and in
| the world as a result"
|
| I used to think this. But now I think: maybe the 'dent' I've
| been looking for is essentially just excitement and hype, which
| isn't change. The narrative that change happens through the
| mass public getting angry, forcing politicians to respond, is
| overblown at best. I think the boring truth is that nearly all
| progress in this area (and there is progress) happens through
| countless bureaucrats diligently working for years on court
| cases and regulation changes to make it harder for people to
| get away with this stuff. For such bureaucrats, a leak like
| this is going to be relevant and valuable for years, long after
| the media has moved on. The people implicated in the leak
| didn't want the leak to happen, and there's a reason. Sure,
| most are probably too powerful to get prosecuted and put in
| jail, but it does curb their options for future shenanigans,
| and they will probably lose some money. Sanctions do work. I
| think it's probably always been this way too - the exciting,
| romantic parts of history (marches, revolutions) are the
| exception, we just pay more attention to them.
| duckmysick wrote:
| In a way, it reminds me of the aviation industry, where
| regulations are put in place because something happened in
| the past.
|
| At the same time, as regulation gets more complex, it creates
| new ways to be exploited. The same way more source code means
| more possibilities for bugs. The bureaucrats play a catch-up
| game and they are always at a disadvantage.
| maybelsyrup wrote:
| I like this in outline -- the notion that what you could call
| the "acute" effects (e.g. its impact on the news cycle) of a
| story like this may be more visible and less important than
| its "chronic" effects inside institutions, where people take
| more serious notice. (That's if I'm reading you right.)
|
| I guess what I'm less sure about is the inevitability that
| you're painting it with. Seems a bit "whiggish" [1], in my
| reading, if for no other reason than seeing brighter days on
| this front in the past than in the present and immediate
| future.
|
| [1] https://en.wikipedia.org/wiki/Whig_history
| freebuju wrote:
| > The narrative that change happens through the mass public
| getting angry, forcing politicians to respond, is overblown
| at best.
|
| It used to work. As recent as a couple decades ago at least.
| The Arab spring that swept Middle East and parts of North
| Africa in 2010s comes to mind.
|
| Protesting and going to the streets, depending on where you
| are in this world, feels more like a dying art today rather
| than the stuff of revolution we've associated them with in
| the past. Feels wrong just typing that.
|
| Maybe we've just become insensitive to it all and do not have
| the will to fight governments.
|
| Maybe our collective thoughts and ideas are more homogenous
| than ever before.
| foobarian wrote:
| It's very simple - we are well fed.
| PeterisP wrote:
| As the Romans said, "panem et circenses"; nowadays in the
| first world, even the relatively poor classes have access
| to a plenty of cheap entertainment and food; it's perhaps
| not _good_ but it 's enough to take off enough of the
| edge that people are merely angry but not so desperate
| (for the masses - individual exceptions of course happen,
| but they don't matter) to actually go ahead and risk
| their lives trying to change everything.
| chitowneats wrote:
| This is my thought as well. We've reached a plateau where
| the average individual's circumstances are so comfortable
| that violent political action just doesn't make sense
| psychologically. The pie is so large that, even though we
| are getting a smaller and smaller slice compared to the
| elites, it doesn't trigger the type of primal response it
| did in the past.
|
| Should we hope this continues? Probably. If the situation
| deteriorates to the point that revolution becomes
| palatable the result would be mass human suffering.
| munk-a wrote:
| As someone born in the eighties I'd mention that it has
| actually gotten less unthinkable that mass riots happen in
| the western world as I've grown up. If everyone's reaction
| to January 6th surprised you it's because when most of the
| middle-aged working folks (including the folks in the
| media) were growing up this was unthinkable. The Arab
| Spring happened "over there" and ditto for North Africa -
| it's only recently that we've had substantive protests
| domestically.
|
| The WTO always brings a decent sized chunk of protest when
| it comes - but the biggest protest in my memory is Occupy
| Wall Street which ended up being incredibly peaceful and
| polite and thus absolutely ignored by the media. The
| largest one before that was probably the '92 LA Riots which
| I was born just late enough to not notice.
|
| Most of the more media grabbing protests of my life time
| have actually been sports related - the Red Sox winning and
| the Stanley Cup Riot. I don't know how true your statement
| really is.
| notsureaboutpg wrote:
| The Arab Spring was an enormous failure though. It brought
| about the first ever democratically elected leader in Egypt
| and he died in prison earlier this year under the military
| govt that overthrew democracy. This is pretty much the case
| everywhere the Arab Spring was a thing.
| throw63738 wrote:
| It is not dying art. Protests are now part of
| establishment, and are protected by police!
| chitowneats wrote:
| The revolution will be sponsored.
| munk-a wrote:
| Obligatory Kendall Jenner Pepsi ad reference.
| newbie789 wrote:
| > I sometimes get the feeling that people are actually envious,
| sometimes even respectful of the ingenuity it takes to
| manufacture these schemes.
|
| I think this is an accurate assessment (at least for the US).
| One of the only logical reasons as to why we as a society allow
| this is that there are enough individuals that aspire to _be_
| these insanely wealthy folks that we make sure that these
| scenarios remain possible.
|
| Ironically, robbing your country and hiding your cash has
| become _the_ American dream. For example, if I were to say:
|
| "Aspiring to be like Elon Musk is genuinely the most pathetic
| way to spend a human life imaginable.
|
| His fortune is built on apartheid and all of the torture and
| death it entails. Yes, Elon Musk and his family should rightly
| be judged morally as being active participants in the system
| that tortured and murdered countless black Africans. The fact
| that his family (and the money that they extracted from South
| Africans) left South Africa as soon as segregation started to
| wane is indicative of this.
|
| He isn't some sort of hero or genius, or even supervillain.
| He's just managed to become what nerds masturbate to when they
| picture their (nonexistent) futures.
|
| Finally, the wealth that he holds is only his because of his
| staff figuring out how to avoid paying for your roads,
| hospitals, schools, parks, research etc. He is only rich
| _because_ you are not. To want to be like Elon Musk is like
| wanting to be a tumor attached to a nearly-dead host."
|
| Here's what will happen, because this is the internet:
|
| People with <0.00000001% of his net worth will jump in with one
| of a small handful of responses:
|
| (These are all paraphrased but you never know, some might be
| verbatim)
|
| 1. I bet he actually does pay fair taxes...
|
| 2. Actually, I think his family didn't profit from apartheid
| because...
|
| 3. Because you've used emotionally charged language in this
| post, I'm going to treat everything written here as patently
| false. While my decision to ignore what you've said is entirely
| based on my emotions, it is your fault for not being nice
| enough to me/Elon.
|
| 4. Fuck you. You owe him respect because [insert business here]
| has or will save the world someday, or not. It's up to him. And
| while I'm not advocating for being afraid of him, in the back
| of my mind I get anxious about him being displeased every time
| I see him criticized and the best way to assuage that anxiety
| is to dunk on a stranger.
|
| 5. I don't think we should use Elon as an example here because
| he's such an easy target. The fact that he has so many "haters"
| is, to me, proof positive that he's a saint. In fact, since
| criticizing him makes you a hater and everything haters say is
| False (as in the Boolean value), no criticism of him is True.
|
| 6. Any combination of the above + "I am/know somebody who is a
| Tesla shareholder, therefore it's good"
|
| While it might seem that I've meandered away from the topic at
| hand, I haven't. The weird impulse to defend the uber-wealthy
| is precisely why we allow billionaires to run amok.
| bigodbiel wrote:
| Look no further than Australia. Life is good. That is all.
| mschuster91 wrote:
| > In history books, you get a sense sometimes that there were
| eras in which stuff like this sent people into the streets in
| rages. In which governments were voted out or overthrown, in
| which meaningful legislative responses were made. Or, you know,
| riots.
|
| > But I look around after reading those books and wonder what
| makes us so different.
|
| Quality of life improvements. Basically, ye olde historical
| riots yielded _immediate_ and _noticeable_ improvements for the
| people: rollbacks of food prices (there were a couple of riots
| over beer price hikes!), shorter workdays, work-free days,
| workplace safety measures, the likes.
|
| In modern days, outside of affordability of healthcare, systems
| are so ossified that even a violent revolution won't make much
| actual change. Just look at BLM - decades of peaceful and
| finally violent protests and yet, nothing much has materially
| changed as a result. So why should someone take part in a riot
| and risk arrest when there is no hope of stuff changing for the
| better?
|
| Another big factor is decades of anti-union brainwashing. Hard
| to organize a mass protest when anything even remotely tied to
| collective organization got branded as communist/anti-patriotic
| and thus as "bad, avoid it" and that was indoctrinated from
| school age onwards.
| vlunkr wrote:
| It sounds real condescending to say "it's weird to have to say
| this to such a smart crowd."
| jdavis703 wrote:
| The wealthy hiding their wealth doesn't matter until we have a
| wealth tax. The current system is based on income, sales and a
| little bit of property taxes (which is hard to hide.)
| james_burden wrote:
| 1. That amount of wealth is highly abstract and hard to get
| worked up about. 2. It's not blasting you in the face every day
| on twitter/facebook. 3. The useful idiot class (most peeps that
| respond on sites like this) always just talk about OmG WhY DoNt
| OthEr PeoPle Do StUfF???!?!?!
| stakkur wrote:
| To paraphrase Seneca--the world has always been this way. This
| is not 'new information', and I'd say a meaningful portion of
| humans know this. The question is--so what? There is power, and
| manipulation of it. You are not in control of it. You are in
| control of what you do, though.
|
| And as some in this 'smart crowd' will tell you, large and
| amoral tech corporations are a key reason we have much of the
| artificial wealth and technocratic elitism we enjoy and speak
| from.
| panta wrote:
| In "Amusing Ourselves to Death" Neil Postman hypotesizes that
| people are increasingly anesthetized by their addiction to
| amusement, as pushed in increasing amounts, and duller form, by
| the media. Now there are only armchair riots, our pitchforks
| are the virtual keyboards on our mobiles.
| throwmeawsoftly wrote:
| Change happens when the necessary force is applied. Sometimes
| this takes the form of violence, other times of pressure of
| some other lever of whatever system is in place, in any case it
| requires people investing in it. Now, the notion of people
| "fighting for what's right" is romantic at best. People invest
| (read: act, put in time / opportunity-cost, resources, take
| risks, etc.) with the same rationales of any investment: is it
| worth to them specifically in terms of costs/risks/success-
| likelihood/payoff? When it comes to these things, the answer is
| just "no" for too many so that the critical mass required is
| not reached. We are at a point when most people in first world
| countries are just either comfortable enough or think have too
| much too lose (or both) that it takes stuff seriously
| threatening their way of life at scale to trigger any reaction
| with a relevant chance of real impact. As long as the bad stuff
| is either very-bad-just-for-some or not-bad-enough, basically
| we'll see people (and lobbies, and companies, etc.) get away
| with anything.
| nobrains wrote:
| Depends on what the people do with it. In Pakistan, the ruling
| prime minister was deposed due the investigations initiated by
| the panama papers, and the new prime minister who came in after
| him, stuck to his anti-corruption narrative by getting rid of
| people in his cabinet who were proven corrupt.
| TheChaplain wrote:
| I don't mind people being filthy rich, but I'd rather see that
| they invest in their country instead of moving them off-shore.
|
| If I had such level of riches I'd invest in stocks, companies,
| research, properties etc.. I'm certain it would open more job
| opportunities.
| Hokusai wrote:
| > I don't mind people being filthy rich
|
| You do not like that they move money offshore, and that is for
| a good reason, the super rich have so much resources that they
| can unilaterally distort the economy. The more concentrated the
| wealth the more fragile is the economy and the more is
| dependent on the mood of a few lucky people.
| helloguillecl wrote:
| The resources actually _don 't_ go anywhere. You can have
| deposits and investment in many countries owned by these
| shell companies.
|
| There are mostly used to conceal the actual owner of those
| assets, if nothing else.
| 8ytecoder wrote:
| They usually do. Even money parked in remote islands in
| companies end up as investment in their home countries. Except
| now with another layer to hide their identity and ability to
| dodge taxes.
| ur-whale wrote:
| > they invest in their country
|
| Why?
|
| Their country might be a terrible place to invest in.
|
| Also: define what "their country" actually means.
|
| I think a much better take on this would be "I'd rather they
| invest their money in productive endeavors, that benefit
| society and/or humanity in general".
|
| On other words, I agree with your general sentiment (the money
| should be put to good use), but find the "their country" part
| completely weird.
| gremIin wrote:
| Why would they? In our global world, there is very little tying
| the rich to the countries they amassed their wealth in.
| wallace01 wrote:
| how come all the players in the pandora papers are from any
| country but the US?
| ur-whale wrote:
| An excellent question.
| esarbe wrote:
| This is so annoying.
|
| These people got rich by living in a society that gives them
| language, concepts, ideas, a rich foundation of knowledge to draw
| from, social stability. All this requires a social contract whose
| benefits they are willing to reap but whose costs they are quick
| to discard.
|
| I think the German constitution hat something the lines of
| "Eigentum verplichtet", roughly translated "property obliges".
|
| It's really a shame that these gentlepeople that benefited so
| much from a stable society are willing to go to such lengths to
| keep society from their fair share. And that they don't even have
| any immediate need for the wealth their are hiding is all the
| more frustrating. This is all done for the sake of a bigger
| number on a virtual accounting sheet, not because it is required
| to create anything of value.
|
| This money could instead to productive purposes; education,
| rehabilitation and reintegration of criminals, child care,
| rewilding of abandoned industrial wasteland, the list goes on an
| on and on.
|
| Instead it's hidden in the most convoluted financial constructs,
| all the while benefiting people - lawyers and banker and yes,
| also software engineers, I know because I've earned my pound of
| flesh - that themselves have ambitions to 'become rich', as if
| that were of any use in itself.
|
| It would be only half as enraging if ordinary people that are
| barely able to just scrape by on a full time job were in a
| position to make use of such shenanigans. I guess that would
| almost make it 'fair'. But as it is, "tool" like these allow for
| superwealthy people to have a lower tax range than your regular
| car mechanic or plumber or service employee.
|
| And this just breaks it for me.
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