About those Pandora Papers

The International Consortium of Investigative Journalists (ICIJ) haws dumped its latest documentation about how the rich and politically connected hide their earnings and evade taxes, this one called the Pandora Papers:

A massive trove of private financial records shared with The Washington Post exposes vast reaches of the secretive offshore system used to hide billions of dollars from tax authorities, creditors, criminal investigators and — in 14 cases involving current country leaders — citizens around the world.

The revelations include more than $100 million spent by King Abdullah II of Jordan on luxury homes in Malibu, Calif., and other locations; millions of dollars in property and cash secretly owned by the leaders of the Czech Republic, Kenya, Ecuador and other countries; and a waterfront home in Monaco acquired by a Russian woman who gained considerable wealth after she reportedly had a child with Russian President Vladimir Putin.

Other disclosures hit closer to home for U.S. officials and other Western leaders who frequently condemn smaller countries whose permissive banking systems have been exploited for decades by looters of assets and launderers of dirty money.

 The files provide substantial new evidence, for example, that South Dakota now rivals notoriously opaque jurisdictions in Europe and the Caribbean in financial secrecy. Tens of millions of dollars from outside the United States are now sheltered by trust companies in Sioux Falls, some of it tied to people and companies accused of human rights abuses and other wrongdoing.

This news has prompted The New Republic to state that, "The Pandora Papers Show That South Dakota Is a Moral Sewer and Should Be Abolished," which is a rather interesting take on this matter.

Of course, the splitting of the Dakota Territory into 2 states was a blatantly political act in the first place, the Reopublicans of the day wanted 2 more reliably Republican seats, so there is some symmetry there.

It is interesting just how much South Dakota has thrown in its lot with the worst aspects of the finance system for decades, so its prominent position in tax evasion is no surprise.

One curious fact about this is the almost complete absence of any US people or US Businesses from the report.

There are two potential explanations for this:

1. The people and the businesses of the United States are law abiding folks who pay the taxes that they owe.
2. That this report was leaked by elements of the US State Security Apparatus, possibly with the goal of making life difficult for elements of the Russian and Chinese governments.

OK, there is ONE potential explanation for this, but all indications are that the documents are accurate, so it's best to proceed with with that you have. 

I find the discomfort of the rich and powerful to be personally gratifying, particularly the fact that got caught evading £300,000 in stamp taxes through the use of an offshore shell company. 

I'm hoping that they spend some time in dock over this.

I do think that there is a lot that the could be done, both by the White House and the Congress to reduced this phenomenon.