As big media continues to give very little time to the kind of deliberative review of tax issues that is necessary in a democracy and ideological think-tanks push out their videos and speakers trolling for a right-wing, anti-tax perspective (just read the Tax Foundation/Center for Freedom and Prosperity stuff), there are a few stalwart organizations trying to bring the core issues about tax policy into focus. Citizens for Tax Justice is one of them, and it held a briefing today (July 24) on "Tax Evasion and Incorporation Transparency: Show U.S. the Money".
Lloyd Doggett, the indefatigable tax haven foe in the House who has introduced a variety of bills that give corporate America and its lobbyists and think tanks the chills every year, spoke (unexpectedly) at the event to say that progress in the struggle against tax havens has been "very modest". BNA Daily Tax RealTime (July 24, 2009). Doggett seems to be an optimist though--he keeps reintroducing --with friends like Michigan's Sen. Carl Levin) some version of the Stop Tax Haven Abuse Act (H.R. 1265; S. 506 in this Congress). He says the House will hold a hearing on tax havens in the fall--wonder if by then UBS and the Swiss will still be hiding the names of those 52,000 Americans with hidden Swiss accounts?
(Doggett's probably exaggerating when he claims we've made even modest progress. Every time good public servants in Congress try to put even small provisions into the law, those that are in the pocket of the corporate giants (Big Banks, Big Insurance, Big Pharm, Big Oil) manage to cut it back or eliminate it entirely.) But as Doggett said at the meeting, the best way to get money is to go to those who aren't paying their fair share.
Baker's contribution was to highlight the UBS case (see prior ataxingmatter postings, most recently here). Like me, he wants the US to "hang tough" and get those 52,000 names. UBS is a criminal enterprise that violated the law and violated the qualified intermediary agreement that it had signed with our government for the sole purpose of satisfying its greed for more profits from assisting wealthy US taxpayers in hiding their money from the government. As Baker says--we should demand the names, and if that fails, we should deem the failure to provide them a breach of the deferred prosecution agreement and move forward with the criminal case.
Sarah Lewis of Tax Justice Network, formerly a private banker, has the most interesting statement in the piece about the culture of private banking:
"Advancing in such a culture is not unlike absorbing a sort of brainwashing; the mindset is that the client is god. In effect, I was told: 'We serve our clients and protect our clinets; we think as private bankers.' The pressure to bring in the $millions pervades the industry, compelling bankers to take risks others would never dream of, all with the belief that they can manage it and that they are in some way invincible." and this "The devious workaround is part of the private banking mindset."
Aside: why have we still not taken action on getting banks under control? We have to break them up and we have to regulate derivatives--all of them, without letting banks manipulate markets (and tax burdens) with customized derivative products. If we don't, we'll just get more of their systemically risky behavior and greediness in their favor and against the public good (as we are seeing in the NY Times story about their split-second advantage in trading that is allowing companies like Goldman to --well, steal is probably the best word-- from everybody else by timing the market trades) .
Robert McIntyre points out that the big mulinationals are playing us for fools, because our current tax system essentially pays them to move plants an djobs abroad or even if they just engage in trnasactions that makes it appear that they have moved things abroad, though they only move the profits (on paper) abroad. Citigroup, for example, has 427 tax haven subsidiaries. And as a result, US corporations carry a substantially diminished share of the tax burden compared to pre-Reagan times (which ultimately provides further benefit to their wealthy owners, of course).
The briefing materials include some impressive graphs (showing deposits in tiny island taxhavens, for example) and good, concise summars of various proposed legislation for dealing with the issue. Worth a read.
Recent Comments