Posts Tagged ‘Delaware’

US Plutocrats: Delaware, Not Panama

April 8, 2016

I long said that the USA was the world’s number one tax haven, followed by Great Britain. And this is exactly why these two countries are the seat of global plutocracy. (London boasts that it is the world’s number one financial place, ahead of New York.) The New York Times in “Need to Hide Some Income? You Don’t Have to Go to Panama”, April 8, 2016:

“For wealthy Americans looking to veil their assets and shield some of their income from taxation, there is no need to go to Panama or any other offshore tax haven. It’s easy to establish a shell corporation right here at home.

“In Wyoming, Nevada and Delaware, it’s possible to create these shell corporations with virtually no questions asked,” said Matthew Gardner, executive director of the Institute on Taxation and Economic Policy, a nonprofit research organization in Washington.

In some places, it can be more difficult to get a fishing license than to register a shell company. And it doesn’t cost much more.”

Delaware Is The World’s Pluto Center. 285,000 Companies Are Registered In That Delaware Building Alone.

Delaware Is The World’s Pluto Center. 285,000 Companies Are Registered In That Delaware Building Alone.

Delaware allows companies to shift the seat of their business and their profits to Delaware, where, conveniently, there is no tax.

Speaking of the Panama Papers, “This is just one firm [Panamanian Mossack Fonseca law firm] in one place,” said Gabriel Zucman, an economist and the author of “The Hidden Wealth of Nations: The Scourge of Tax Havens,” “So it cannot be representative of what’s happening as a whole in the world.”

“But Mr. Zucman, who estimates that about 8 percent of the world’s financial wealth — more than $7.6 trillion — is hidden in offshore accounts, said another reason was that it is so simple to create anonymous shell companies within the United States.

Wealthy individuals and businesses that want to mask their ownership can conveniently do so in the United States, and then stash those assets abroad.

Yet while the United States demands that financial institutions in other countries share information about Americans with accounts overseas, its reciprocation efforts fall short, critics say.

“You see a ton of wealth in tax havens in Switzerland and the Cayman Islands that is owned by shell companies that are incorporated in Panama or in Delaware,” he said. “The bulk of this wealth does not seem to be duly declared on tax returns.”

The Institute on Taxation and Economic Policy in “Delaware: An Onshore Tax Haven” observed that the state’s obscurity, combining with a loophole in its tax code “makes it a magnet for people looking to create anonymous shell companies, which individuals and corporations can use to evade an inestimable amount in federal and foreign taxes.”

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Not to think the New York Times is going against the branch on which it sits, plutocracy. The preceding extracts were hidden away from the electronic front page. What we found on the front page was Krugman going all-out against Bernie Sanders in Sanders Over The Edge.

A good way to say bad things is to sound reasonable’ Krugman excels at that:

“…most liberal policy wonks were skeptical about Bernie Sanders. On many major issues — including the signature issues of his campaign, especially financial reform — he seemed to go for easy slogans over hard thinking. And his political theory of change, his waving away of limits, seemed utterly unrealistic.

Some Sanders supporters responded angrily when these concerns were raised, immediately accusing anyone expressing doubts about their hero of being corrupt if not actually criminal. But intolerance and cultishness from some of a candidate’s supporters are one thing; what about the candidate himself?

Unfortunately, in the past few days the answer has become all too clear: Mr. Sanders is starting to sound like his worst followers. Bernie is becoming a Bernie Bro.

Let me illustrate the point about issues by talking about bank reform.

The easy slogan here is “Break up the big banks.” It’s obvious why this slogan is appealing from a political point of view: Wall Street supplies an excellent cast of villains. But were big banks really at the heart of the financial crisis, and would breaking them up protect us from future crises?”

Actually Krugman is a specialist of trade, not banks. Bank specialists like Simon Johnson, have called for the break-up of the 21 biggest banks (which are recognized as special by the present US government).

Krugman detests Sanders saying Hillary has no clothes:

“It’s one thing for the Sanders campaign to point to Hillary Clinton’s Wall Street connections, which are real, although the question should be whether they have distorted her positions… But recent attacks on Mrs. Clinton as a tool of the fossil fuel industry are just plain dishonest, and speak of a campaign that has lost its ethical moorings.

And then there was Wednesday’s rant about how Mrs. Clinton is not “qualified” to be president.

What probably set that off was a recent interview of Mr. Sanders by The Daily News, in which he repeatedly seemed unable to respond when pressed to go beyond his usual slogans. Mrs. Clinton, asked about that interview, was careful in her choice of words, suggesting that “he hadn’t done his homework.”

But Mr. Sanders wasn’t careful at all, declaring that what he considers Mrs. Clinton’s past sins, including her support for trade agreements and her vote to authorize the Iraq war — for which she has apologized — make her totally unfit for office.”

Speaking of exhibiting extremely deep, vicious dishonesty, I sent the following comment, it was censored:

It was obvious, during the ramp-up to the Iraq war that the top leaders of the USA had lost their mental balance. The United Nations did not believe their lies and refused to give them an authorization to attack Iraq. Bush attacked, without a UN Security Council authorization, because he was supported by New York Senator Clinton. The invasion of Iraq by the US caused millions of people to die or being wounded. It brought the Islamist State.

Those who engineered this debacle should have been prosecuted for crimes against humanity. Suggesting they are decent, because they apologize, is to deny civilization has merit. Proposing to be led by them again is proposing to learn nothing from the past.

Specialists of banks long suggested to break big banks and big shadow banks (Simon Johnson, 2009). This is not a revolutionary proposition. Teddy Roosevelt broke big oil. When President Franklin Roosevelt came to power, he closed all the banks. That was much more revolutionary.

Global trade treaties enabled giant corporations to extend their monopolies to the entire world. This way, they escape local legislation. An example is the “Double Irish” Apple Inc. and many other corporations use. The CEO of Apple admitted that two-third of the profits of Apple were not taxed.

End of my comment. Krugman never mentions subjects such as the preceding with the angle I use. In his world, big banks, big trade, big bucks, etc. are absolute big goods.

Hillary is his “sis”, with a bit of luck, she will be grateful, and make him big something, some more. Heathens such as me, with their strident Clintonophobia, have no doubt “not done our homework” because, like Sanders, we are just reprobate school children of no intellectual merit.

Try not paying taxes, as big fishes do, if you are a little guy. You will be sent to jail, anywhere in the West. Plutocracy central? You bet!

Another, completely innocuous comment of mine to Krugman later in the day was also censored. Krugman’s post was entitled “Why Cruz is worse than Trump“. Exactly what I have been saying for five months. I guess the dear professor noble Nobel whatever, is not too keen to expose where he gets (some of) his inspiration from. These are sad, nervous days, for those who love plutocracy, the old fashion way.

Nine 5 Star Hotels In Bariloche, Argentina, & Golf Courses To Receive Obama & His Secret Service, In Style, Next Year

Nine 5 Star Hotels In Bariloche, Argentina, & Golf Courses To Receive Obama & His Secret Service, In Style, Next Year

In “USA Financial Extortion“, the essay linked to at the beginning of this essay, I pointed out the connivance between New York “Justice” and financial “Vulture Funds”. Meanwhile, the son and scion of one of the richest persons in Argentina was duly elected president, and Obama rushed to celebrate him, after 15 years of cruel, demented, anti-Krugman, anti-financial plutocracy rule in Argentina. That new Argentinian plutocrat and president is called Macri. He is a dancer. It turns out he was the name on shell companies in several places of the Anglo-Saxon plutocratic empire (such as the Bahamas). That was just revealed in the Panama Papers. Never mind.

Macri, as president, reduced the arrogant financial demands of the lower classes in Argentina: he needs all the money in the world, to pay his Vulture Fund friends in New York, whom Obama serves so well. So brand new president Macri threw more than one million people in poverty, by gutting their allowances: more than 2.5% of the total population of Argentina. Such is the way of the admirers of Reagan: make the rich richer, and the economy will reward you (thus, when Obama came to power, he saw the economy and its big banks were sick: so he gave all the money in the world to the big banks, and reduced the tax rates of the hyper rich by 20%, and now you can see the economy is right).

In any case, throwing more than a million to the poor house is glorious: not bad in a few weeks of assuredly very presidential work. Maybe Macri’s dad can propose newly retired super star noble Nobel Obama some 5 star stay in Bariloche, next year? Just an idea. What are friends for, among the world’s rulers, if not grateful?

Patrice Ayme’

USA Financial Extortion

July 6, 2014

Individuals (famous economists), and organizations that are profiting from the present oligarchic system cannot be too critical against what feeds them. One has to read beyond the mellifluous lines.

Here is The Economist, June 28, 2014:

“Share and share alike… America should also embrace the OECD’s efforts, already backed by more than 50 countries, to create a truly multilateral system in which tax information on residents’ accounts and certain investments is shared annually. For that to work, America would need to hand over data similar to those which it demands from others—something it has hitherto appeared reluctant to do. The financial superpower looks ever more a regulatory bully, setting rules it ignores itself.

Bullies Kill, Vultures Feed, Justice The Old Fashion Way

Bullies Kill, Vultures Feed, Justice The Old Fashion Way

Setting rules for others one ignores for oneself is the essence of viciousness.

The financial superpower looks ever more a regulatory bully?

The USA is a financial bully, and it started in 1944, when the USA tried to bully Lord Keynes himself (head of the currency commission at Bretton-Woods), into accepting the Dollar of the USA as the world’s reserve currency.

The fact that it started so long ago means that the bully’s institutions have evolved accordingly. A particular case if American justice, which finds American violence to be just: the case of the vulture funds is exemplary. Whoever stands in the way of American vultures is unjust.

Keynes wanted to use the International Monetary Fund to create “Drawing Rights” as needed, a solution Dominique Strauss-Kahn implemented to the tune of 450 billion dollars until his fateful encounter with the maid from hell, taken super seriously by New York “Justice” (until she proposed so many tricks to the officers in charge of “protecting” her, that, well, it was embarrassing, even for New York “Justice”).

Keynes resisted totally, so the government of the USA forged the documents that made the USA into the one and only financial superpower. When Saddam Hussein begged to differ, and started to use Euros, he was hanged. So the BNP executives, who have not been executed yet, ought not to complain too much, as The Economist astutely points out, somewhere else.

What is The Economist alluding to above? “… hand over data similar to those which it demands from others.” To the fact that the USA is the world’s largest tax haven for global plutocrats, while busy destroying all other tax havens. The destruction of Swiss banks and bankers is exemplary that way.

In other words, the USA sucks up capital from all over the world, by stealing other countries’ taxes (as it provides plutocrats, worldwide, to escape taxation, thanks to… Delaware).

Says The Economist in: “Tax havens, The missing $20 trillion How to stop companies and people dodging tax, in Delaware as well as Grand Cayman”: a lower rate on a broader base, combined with vigilance by the tax authorities, would be more efficient and would probably raise more revenue: America, whose companies face one of the rich world’s highest corporate-tax rates on their worldwide income, also has some of the most energetic tax-avoiders.

These reforms would not be easy. Governments that try to lower corporate tax rates will be accused of caving in to blackmailing capitalists. Financial centres and incorporation hubs, from the City of London to Delaware, will fight any attempt to tighten their rules. BUT IF POLITICIANS REALLY WANT TO TAX THE MISSING $20 TRILLION, THAT’S WHERE THEY SHOULD START.”

From the horse’s mouth: to tax the missing $20 trillion, start from London to Delaware… Exactly what I have been saying for years. The global financial exploitative mess is part of an Anglo-American imperial situation.

I have condemned the way “judicial” authorities in New York siding with the financial vultures therein. The Economist now agrees with me, and goes somewhat further, as it alleges state corruption. Here is an extensive extract from:

BNP Paribas in the dock: No way to treat a criminal. The French bank deserved a clobbering, but America’s legal system looks like an extortion racket.

BNP argues that it broke no European laws… That is true enough, to Europe’s shame… It is also true that the underlying transactions had nothing to do with America, but because they were denominated in dollars they had to be cleared in New York, which provided America’s lawmen with a toehold.

But the guilt of a suspect and the justice of a cause do not make a tribunal fair. And America’s system for pursuing errant banks, especially foreign ones, is anything but fair… BNP had little choice but to settle. Defeat in court might have led to the loss of its American banking licence—a death sentence for a big international bank. America’s prosecutors can also wield the threat of criminal charges against individual bankers.

Bank against the wall

Not only were BNP’s tormentors, such as Benjamin Lawsky, New York’s politically ambitious banking regulator, able more or less to dictate their terms, they also had an incentive to make the fine as big as possible because the agencies involved divvied up much of it among themselves. Mr Lawsky’s outfit gets $2 billion, four times its annual budget, which it will triumphantly deposit in New York state’s depleted coffers.

There are no meaningful checks on this process, let alone a plausible procedure for BNP to appeal. Bank bosses cannot even publicly criticise deals they agree to under extreme duress. No precedent is set and no guidance provided as to the limits of the law and the proportionality of the punishment.

So even if BNP fully deserves its punishment, the legal system that meted it out is closer to an extortion racket than justice. France’s economy minister, Arnaud Montebourg, has compared America’s pursuit of BNP to “economic warfare”. In other words, a bank that catered to mass murderers has had some success in portraying itself as a victim. Any process that can make BNP’s dealings with Sudan look anything less than shameful must be very flawed indeed.”

“Catered to mass murderers”? Is that not the story of the invasion of Iraq by the USA? Did BNP invade Sudan? Is the USA pursuing the invaders of Iraq?

No, the USA is using imperial might in ways very similar to Putin. (Putin also has laws and judges and Congress on his side, nota bene.)

Two months ago Argentina reached a settlement with the Paris Club, a group of government creditors.

On June 16th the Supreme Court of the United States decided twice in favor of NML Capital, a “vulture” fund (and subsidiary of hedge fund Elliott Management) that snatched dirt cheap bonds after Argentina’s 2001 default. The fund and its plutocratic owners have since pursued the country for the payment of all principal plus outstanding interest in US courts. For at least 1.6 billion dollars.

The ability of struggling countries to restructure their debts has been dented. Hold-outs everywhere have greater incentive to litigate; creditors who might accept exchange offers could see them gulped down by vultures, catered to by USA judges.

Those who play with fire to burn others may find where the concept of “backfiring” comes from.

Patrice Ayme’

USA: Den Of Thieves?

November 2, 2013

Hey, it’s not me saying it, but the New York Times! Finally waking up to the obvious. That’s courageous, as the greatest, and wealthiest of all the dens of thieves in the world, Plutocracy Central, is New York City itself.

John A. Cassara, a former special agent for the Treasury Department, wrote in the New York Pravda: Delaware, Den of Thieves? November 1, 2013:

“OUTSIDE of crimes of passion, criminal activity is typically motivated by greed.

As a special agent for the Treasury Department, I investigated financial crimes like money laundering and terrorism financing. I trained foreign police forces to “follow the money” and track the flow of capital across borders.

During these training sessions, I’d often hear this: “My agency has a financial crimes investigation. The money trail leads to the American state of Delaware. We can’t get any information and don’t know what to do. We are going to have to close our investigation. Can you help?”

The question embarrassed me. There was nothing I could do.

In the years I was assigned to Treasury’s Financial Crimes Enforcement Network, or Fincen, I observed many formal requests for assistance having to do with companies associated with Delaware, Nevada or Wyoming. These states have a tawdry image: they have become nearly synonymous with underground financing, tax evasion and other bad deeds facilitated by anonymous shell companies — or by companies lacking information on their “beneficial owners,” the person or entity that actually controls the company, not the (often meaningless) name under which the company is registered.

Our State and Treasury Departments routinely identify countries that are havens for financial crimes. But, whether because of shortsightedness or hypocrisy, we overlook the financial crimes that are abetted in our own country by lax state laws. While the problem is concentrated in Delaware, there has been a “race to the bottom” by other states that have enacted corporate secrecy laws to try to attract incorporation fees.”

The hypocrisy has, indeed, been colossal. The Clintons, for example, on the face of it, are among the planet’s most corrupt politicians. Just watch their fortune. Try to explain the difference with the king of Zimbabwe.

Yet, thanks to relentless propaganda, the Clintons are among the most admired American citizens. Why so? Because the same propaganda machinery  that make Clintons thrive is the one that makes made in USA plutocrats thrive, and if one can one’s soul grovel for the former, one sure will for the later.

This week we learn for example that the owners Google, Oracle and their kind would come down from the sky, and make Obamacare work. Saved by plutocrats again! So now, whatever good Obamacare is capable of doing, the indelible impression will be left, that the world’s richest men saved it. Verily those thieves are philanthropists!

The USA is plutocracy central. It can be seen in many ways. Not just the profusion of legal tax evasion and “optimization”. It can be seen statistically.

Consider this. France, or Germany, have a percentage of millionaires comparable to that of the USA. But the USA has, by far, a much greater number of multi-billionaires than France. Actually the USA has the greatest density of billionaires in the world.

It’s not that Americans are more industrious: otherwise French multimillionaire density would be lower. It’s that (legal) tax evasion is much greater in the USA… and it kicks in mostly for the hyper rich (who literally own the country and its politicians).

Many are the tricks, for example borrowing (against stock collateral; not taxed), instead of earning (taxed). Those tricks are tolerated, or even instigated, by the very political and propaganda machinery that the plutocrats control.

In truth the USA is the world greatest tax haven for the global plutocracy, and not just because of the foundation law and countless tax write-offs for the hyper rich inside the USA, to profit American multibillionaires. The USA also behaves like a philanthropic organization for worldwide multi-billionaires. The USA is plutophile.

The idea is simple. By allowing global plutocrats to evade taxes in the USA, then they will enrich the United States, and help further their American colleagues by reciprocating exclusive, mutually benefiting arrangements. That’s why formal requests for help from foreign IRS are blocked in the USA. Ultimately, the Pentagon and the intelligence system of the USA (NSA, CIA, etc.) protect Plutocracy Global.

The USA is the blackhole at the center of the worldwide galaxy of tax havens. That’s exactly why no light comes out. Of those worldwide tax havens USA billionaires themselves profit, through specially written tax laws (watch Apple, Amazon, and other major corporations paying only 2-3% tax, whereas the local bookstore pays 35% tax). Everybody knows about it, but don’t expect Obama Wealth Care to talk about it. Or Sugar Bowl’s Pelosi to evoke it.  When sitting on a branch, do not talk about saws. Or why the plutocrats who lead us by the nose don’t like to talk about equality.

Here is Mr. Cassara again:

“The Financial Action Task Force, an international body that sets standards for the fight against money laundering, terrorist financing and other threats to the international financial system, has repeatedly criticized America for failing to comply with a guideline requiring the disclosure of beneficial ownership information. The Organization for Economic Cooperation and Development, with which the task force is affiliated, has championed international standards for financial transparency, but cannot compel compliance.

Watchdog groups like the Organized Crime and Corruption Reporting Project, Global Financial Integrity and Global Witness say that anonymous companies registered in the United States have become the vehicle of choice for drug dealers, organized criminals and corrupt politicians to evade taxes and launder illicit funds. A study by researchers at Brigham Young University, the University of Texas and Griffith University in Australia concluded that America was the second easiest country, after Kenya, in which to incorporate a shell company.”

Now that Switzerland has been domesticated, it is high time to handle Delaware and Wyoming! Or, more generally, the entire tax code of the USA. However, there will be resistance.

Many behave as if New York City was the universe. And it’s all too true. Yet, let see what happens after we cut finance supreme down to size. From 25% down to 8% that is. Right now, finance is 25% of the profits of the economy in the USA. Historically, the average stands below 8%.

25% of the income of the state of Delaware comes from protection money paid by corporations.

Why has globalization become such a bad thing? Around a century ago, problems arose mostly from the excesses of exploitative colonialism. Exploitative colonialism, at its worst, caused the extermination of most of the natives of entire continents. That was as diabolical as diabolical can be, so it fully deserves to be described as rabid plutocracy.

After the termination of colonialism the old fashion way, complete with its more or less civilized imperial administrations, a much leaner form of exploitation arose. Old style administration chained the plutocrats: they had to play by the rules. After the departure of transnational (“imperial“) administrations, there were no more rules. Or, more exactly, the plutocrats made the rules. And here we are.

Cassara: Domestic law enforcement agencies are as stymied as foreign ones. In one case I worked on, American investigators had to give up their examination of a Nevada-based corporation that had received more than 3,700 suspicious wire transfers totaling $81 million over two years. The case did not result in prosecution because the investigators could not definitively identify the owners.

Anonymous corporations are not only favored tools of criminals, but they also facilitate corruption, particularly in the developing world. A recent World Bank study found that the United States was the favored destination for corrupt foreign politicians opening phantom companies to conceal their ill-gotten gains.”

That’s what we are at.

Globalization has become plutocratization. Time for a global correction. And that means striking where the head of the snake is. In the USA. Not just in Delaware, Wyoming and Nevada.

The top Democrats on the House Financial Services Committee, proposed legislation requiring United States corporations to disclose to the Treasury Department their beneficial owners. British Prime Minister Cameron, going further, announced that a planned national registry of companies’ true owners would be open to the public, not just to law enforcement.

Global plutocracy, especially of the Anglo-Saxon sort, was the force that made the difference with Nazism. Why? Because plutocracy rotted the head of Western civilization. The body stayed vigorous, and more than one million young Western soldiers courageously died on the battlefield… Civilization was saved, but is again encountering problems, actually the greatest ever. Yes, ever. Never was the biosphere in question before.

Not really understanding how that war was a racket (as the head of army of the USA, Major General Smedley Butler had put it eloquently years before the Second World War).

Right now mysterious kabuki wars against foreign co-conspirators have been replaced by an outright War Against The Poor. It’s all very simple. To get out of it, let’s treat Delaware as if it were Switzerland, a few years back.

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Patrice Ayme