On April 4th, media outlets around the world collaborated on arguably the most important news story of the decade. Süddeutsche Zeitung, a newspaper out of Munich, Germany received 11.5-million secret documents from an anonymous source which revealed the inner workings of a Panamanian law firm called Mossack Fonseca. The documents, which included emails and pdf files, dated back 40 years.
The leak, which has been dubbed the Panama Papers, detailed the efforts by some of the richest and most powerful people in the world to hide their money in tax havens in order to avoid being taxed on that money in their home country. The leak was so huge, that Süddeutsche Zeitung elicited the help of the International Consortium of Investigative Journalists (ICIJ)—a Washington-based non-profit organization—who coordinated a worldwide effort to decipher and interpret the content in the leak.
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The ICIJ brought together more than 400 journalists in over 100 media organizations in 80 countries in what amounted to the largest and most coordinated piece of investigative journalism in history. The sheer level of cooperation and secrecy is astounding. These journalist toiled away for more than a year without any of it being leaked.
The rich setting up shell corporations in tax haven regions is nothing new and probably shouldn’t take anyone by surprise. They hate paying taxes and have very successfully been avoiding it for decades. But the Panama Papers provide proof of the depth and lengths to which the wealthy will go to side-step paying their fair share.
In a world with continually rising inequality where most of the world’s wealth is concentrated in the hands of very few, this is a major story. Already, the fallout has been unprecedented. Iceland’s Prime Minister was forced to resign after it was discovered that he and his wife had billions of dollars tied up in shell corporations and bonds that cost Iceland millions in unclaimed tax money. In Spain, Industry Minister José Manuel Soria resigned after he was linked to offshore investments in the Bahamas and a company in the tax haven of Jersey.
UK Prime Minister David Cameron is also under scrutiny after ties to offshore companies were revealed and protesters are calling for his resignation. There is also evidence in the Panama Papers that suggest an elaborate money-laundering scheme linked to Russian President Vladimir Putin.
Governments around the world are destabilized as people are becoming more aware of just how deep this problem goes. In Canada, the CBC and Toronto Star were given exclusive access to the Panama Papers and they found that between $6-billion and $7.8-billion of revenue has been lost due to tax-dodging citizens.
However, with few exceptions, the Canadian media response to this story has been tepid. Both the CBC and the Star refused to release most of the names of the people named in the Papers, claiming that they had not actually done anything illegal and so shouldn’t be forced to face public scrutiny.
The National Post and Globe and Mail have a number of columns rushing to the defense of Canada’s rich, claiming that we should all just calm down. Placing money in offshore investments is perfectly legal, they tell us. This is common practice and we should all just carry on. There’s nothing to see here.
One column, by the Post’s William Watson, tells us that if we want to stop the hiding of wealth by the wealthy, that we should stop punishing them with burdensome taxation which robs them of their well-earned money. He goes so far as to say that 2015 “was a lousy year for billionaires” and that people such as Uber CEO Garrett Camp and Tim Horton’s czar Ron Joyce should be lauded for the “hugely disproportionate contributions” they make to society. As if terrible labour practices and shitty coffee should count as important contributions. People like Watson and others in the Canadian media seem to be so wildly out-of-touch with the realities of working class Canadians that they might as well be in outer space.
We should be outraged. Our media has failed us. Our politicians have failed us. Over the last four decades, while we weren’t paying attention, the proverbial revolving door between industry and politics was lobbying the government to secretly pass laws that made it possible for the rich to hide their wealth from taxation. The question is not whether this activity is legal, but whether or not it is moral.
We have been told, since before the Mulroney years of the late 1980s and early 1990s, that austerity on working people was necessary for our survival. That we could no longer afford things like adequate healthcare, or education, or old-age pensions. That we must raise the retirement age and tuition rates and take on jobs that work us harder for less pay and benefits. Even though, as a society, we are creating more wealth than has ever been known in human history, we are told that there is just simply not enough to go around.
The Panama Papers magnify what we have been told is not that big a deal. It sets in stone just how much wealth is being stolen from us by the rich and powerful. And it exposes just how rich and powerful they really are. Our long-held suspicions are not only being confirmed, it’s worse than we imagined.
In Iceland, Spain, Brazil, the UK, and Russia, there are protests in the streets demanding resignations of some of the most powerful government officials in the world. In the United States, the campaign of Bernie Sanders gains steam as people are finally tired of the rich running roughshod over the rest of us. In Canada, we act as though this is no big deal in a mixture of indifference and resignation usually reserved for inmates on death row.
As revelations and fallout from the Panama Papers continue over the next few months, we should all be paying attention. The stakes are as big as they can be. The destruction of our planet brought on by environmental catastrophes and the suffering by the many at the hands of the few from ever increasing inequality brought on by modern capitalism are the most important issues our species is faced with.