News Release Archive - Economy and Business

“Pandora Papers” Experts: U.S. Now a Billionaire Tax Haven

“Pandora Papers” experts, Chuck Collins, author of The Wealth Hoarders: How Billionaires Pay Millions to Hide Trillions (Polity Books), and tax attorney Bob Lord, are available for comment on the Pandora Papers revelations.

Over the last three months, Collins has briefed members of the International Consortium of Investigative Journalists (ICIJ), on the “wealth hiding” systems in the USA. Articles interviewing Collins are now appearing in the British Guardian, El Pais (Spain) Infobae in Argentina, El Pais (Brasil), Univision (Mexico), and dozens of others.

On Sunday, the ICIJ released “The Pandora Papers,” based on 11.9 million leaked files. It exposes billionaires involved in aggressive wealth hiding and tax avoidance. It reveals, for instance, that “South Dakota now rivals opaque jurisdictions in Europe and the Caribbean in financial secrecy,” notes Collins.

“It is time for U.S. lawmakers to shut down the hidden wealth system that allows for such aggressive tax avoidance and the sequestering of wealth,” said Collins, who just wrote the piece “Why billionaires love to park their wealth in places like South Dakota” for Salon and is co-editor of Inequality.org at the Institute for Policy Studies. He added: “The U.S. has become the weak link in stopping global crime and wealth hiding. States like South Dakota and Delaware have morphed their laws to attract billions, sometimes illicitly obtained, from around the world. We in the U.S. should be embarrassed that we’ve become a magnet for kleptocratic funds.”

Collins’ book, The Wealth Hoarders, points to the role of enablers, what scholars call “the wealth defense industry,” in facilitating the use of dynasty trusts, off-shore tax havens, and anonymous shell companies. These wealth defenders include accountants, tax attorneys, wealth managers, and family office staff, that aid the super-rich in putting vast amounts of wealth beyond the reach of tax authorities. Collins also puts forward a comprehensive plan for shutting down the hidden wealth system.

Bob Lord is a Phoenix tax attorney, associate fellow at the Institute for Policy Studies, and legal expert on trusts, estate tax law, and explaining the complicated tax dodges deployed by the superwealthy.

Collins and Lord are available to comment on the latest revelations from the ICIJ Pandora Papers. Email: Contact Olivia Alperstein Olivia@ips-dc.org or Chuck Collins: chuck@ips-dc.org

Additional background resources:

Interview with Chuck Collins by International Consortium of Investigative Journalists:

How the world’s richest defend their wealth with help from a dedicated industry.”

By Bob Lord: “Beyond Lucrative: Jeffrey Epstein’s Billionaire Tax Avoidance Business” and “Taxing 7 Billionaires Could Pay For Third of Biden’s $3.5 Trillion Spending Package.”

IPS Policy Brief: “Dynasty Trusts: How the Wealthy Shield Trillions from Taxation Onshore,” by Kalena Thomhave and Chuck Collins.

How Milton Friedman Aided Segregationists in Quest to Privatize Public Education

NANCY MacLEAN, nancy.maclean@duke.edu

MacLean is William H. Chafe distinguished professor of history and public policy at Duke University and author of Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America.

Her new study for the Institute for New Economic Thinking is: “How Milton Friedman Aided and Abetted Segregationists in His Quest to Privatize Public Education.”

The essay reveals how the Nobel Prize-winning economist Milton Friedman allied himself with southern white efforts to defy the 1954 Supreme Court decision barring racial segregation in U.S. public schools. The iconic American academic hoped that the segregationists would advance his crusade to end public schools in the U.S. with vouchers for private schools.

“Friedman and his allies saw in the backlash to the desegregation decree an opportunity they could leverage to advance their goal of privatizing government services and resources. Whatever their personal beliefs about race and racism, they helped Jim Crow survive in America by providing ostensibly race-neutral arguments for tax subsidies to the private schools sought by white supremacists. Indeed, to achieve court-proof vouchers, leading defenders of segregation learned from the libertarians that the best strategy was to abandon overtly racist rationales and embrace both an anti-government stance and a positive rubric of liberty, competition, and market choice.”

MacLean concludes by bringing the story up to the present. “The sad fact of the matter is that improving education was never the true reason for free-market fundamentalists’ embrace of vouchers. As Friedman signaled in his first 1955 manifesto and argued for over a half century, school ‘choice’ was a tactic. The strategy it served was to ultimately stick parents with the full cost of their children’s schooling and the labor of finding and arranging it.

“He was as frank in addressing a meeting of the American Legislative Exchange Council (ALEC) four months before his death in 2006. Said Friedman: ‘the ideal way [to give parents control of their children’s education] would be to abolish the public school system and eliminate all the taxes that pay for it.’
“That,” writes MacLean, “is what today’s billionaire libertarian backers of vouchers, with Charles G. Koch in the lead, are keeping from the unsuspecting parents on whom the cause relies for electoral success, now Black and Latino as well as white.”

Report: $21 Trillion Financial Cost of Militarization Since 9/11

LINDSAY KOSHGARIAN, lkoshgarian@nationalpriorities.org@lindsaykosh
    Program director of the National Priorities Project, Koshgarian is co-author of the just released report: “State of Insecurity: The Cost of Militarization Since 9/11,” which states: “Over the 20 years since 9/11, the U.S. has spent $21 trillion on foreign and domestic militarization.

    “Of that total, $16 trillion went to the military — including at least $7.2 trillion for military contracts.

    “Another $3 trillion went to veterans’ programs, $949 billion went to Homeland Security, and $732 billion went to federal law enforcement. …

    “Spending on the DoD totaled $14 trillion over the last 20 years, including $1.9 trillion in funds appropriated specifically for wars through the Overseas Contingency Operations fund. Even though in recent years the fund was increasingly used for routine military expenses (or ‘base requirements’), this total falls short of estimating the true costs of the War on Terror. More than 70 percent of the Pentagon’s $14 trillion in spending over the last 20 years was for operations, purchasing and research and development. Operations and maintenance ($5.7 trillion) includes costs for operating, deploying, and maintaining weapons systems, including the military’s nearly 300 ships and more than 13,000 aircraft, and facilities, as well as training and other costs. Procurement ($2.8 trillion) includes the purchases and upgrades of major weapons systems such as ships and aircraft, as well as land vehicles, missiles, and ammunition.”

Global Billionaires See $5.5 Trillion Pandemic Wealth Surge

A one-off 99 percent levy on billionaires’ wealth gains during the pandemic “could pay for everyone on Earth to be vaccinated against COVID-19 and provide a $20,000 cash grant to all unemployed workers,” according to new analysis released today by Oxfam, the Fight Inequality Alliance, the Institute for Policy Studies and the Patriotic Millionaires. The organizations are calling on governments to tax the ultra wealthy who profited from the pandemic crisis to help offset its costs.

CHUCK COLLINS, NJOKI NJEHU, MORRIS PEARL, via Olivia Alperstein, olivia@ips-dc.org
Pearl, a former managing director at Blackrock and chair of the Patriotic Millionaires, said: “The surge in global billionaire wealth as millions of people have lost their lives and livelihoods is a sickness that countries can no longer bear.”

Njehu, Pan Africa Coordinator of the Fight Inequality Alliance, said: “We need to tax the rich for us to stand any chance of reversing the inequality crisis we’re in.”

Collins is the director of the Program on Inequality and the Common Good at the Institute for Policy Studies, where he co-edits Inequality.org.

He just wrote the piece “Global Billionaires See $5.5 Trillion Pandemic Wealth Surge,” which states: “The world’s billionaires have seen their wealth surge by over $5.5 trillion since the beginning of the pandemic in March 2020, a gain of over 68 percent. The world’s 2,690 global billionaires saw their combined wealth rise from $8 trillion on March 18, 2020 to $13.5 trillion as of July 31, 2021, drawing on data from Forbes. …

“The COVID-19 pandemic has pushed over 200 million people into poverty, according to estimates by World Bank researchers.

“United Nations Secretary-General Antonio Guterres urged governments to ‘consider a solidarity or wealth tax on those who have profited during the pandemic, to reduce extreme inequalities.’ The IMF and the World Bank have also called for wealth taxes to help cover the costs of COVID-19.

“Argentina has collected 223 billion pesos (around $2.4 billion) from its one-off pandemic wealth tax.”

Will Wall Street Eat Away at Biden Infrastructure Spending?

RICARDO VALADEZ, CARTER DOUGHERTY, carter@ourfinancialsecurity.org@RealBankReform
    Valadez is private equity campaign manager at Americans for Financial Reform and Dougherty is communications director for the organization.

    The group just put out a statement: “Wall Street private equity is sometimes called the ‘billionaire factory,’ but that doesn’t stop these already-rich folks from trying to get their hands on taxpayer money. When the COVID-19 pandemic began, private equity lined up to get money from CARES Act — and succeeded. Then, only strong public pressure kept it out of the Biden rescue legislation. More recently, only fighting by Democrats and progressives kept them out of the bipartisan infrastructure bill.

    “Now private equity is going to try to feed at the public trough again in the coming infrastructure legislation that Democrats want to pass via reconciliation. That will be yet another fight with Wall Street in the fall, even as progressive lawmakers prepare for a broad reform of private equity known as the Stop Wall Street Looting Act.

    “Private equity (they used to be called leveraged buyouts) is a nasty Wall Street invention whose influence has exploded in the last decade. They buy profitable companies, mostly with debt that the company has to pay back. They sell off valuable assets, lay off workers, create business disasters, and too often, bankruptcies. Payless Shoes and Toys ‘R’ Us both went belly up at the hands of private equity. Solarwinds, the firm behind the massive hack of U.S. government agencies, was also private equity’s work. Take a look at this two-minute video from AFR to learn more.”

Hollywood Actor Invokes Cultural Boycott of Israel, Risks Netflix Lawsuit, California Law Reprisal

In 2019, the Hollywood Reporter wrote: “David Clennon, an Emmy-winning U.S. actor with more than four decades of work across film and TV, has revealed that he turned down an audition for a new Netflix series from the makers of hit Israeli show ‘Fauda’ because of his support for Palestinian rights.”

Now, Clennon has escalated the issue, providing spoilers to undermine the Netflix series, risking lawsuits.

He is working with Jewish Voice for Peace/Los Angeles in calling on viewers to boycott “Apartheid TV,” especially in its most recent incarnation, Netflix’s “Hit and Run,” a U.S./Israeli co-production.

“Hit and Run’s” Israeli partners were behind the series “Fauda,” a Netflix commercial success, which was based on the premise that Israel’s military occupation of Palestinian land is necessary and justified. “Fauda” was, Clennon notes, “widely criticized for its racist portrayal of Palestinians, and for its message that Palestinian resistance to occupation is illegitimate.”

The call by Clennon and Jewish Voice for Peace marks the opening of a new front in the Academic and Cultural Boycott of Israel: Hollywood.

Clennon just wrote a piece revealing narrative plot points in the “Hit and Run” series, in order “to encourage viewers to focus on the racism and violence inherent in Israeli domination of Palestine.”

He hopes that the revelation of plot twists will “undermine the suspense which the creators of this U.S./Israeli series are trying to build, in order to keep viewers engaged.” Clennon’s new piece is entitled, “For Justice in Palestine, Boycott Netflix’s Apartheid TV: ‘Hit and Run.’

Clennon is aware that his revelations, also known as “spoilers,” could leave him “vulnerable to lawsuits by Netflix, as well as by the U.S. and Israeli producers of the series.”

He also states that any film or television company that might hire him in the future “could be punished under California’s anti-BDS law, AB2844.”

Working with Clennon is the Jewish Voice for Peace/LA Education and Visibility Committee which has organized online boycott-awareness programs, and, before the pandemic, multiple street demonstrations and vigils.

Available for a limited number of interviews:

DAVID CLENNON, djjc123@earthlink.net

  The actor David Clennon has also written about how various media images are manipulated. Earlier this year, he wrote the pieces “Hollywood’s New Blackface” and “How Hollywood Neuters the 60s: Sorkin’s ‘Trial of the Chicago 7’ Sentences American Radicalism to Oblivion.”

Has the Infrastructure Deal Become the #ExxonPlan?

BASAV SEN, basav@ips-dc.org@BasavIPS
Sen is director of the Climate Policy Project at the Institute for Policy Studies. He just wrote the piece “Biden should reject the infrastructure plan written by Exxon and invest in saving the climate instead” for MarketWatch, which states: “Recently, Exxon Mobil [XOM, -1.18%] lobbyists were caught on video bragging about stripping renewable energy from the infrastructure proposal and turning the package into a ‘highway bill’ — with $109 billion for the highway infrastructure that perpetuates the captive market for Exxon’s products.

    “The lobbyists revealed that they specifically targeted 11 senators for lobbying — including several Democrats who signed on to the bipartisan deal.

“They backed that lobbying with plenty of campaign cash — a total of $333,000 from Exxon and its hired guns over the last decade to just the six Democrats that Exxon targeted. So it was for a very good reason that the bipartisan deal has been ridiculed on social media as the #ExxonPlan.”

First Sign of Normalcy: Ramp up Evictions

MALIKA CONNER, malika@righttocounselnyc.org@RTCNYC
Director of organizing for Right to Counsel NYC Coalition, Conner said today: “The CDC eviction moratorium set to expire July 31 doesn’t go far enough to protect tenants: It stops landlords from evicting only some tenants and doesn’t prevent landlords from suing. It also prioritizes landlords’ profits over tenants’ needs by requiring tenants to pay what little money they have towards rent.

“The current eviction protections in New York State, enacted through the COVID-19 Emergency Eviction and Foreclosure Prevention Act (CEEFPA), protects most tenants from eviction, but only if they submit a hardship declaration form. These state protections are set to expire on August 31 and must absolutely be extended to prevent a health and homelessness crisis.

“Neither of these so-called moratoriums stop landlords from suing tenants wholesale, which is a serious cause of anxiety and stress for tenants and puts hundreds of thousands of families in immediate risk of eviction when they expire.

“Right now, despite these protections, there are more than 236,000 households across New York State with eviction cases in Housing Court. During the pandemic alone, landlords sued more than 65,000 tenants for eviction. That’s a nearly 40 percent increase in eviction cases since March 2020 and tens of thousands of families at risk of losing their homes.

“We cannot let these protections expire while New Yorkers are still reeling from the pandemic. Many tenants are without work, are struggling to pay for necessities like food and healthcare, and continue to endure poor living conditions in apartments neglected by landlords throughout, and even before, the pandemic. A recent study by UCLA also found that the number of coronavirus cases and deaths ‘increased dramatically’ in states where eviction moratoriums had been lifted.

“Governor Cuomo and the State Legislature must act now to stop mass evictions. The CEEFPA must be strengthened and extended beyond August 31st so all tenants are protected. Along with its many horrors, the COVID-19 pandemic taught us some important lessons. One of those lessons is that we can never again accept the routine inhumanity of the housing court eviction machine. Allowing the eviction protections to expire is simply not an option and will quickly reel us back to overcrowded, superspreader housing courts and families facing homelessness.”

Public Banking Gaining Traction in California

MICHAEL BRENNAN, mryanbrennan@gmail.com@mrbrnn
Brennan is a research fellow for The Democracy Collaborative and just published the report “Constructing the Democratic Public Bank: A Governance Proposal for the Los Angeles Public Bank.” They also published a Public Banks policy kit for the Democracy Policy Network. Last year, Brennan had an op-ed in the Washington Post on the need for public banks in response to the pandemic.

Brennan explains: “In 2019, California passed AB-857, allowing the state to charter ten local public banks. The grassroots group Public Bank Los Angeles has been organizing since 2017 to advance public banking, and legislation to create a business plan for the public bank in Los Angeles is currently pending before the City Council. In June, San Francisco’s Board of Supervisors passed an ordinance mandating a task force create the business and governance plans for a public bank, and the California State Assembly passed AB-1177, which would create a free retailing banking public option. Ten cities and counties in central California have recently passed resolutions to begin the process of creating a joint regional public bank.

“The emerging California public banks have the potential to address a host of economic, social, and ecological crises, and public banking efforts across the country are looking to California’s cities and regions to lead the way. State and local governments need public financial infrastructure to recapture the public’s money being extracted by private banks and bond investors. The economic recovery from COVID-19 must be equitable. The ongoing housing crisis demands better tools to keep tenants and the public in control of housing and real estate development. To address the climate crisis, the financial sector must embed social values beyond profit. Economic development needs a paradigm shift toward community wealth building, especially as part of strategies for reparations for Black and Indigenous peoples.

“But with public banks moving now to a question of ‘how,’ rather than ‘if,’ movements have to begin critically considering the governance design of these banks. Because banking, finance, and policymaking are intentionally obscure and technocratic terrains, ensuring the new public banks are designed to address these crises requires ongoing popular education and engagement.”

Is Big Pharma’s Dominance Through Bayh-Dole Act Finally Getting Scrutiny from Biden?

STAT News in “Biden’s executive order would pause a Trump rule forbidding march-in rights to lower drug costs” reports: “In a little-noticed move, the Biden administration has hit the pause button on a rule that would prevent the federal government from using a controversial legal provision for combating the high prices of products developed with taxpayer dollars.”

(Last week, STAT News reported: “Major pharmaceutical companies and trade groups helped fund the campaigns of more than 2,400 state legislators nationwide in the 2020 election.” STAT News focuses on health issues and is produced by Boston Globe Media.)

JAMES LOVE, james.love@keionline.org, @jamie_love
    Love is director Knowledge Ecology International, a not-for-profit non-governmental organization that “searches for better outcomes, including new solutions, to the management of knowledge resources.” KEI is focused on “social justice, particularly for the most vulnerable populations, including low-income persons and marginalized groups.”

    He said today: “The Bayh-Dole Act, passed in 1980, created a uniform policy for the management of patents on federally funded R&D. Among the provisions are some that can be used to increase competition and address abuses, such as excessive pricing. In the early 1990s, Congress pressed the federal government to curb high prices on federally funded drugs for HIV, cancer and rare diseases. In 1995, President Clinton announced he would no longer enforce reasonable pricing conditions in contracts. Since then, the NIH has rejected a number of petitions to use its rights to ‘march-in’ on patent rights, and grant licenses to generic manufacturers, when prices are excessive.

    “Universities and drug companies have lobbied aggressively and successfully for more than 20 years to prevent this from happening. There is a petition outstanding today by three prostate cancer patients for the government to grant a march-in request on Xtandi, a drug that costs $150k+ per year in the United States, and far less everywhere else. On Jan 5, 2021, NIST [National Institute of Standards and Technology] proposed a regulation to eliminate pricing as a grounds for a march-in request. The executive order put a hold on that provision, and now the Biden administration will have to rule on the Xtandi petition, which is before DoD. The precedent will be important for many other products.”