The Washington-based Foreign Policy magazine has published on April 5 an article titled “will the Panama Papers be a catalyst for change?”, written by Tom Cardamone. The article has propagated the leaked documents as of great significance and asked if such disclosed documents could push a change of the global economy. This question, should it be found reasonable, could open the door to answers related to the real motives behind this leaking and that if this revelation aimed at causing pre-planned changes.
The financial experts suggest that the major objective behind this leaking is to target the Swiss economy into which monetary flows keep going, and to allow some US states take its place. But, what about the Foreign Policy’s article which unveils new realities in its fresh look at the event? What are its reasons?
Foreign Policy’s Report
The American magazine has opened its discussion of Panama Papers with a question: Will the Panama Papers be a catalyst for Change in the global economy? Foreign Policy’s report maintained what the Panama Papers recently disclosed are not new when it comes to the blatant corruption in the weak countries or the countries in which the powerful tyrants are ruling.
The article continues that it does not take a long time to get back in history books to find similar activities as the billions found to be held offshore by the former Egyptian President Hosni Mubarak, former Libyan leader Muammar al-Qaddafi, and Tunisia’s former President Zine el-Abidine Ben Ali easily make the point.
But, the article puts the importance on what makes these leaked documents different, which is their large volumes. This certainly provides information about documents, shell companies, clients countries affected and countries’ leaders. All these documents have provided more data than any other similar leaking source.
This is the largest disclosure of information in the world, according to the Foreign Policy’s article. It is also larger than WikiLeaks’ diplomatic leaking since 2010, as it is also larger than the confidential intelligence documents revealed by Edward Snowden, the former CIA’s contractor, to the journalists in 2013. The volume of information makes WikiLeaks look like “amateur hour” in comparison to Panama Papers, the Foreign Policy’s article suggests.
The most important question: Will the Panama Papers be a catalysts for changes in the global economy?
The writer continues that “whereas 9/11 was the impetus for the elimination of shell banks, and the 2008 global financial crisis created the political will to initiate the Organization for Economic Cooperation and Development’s Base Erosion and Profit Shiftin (BEPS) plan , it is unclear if what has gushed out of Panama will be perceived as a crisis.” “If it is perceived as such, then real change, in the form of the elimination of anonymous shell corporations, may be achieved, however, if the illegal activities of the politically ensconced and financial elite are seen as terrible but, alas, just business as usual, little reform is likely to occur,” says the writer.
The article goes on, asking if the world is suffering from a corruption fatigue after enduring a whorl of bank scandals, corporate tax evasion and sweetheart deals. The answers to two questions perhaps answer a question of possible change these documents could stir. The first question is who are the people among the 14,000 clients who are not well-known political, business, or entertainment figures? How much money do they have, how did they make it, and why do they hide it?
The second question is about the reactions of the global public opinion as well as the international community to what Foreign Policy’s article calls the “scandal”. Could these disclosures lead to emergence of another Mohammad Bouazizi, the Tunisian street vendor who set himself on fire on 17 December 2010, in protest of the confiscation of his wares and the harassment and humiliation that he reported was inflicted on him by a municipal official and her aides and his act became a catalyst for the Tunision revolution.
Analysis and Reasoning
Without doubt, what Foreign Policy has published could be considered of importance due to its theme, but some cases must be brought in spotlight, as follows:
– There was a question about absence of names of large Western companies, banks and the important businessmen in the reports presented by the media centers which received, counted and investigated the Panama Papers. The experts doubt that the $2billion, which is considered by the Western media’s reports as the most important scandal case and which is linked to the friends of the Russian President Vladimir Putin, is the largest sum leaked by the documents of Mossack Fonseca, world’s fourth-largest center for offshore services, while the hidden money in offshore sector are estimated to be between at least $7.8 trillion and $13 trillion.
-The offshore scandal is painted by Western media as a scandal case in which the rich people are engaged for their tax evasion, or for hiding their fortunes, while it is really a case of the global economic crisis and is essentially connected to the deep wealth gaps between the rich people, which account only for 1.0 percent of the world’s population, and the ordinary people. This leads to the government’s falling short of funds and borrowing whereas large amounts of money is at the hands of the rich minority of the citizens.
– Not far away from what is happening, the German economist Ernest Wulff, in an interview with the Russian news agency Sputnik, has said that after Panama Papers scandal, Washington would make billions of dollars from its process of redirecting the money streams to some American states.
Actually, the US wants to become a new tax haven. According to Wulff, the Panama Papers scandal does not aim to remove the attractive places for off-shore accounts, rather, it tries to reroute the destination of the offshore money to other regions including some US states which adopt strict banking secrecy. Wulff continued that the scandal does not touch any American company, thus it could be part of an intended American strategy. The German economist also added that Washington has already managed to breach the secrecy principle of deposit accounts in Switzerland, where Geneva is forced to present whatever of information the American authorities ask for about the American citizens’ banking activities, as it was the case with other countries.
So, the Panama Papers is the game of the giants. Nobody in the world, especially those who are subject to domination of the great businessmen is found to care about the ordinary people. At the same time, fanning crises is not new to Washington which seeks an upper hand in the global economy. But could it succeed?