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Panama partners in crime

“We have broken no laws and cooperated with the government at all times.”


Variations of that statement seem to be the default defence of everyone from bankers to politicians when their names come up in the Panama Papers.

In the UK the latest to resort to some version of it, was first Downing Street on behalf of the Prime Minister David Cameron, and then HSBC on behalf of it’s notorious Swiss subsidiary.  The former because his father who lived in the UK, set up an off-shore company which has never paid any taxes in the UK, and the latter because it turns out HSBC has once again been handling dirty money, this time holding and moving money for off-shore companies owned by relatives of Syrian President Bashar al-Assad.

Now HSBC is a well known money laundering bank. They have been indicted and convicted of money laundering so many times in so many different countries.  The best known case was in 2012 when HSBC were found guilty of  laundering drug money out of Mexico. HSBC were tried in the US and fined $1.9 billion. They paid and said how sorry they were, and their group Chief Executive Stuart Gulliver accepted responsibility for their past mistakes, but assured everyone they had now put all that behind them and had even,

spent $290m on improving its systems to prevent money laundering,

That was 2012. In 2015 HSBC all that was found to be blather. HSBC were caught laundering  – again. This time it was HSBC’s Swiss subsidiary which had laundered

the proceeds of political corruption and accepted deposits from arms dealers while helping wealthy people evade taxes.

And so I have been thinking about this phrase we keep hearing, about not breaking laws and cooperating with governments.  Now obviously the first part is rubbish for the likes of HSBC, but perhaps not for the origin of the Panama papers themselves the Panamanian Law firm, Mossak Fonseca. I think they probably have been operating within the law. Doing so by having laws with more holes in than a sieve and governments who leave critical areas of compliance in the semi dark of self regulation or even connive with skirting round the rules.  And this connivance is why I am so interested in the second part of the phrase we keep hearing, the cooperating with governments.

You see I think when we hear the whole phrase, in one variation or another, we are meant to think the two halves of the statement are linked. The bank, law firm or individual has never, at least not ‘knowingly’, broken the law and is now cooperating with the government. The cooperating is seen as the antidote and response to the embarrassing lapse in obeying the law.

But let’s tease the two halves apart. The ‘knowingly’ is precisely how HSBC, Wachovia, Citi or Standard Chartered all admit laundering was done at the bank, but are never guilty of having laundered it…not knowingly.  It is always a huge surprise. A discovery which saddens and angers them. Which they then move on from…. with the blessing of their government.

This is how they are fined but never guilty, how dirty money can have engorged their balance sheet but they never lose their banking license.

I think we could be forgiven for getting the sneaking suspicion that governments cover for their banks.

So I look again at the phrase I started with and hear it differently now. Instead of hearing how the  bank, law firm or individual is contrite about an ‘unwitting error’ about which they are now cooperating with the government, I now hear first a lie about not breaking the law, but then a startling truth.  You see, I wonder if we shouldn’t think that the one truth being hidden in plain sight in all this is that the financial world has indeed been cooperating with governments – but doing so all along.

Does it not make more sense to think that what we are seeing is not a few rogue bank employees and lawyers breaking the law and embarrassing their employers and their pathetically useless, regulators, but rather two cooperating parts of a system of finance and government who are suddenly revealed together? It’s not dirty bankers and corrupt lawyers who are – now they have been caught – having to cooperate with government, to clean up. Not at all. I think we should at least consider that the better explanation is that the two, financial/legal world and government have been cooperating all along.

It stretches the limits of credulity to keep imagining that the bankers aren’t well aware who their clients are and how dirty the money is they are accepting. Equally it is ridiculous to think that governments aren’t aware of how oligarchs become wealthy or presidents suddenly become billionaires. And that dirty but hugely wealthy system is there just whispering to our leaders – who let’s face it are mostly drawn from the wealthiest families.

I suggest that what we are seeing with the Panama Papers is two partners in crime who have been caught together – The ‘criminal’ and the inside man/bent cop together. Normally the criminal – or at least the organisation that he works for – look to the bent cop to protect them. Someone will have to do time of course, but the arrangement remains hidden and therefore protected.

But now the arrangement itself might be uncovered. And if the bent cop, the inside man, is revealed, that threatens everything doesn’t it? That is far more serious. And so here they are, both caught in the light, both being questioned in public. The bankers and lawyers must be wondering how far they can trust the politicians.

Normally this sort of thing is covered over by finding some poor low level fall-guy. Who even if he tries to say the corruption goes higher is easy to discredit or shut up. But now big level people on all sides are blinking in the unwelcome lights.

I think we should admit that both the global financial/legal system, and our governments are both systemically corrupt and have been partners in crime – laundering money and evading taxes – as a matter of undeclared policy. It has been and remains just the way the system they profit by, works.  The only people who were not to know is us – The little people of every country, who are told they must pay their taxes, accept cuts because they aren’t paying enough taxes, and obey the laws and respect their betters.

Time to wake up surely?



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71 Responses to Panama partners in crime

  1. Mike April 6, 2016 at 12:14 am #

    Hey David,

    Good to hear from you. I hope all is well.

    Well put. Bottom line is if you haven’t broken the law, why on earth would you be cooperating with the government.. Its like driving past the cops with the speed gun well within the limit, stopping and going over to discuss it with them.

  2. Spartacus Rex April 6, 2016 at 8:26 am #

    “Time to wake up surely?”

    Kudos David!

    At long last, finally seeing the light.

    These bastards have been in bed together for eons.

    from Thomas Jefferson:

    “But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and provide new Guards for their future security.”

    The issue which has swept down the centuries…and which will have to be fought sooner or later…is the people vs. the banks. – Lord Acton, Historian…1834 – 1902

    A government that robs Peter to pay Paul can always depend on the support of Paul.
    George Bernard Shaw

    “You have a choice between the natural stability of gold and the honesty and intelligence of the members of government. And with all due respect for those gentlemen, I advise you, as long as the capitalist system lasts, vote for gold.” George Bernard Shaw

    History records that the money changers have used every form of abuse, intrigue,
    deceit, and violent means possible to maintain their control over governments by
    controlling money and its issuance. -James Madison

    It is the common fate of the indolent to see their rights become a prey to the active. The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt. John Philpot Curran (1750-1817)

    S. Rex

  3. Syzygysue April 6, 2016 at 11:04 am #

    Wonderful juxtaposition of ad about investing in Panama, right next to your excellent post… made me laugh. I made sure to click on it to get you your penny’s worth.


  4. Amanda Susan Adlem April 6, 2016 at 12:15 pm #

    Good to see you posting again….hope things ease up for you on other fronts…

  5. steviefinn April 6, 2016 at 1:39 pm #

    It adds insult to injury that many ( or all, for all I know ) decide that the taxes they don’t pay should be used to spend a 100 billion or whatever for Trident so they can ponce about the world stage with the equivalent of a nuclear strap-on, while telling those who do actually pay tax, that there is no money for hospitals etc. Sanders apparently warned about Panama in 2011 & I read an article earlier on ‘ Naked Capitalism ‘ which included this paragraph :

    James Henry: ” The big thing we should be concerned about is, there is onshore haven behavior in the United States, and it is undermining our own tax compliance and tax citizenship. I mean, if ordinary people are the only ones paying taxes, then you’ll have a tax revolt on your hands…We depend for our tax system and for our democracy on ordinary people paying their taxes. If they go on strike, it’s going to be a serious problem. It’s nothing less than our democratic process at stake ”


    Also included is this list of some of the funders of the Consortium of Investigative Journalists. who were handed the red hot potato, for those who havn’t already seen it :

    Ford Foundation

    Carnegie Endowment

    Rockefeller Family Fund

    W K Kellogg Foundation

    Open Society Foundation (Soros)

    All this seems to have buried the under reported Unaoil story, but I suppose it could be the same usual suspects who will hopefully end up twisting in the wind.

    • Shaun S April 7, 2016 at 6:24 pm #

      Hi steviefinn, you missed one, USAID, Killary Klintons old outfit.

      What is clear is that the “search” methods used, did not cover anyone else BUT the enemies of the US/Soros. They evidently did a search for “sanction busters” and also used a list of names that were considered not exactly subservient to US dictats (ie. Putin etc.) All others have been ignored (98-9%), specifically the US or Israeli big-fry.

      I reckon the leak itself could only have come from an off-official US spy department. (The FBI/CIA had three departments that recorded ALL monetary movements across the world, even before 9/11, Swift or newer data collection scandals)

  6. PaulC April 6, 2016 at 3:41 pm #

    ZeroHedge is quite good on this one, and it seems more and more obvious that the Panama dat release was engineered by elements in the US Deep State for very specific purposes.

    It enabled them to demonise folk they don’t like. This includes Putin, as ever; Sigmundur Davíð Gunnlaugsson, president of a country that actually kicked back at the global banks; and a handful of expendables such as Cameron).

    And, it scared large amounts of grey (and black) money back to the USA, which enforces money laundering laws the world over while making it ever easier to conceal illegal money storage and movement internally. This seems to be one of the main reasons why they set fire to The Ukraine, which had a similar effect on encouraging hot money flows from Russia and the EU back to the USA.

  7. Joe Taylor April 6, 2016 at 4:00 pm #

    Here’s a snip from a post soon after the news broke:

    I think we should now be focussing on George Osborne and Treasury who set financial policy, and not David Cameron who is just the PR guy fronting the cameras for these goons.

    Osborne’s company – Osborne and Little pays zero UK tax, and it is the Treasury which cooked up the Private Finance Initiative PFI schemes, which have seen ownership of HMRC & HM Treasury UK Offices shifted offshore to avoid UK taxes.

    Then there is also the small matter of George Osborne and David Gauke signing a Swiss tax evasion non-prosecution agreement in 2011 – which is the reason why there have been no prosecutions over 2015’s HSBC “Swiss Leaks” scandal.

    Osborne also controls funding to the UK’s Serious Fraud Office – and there are suggestions it was Osborne who called off the SFO investigation into the UK’s role in foreign exchange rigging by abusing his personal veto.

    Forget Cameron. Its time to land a few body blows on Osborne and Treasury/HMRC





    Time to get going with our social media?

    • Golem XIV April 6, 2016 at 4:34 pm #

      These are great links, Joe. Thank you. Agree that Osborne is a villain.

      • Joe Taylor April 7, 2016 at 3:14 pm #

        Dave, is it okay to re-publish this blog on the 38 Degrees Manchester website?
        I’ve put a snip and a link to it on NatCAN.

        Cheers, Joe

        • Golem XIV April 7, 2016 at 4:58 pm #

          Of course it is Joe. You do what you think best and I’m fine with it.

    • Shaun S April 7, 2016 at 6:13 pm #

      Excellent links. Thanks

      One other facet of the Panama imbroglio is the emergence of the US as a (the major?) tax haven. (also due to ZH articles). Add another item – that the Rothschild banking system has set up an office in Reno to “welcome” accounts fleeing Switzerland etc. for Nevada, Wyoming and South Dakota. The US is one of the four tax havens that have NOT signed up for financial transparency, Panama is another.

      The trouble is that corruption is now an integral part of all levels of control/finance in all countries.

      • Ken Lorp April 8, 2016 at 7:29 pm #


        Initially, I was upset that the US was setting itself up as a tax haven. After all, they spent years bullying the other tax havens and dismembering them and are now the biggest haven on the planet (incidentally, the UK is number 2).

        However, the US banking system is also insolvent. So, those wishing to stash their ill-gotten gains away are taking a huge risk – as non-US citizens, they don’t vote and don’t have political influence.

        Wouldn’t it be so sweet if, come the next crisis, most of that money vanishes in insolvent banks?


  8. Gemma April 6, 2016 at 4:51 pm #

    The saddest part of all this is that the papers have been used to depose the only govenment to stand up to the banker cartel.


    Everything else pales in comparison to this; the US and UK are so lawless that the banks can do whatever they choose, whenever they choose. Mainly because the ‘democratic’ representatives are so easily bribed.

  9. Elspeth Crawford April 6, 2016 at 9:04 pm #

    the Panama Papers media reporting has moved frighteningly quickly to focus on people – rather than on the system wherein there will always be people, some abusing, some misusing and many missing the spirit of ethical behavior. What do you think will make a difference and push focus back onto – change this system somehow?

  10. Judith April 6, 2016 at 10:16 pm #

    Laws are made by the happy few with premeditated innocence in mind.
    Ethics and morality don’t stand a chance against the written law. If needed they can always say: “look here, it is legal”.
    The Panamanian law firm will not be the only one that shields the 1% either.

  11. Steve Beer April 7, 2016 at 12:25 am #

    Sounds like we need a 1381 peasants’ revolt….

  12. Spartacus Rex April 7, 2016 at 10:30 am #

    How Mossack Fonseca helped hide millions from Britain’s biggest gold bullion robbery

  13. Timothy Price April 7, 2016 at 4:12 pm #

    Directly related to this, “The only people who were not to know is us – The little people of every country, who are told they must pay their taxes, accept cuts because they aren’t paying enough taxes, and obey the laws and respect their betters.”

    Time to wake up!!!!!!!!!!

    As a strategy, pick just one issue and pursue it to a conclusion.

Fort Knox Paradox – Gary Christenson
or here:

    Have the Federal Reserve Fort Knox gold audited. Pick a date for the conclusion, and ram it up their butts.

    Push for the audit. Create a public outcry. This must be done ASAP.
    The only responsible course for the public is to learn the accurate count of the gold reserve.

    It is our right to know, it is our need to know. We demand to know NOW.

    Help us get to the bottom of the fraud… or reassure us that the gold is there. Either way… audit the Fort Knox gold.



  14. Shaun S April 7, 2016 at 6:35 pm #

    Here is another link to “george washingtons blog” via ZH, which gives a good overall summary of what is going on . Both in the US and London.

    It doesn’t mention Osbourne though, which is a pity He deserves more exposure to the light of day..

  15. ACA made it worse April 8, 2016 at 6:41 pm #

    Slightly off topic, but not by much. Healthcare. You said, “I think we should admit that both the global financial/legal system, and our governments are both systemically corrupt and have been partners in crime – laundering money and evading taxes – as a matter of undeclared policy.”

    Healthcare in the US is utterly corrupt with government as a co-conspirator. Obama took some x hundreds of millions of dollars from Medicare to fund ACA, and the vultures moved in to hoover up those dollars. They have zero interest in health care or protecting the welfare of the citizens who provide the funds.

    Case in point: generics. Akorn. Run by an Indian billionaire (Isn’t it wonderful how someone can come here with nothing and become a billionaire? Not.) Health Net plays a shell game with their formulary so that poor people wind up paying hundreds of dollars for generic prescriptions provided by this company. Not satisfied with that racket, Akorn offshores the manufacturing to India, where the FDA increases inspections and files Form 483s for safety violations but does nothing to shut it down. Not satisfied with that, the billionaire sets up a Nevada corporation and numerous shells.

    This is one of the reasons there is no real recovery here, because the little people are expiring under the criminal assaults enabled and protected by government.

    Cheers. Seriously.

  16. Ken Lorp April 8, 2016 at 7:19 pm #


    It’s been quite a while since I was last here, but I have found a bunch of wonderfully written pieces. I’ve spent the last few days thinking about the Panama papers and speaking to some people who have looked at the detail and have a few thoughts…

    For a great many people and corporations, there is nothing illegal or immoral about placing assets offshore, for whatever reason. There are, in fact, many legitimate reasons for doing so. The illegality or immorality comes from whether they declare to their local tax authorities any gains made. Looking at Cameron’s position, it would appear that he did declare it to HMRC and he paid all taxes required. To suggest that the vehicle should have paid UK tax is a red herring – the participants in the vehicle did pay tax in the UK, so on a net-net basis, the UK is no worse off. In fact, it’s much better off as the individuals paid income tax rather than the vehicle paying corporation tax.

    However, the real issue is not being reported. There are a bunch of very unpleasant people on the list with large fortunes hidden away. The upset seems to be that they have money in a Panamanian vehicle – not how they arrived at that fortune in the first place. A great many of them stole it from their people.

    Why are we upset that they placed it in Panama, but not upset that they originally stole it from their citizens? Why do we want to prevent them putting money in Panama, but we don’t want to stop them stealing it from their citizens?


    • guidoamm June 4, 2016 at 5:52 am #

      @Ken Lorp…. for the very same reason that everyone is a humanitarian after the fact but nobody is interested in doing something about the causes that precipitate the humanitarian crisis in the first place.

  17. Wesley - and Dirty Secrets April 8, 2016 at 8:51 pm #

    Wonderful! I hope the full details become public!

    The dirty-not-so-little-secret of the banking cartel duopoly: Thin-air “ex-nihilo” State fiat money creation, enabling private-banking ex-nihilo “money” creation. The laws enabling the outright monetization of government debt, are the evil twins of the same laws (or more specifically, the absence of laws) that permit the counterfeit credit creation at the root of inflation-theft of the common-man’s savings, together with the fraudulent accounting for same. I’ll buy your government bonds (and charge a fee), sell them back to you (and charge a fee), if you look the other way to my depradations of money.

    Sunshine is the best disinfectant!

  18. gordon ker April 9, 2016 at 9:09 am #

    It surprises and frustrates me to see how gullible the majority of people are. There are four facts of life in our present existence and all are interlinked. Narcotics, oil, money and war. These are all businesses which governments and the elite deal in through the banking system. This information was leaked for a reason and not freedom of information. Our failed neoliberal system is crumbling and with it’s policy of unemployment, governments are struggling to raise taxes therefore these institutions are being exposed to the mainstream. Democracy and lack of real education keep most people in ignorance and when the truth is revealed shock and indignation are the childish responses. Most people obviously would not wish to face the truth so struggle to live, and die in blissful ignorance. Hot Money and the Politics of Debt a book which may help.

  19. BobRocket April 10, 2016 at 6:43 pm #

    Good to see you back David, genuinely hope things are going well for you personally.

    ‘The only people who were not to know is us – The little people of every country, who are told they must pay their taxes, accept cuts because they aren’t paying enough taxes, and obey the laws and respect their betters.

    Time to wake up surely?’

    There are four classes of people.

    Top People
    Big People
    Middle People
    Little People

    Top People are ceremonial

    Big and Middle fight for control

    Little People doff their caps then spit in the tea and piss in the soup of everybody above them, we never sleep.

    Re-read your 1984.

  20. JohnG April 11, 2016 at 9:24 am #

    Tax laws are complex for a reason. And it isn’t to collect more taxes from the wealthy.

    But what’s more interesting about this story is who is behind it and the selection of the targets.

    The ICIJ is a front for the US deep state. Funded by the usual suspects, Soros, Ford Foundation, Kellog etc and linked to the NED.

    And I’d bet good money that it was an NSA hack.

  21. steviefinn April 12, 2016 at 1:22 pm #


    I hope this works as above should show a brilliant infograph of the methods of rent extaction since the English enclosure movement, from this article that outlines the history & makes this startling assertion :

    ” If we were to tax a mere 10% of the money hoarded away in tax havens, we would have at least $2,000,000,000,000 that could be used to fund (1) universal basic income; (2) universal healthcare for more than 7 billion people; (3) free public and university education for everyone on Earth; (4) fund basic scientific research for all major problems humanity must confront; and (5) make the transition to ecologically-based energy systems and urban design that staves off the potential for collapse of our highly unsustainable civilization.
    Think about that for a moment. Let it sink in “.


    No pic but worth a click.

  22. guidoamm April 13, 2016 at 7:04 pm #

    Hi David,
    government must arithmetically and necessarily be involved.

    The UN is my favourite piñata. It is a piñata that lands itself to be struck over and over again simply because they put out such an enormous amount of research that they unwittingly poke themselves in the eye every single time.

    Drugs is a glaring case in point.

    In the laundry list of reasons offered as excuses to invade Afghanistan, one was to tamp down on the production of drugs. Since the West has invaded Afghanistan however, poppy production has increased geometrically (UN reports).

    Now, think about it.

    The sheer amount of product produced by the thousands of hectars under cultivation cannot reasonably be moved by individuals. This amount of product requires some equipment. Preferably some flying equipment. Better still if said flying equipment can get in and out of countries without undue scrutiny but legally.

    Similarly, the sums generated by the drug trade are far too large to be moved by individuals or small financial institutions. The sheer sums in question can only be transferred through official channels that can shift these amounts without raising too many flags.

    As a by the by, some years ago, you may have come across an interesting expose by the Washington Post titles: “Top Secret America”


    With the several Trillion Dollars that the Pentagon had already misplaced since 2000 and with the lack of a central supervisory authority, how do you think an apparatus of so many secret agencies can be financed through official and overt channels?

    But, more importantly.

    Since this monetary system was imposed and the management thereof occurs behind closed doors by unelected officials, the arithmetic underpinning the system tells you that the diminishing marginal utility of debt guarantees that, as the enabler, government must necessarily go from tolerating malfeasance, to abetting it till, eventually they must collude in it.

    Remember the notorious list of Systemically Important Financial Institutions?

    Remember what Eric Holder had to say at the time?


    Of course government is in on the gig. It cannot be otherwise. Government is the enabler and the arithmetic of the system says that this is the end of the road. Desperate times call for desperate measures and so, malfeasance and criminality become gradually more evident and overt

  23. Jon Stevenson April 14, 2016 at 8:45 pm #

    Why do you think Sajid Javid now works for the Government. Exactly the above.

  24. steviefinn April 15, 2016 at 1:06 pm #

    Good video from Michael Hudson on how the whole dirty money laundry business was set up, who it benefits most & the massive problem due to big muscle vested interest, of closing it down :


    • Wesley wearing a flag of convenience April 17, 2016 at 7:31 pm #

      Good catch Stevie! Unmentioned (in the transcript) is the Marshall Islands. Most of the energy product coming into the US’ major ports now is on shipping “flagged” (domiciled?) in the Marshall Islands… Guess what the currency of that lovely tropical isle is? Of course: as with Liberia, and Panamá – it’s the US Dollar. Why do you think that a huge percentage of world’s megayachts are also flagged in the Marshall Islands? Panamá, Liberia, and the Caymans – so 1980s, 1990s, and 00s, respectively…

      • steviefinn April 18, 2016 at 1:54 pm #

        Kinda tied up some loose ends for me, mainly in the sense of criminal money, which is obviously going to be very liquid. Fortunately it seem that the so called ” War on drugs ” failed miserably ( surprise surprise ), else they wouldn’t be able to fund all the other failed wars.
        I suppose that I also shouldn’t really be surprised as the East India company started the ball rolling with opium revenue funding the empires expansion, plus the fact that the same sort money is now being used to shore up the undead banks & that like those megayachts you mention – breaking the law is the divine right of the very few & definitely not for us little people.
        Not that I want a megayacht, a weeks holiday would be nice though 🙂

        • steviefinn April 19, 2016 at 4:59 pm #

          ” Once the genuine public anger over the Panama Papers revelations subsides, what will actually change? Can tax havens really be eradicated – and what would it mean if they were? To discuss these questions Steve Bloomfield is joined by Nicholas Shaxson, the author of ‘Treasure Islands’; Francesco Guerrera, chief financial correspondent for Politico; and John Christensen, executive director of the Tax Justice Network “.


  25. Kreditanstalt April 24, 2016 at 8:41 pm #

    I find it extremely difficult to castigate ANY tax minimizers, avoiders or evaders – rich or poor – given the imperative of shrinking the size of governments, cutting their funding and, most importantly, reducing their power.

    Good grief. Isn’t it about time to return some of that money to its private sector owners, where it just might do some good?

    • steviefinn April 29, 2016 at 4:10 pm #

      1.2 billion ECB stealth bailout – Deutsche, Unicredit ?……interesting comments on the state of DB’s computerised systems :


    • Wesley May 8, 2016 at 12:30 am #

      Completely agree! (Though JohnG will likely again accuse me of not wanting to pay ANY tax…) The problem is though, that the rich and poor are provided different mechanisms for tax minimization practices. The rich pay different tax rates on capital gains (less than half in most cases) – which the poor do not have access to. The rich deduct interest payments on property mortgages – the poor don’t own property. The next attack is targeting the ability of the poor to transact in “cash” for tax avoidance and minimisation. (This attempt to eliminate cash is also a stealth additional attack on the evil “saver”.) Suffice to say, the asymmetries run the entire gamut – as the rich write the laws! If the tax code were one page long, comprised of a single sentence for a unified tariff on imports, and a single sentence specifying the one tax rate for all forms of income, your specified goals would be reached with simplicity. As to your last sentence, there is quite a large difference between the “return” of tax “money”, and not seizing it in the first place… What very few seem to take into account when discussing taxes, is the unacknowledged tax imposed on EVERY SAVER and Fixed Income recipient by the theft of institutionalized inflation (debasement of the monetary unit). The rich are the first receivers of “new money” creation by the commercial banking sector. This is the taxation without representation bit… Do you remember voting for a 2% inflation “target”?? And do you agree with how “inflation” is measured or even defined??

    • JohnG May 10, 2016 at 6:53 am #

      Government spending creates the money that pays the taxes.

      But you’re probably never going to get that. The libertoonian mind is impenetrable.

      • Alastair May 12, 2016 at 5:28 pm #

        John moving on from that what I find interesting is the growing groundswell around citizen/basic income concepts. I’ll say upfront this is an idea that I’ve been supportive of for many years. I’m actually at the more extreme end of the spectrum in that I believe in a full liveable BI/CI paid universally.

        Set at a level, cradle to grave, to replace every other form of welfare barring instances where disability requires more support. Spent directly into the economy by the central bank no borrowing required. Regulated that it cannot be counted towards individual credit worthiness, nor sequestered for debt repayment. Removal of tax allowances, any and all income is taxable.

        Would be interested in your thoughts

        • JohnG May 15, 2016 at 12:54 am #

          Totally against UBI because it solves nothing in the longer term in either economic or social terms.

          Much better to have a Jobs Guarantee AND higher levels of income paid to those unable to work or are retired.

          People want to work, not just for financial reasons. Contribution and inclusion are basic tenets of society.

          • Alastair May 16, 2016 at 3:19 am #

            Do you think a job guarantee is a feasible target in modern times? Also why do you assume that a UBI would take people out of work? I support a liveable UBI but not a live in luxury UBI.

          • JohnG May 31, 2016 at 4:51 am #

            Why would it be not feasible? I’m not assuming that a UBI would reduce employment but it would not necessarily increase it and thus productive capacity.
            So you’d have a long term inflation bias and you’d have to tax the middle and upper income earners at much higher rates to pull aggregate demand down.
            A jobs guarantee would increase production, capacity (especially future capacity) and be socially more acceptable.

      • Wesley - what's a libertoonian? June 19, 2016 at 5:03 pm #


        JohnG: your irrelevant comment, in addition to hurling impolite ad hominem, sails so wide of the topic in discussion that I am forced to wonder about when you last had your prescriptions adjusted…

        To be clear, after attempting to re-read and process the thread, can you honestly claim that anyone is inquiring here about whence “money” comes from?

        Ditto @Alastair… why don’t you and JohnG get together privately to discuss your misguided notions of forced redistribution? Or ask the host to open a thread (guest submission of an MMTer?) on this complete non-sequitur?

        Thanks in advance for not wasting any more of our time.

  26. Spartacus Rex May 5, 2016 at 7:46 am #

    Wake up.
    Time to Vote!

  27. Patrica May 24, 2016 at 11:46 am #

    I have been thinking a lot about the taxation system lately and the following is what I propose. I would love some of you clever people to comment on it and tell me where the loop holes are so I can think further about it.
    Let’s just abolish the existing tax structure and start again. No income tax, no corporate tax, no fringe benefit tax, no exemptions of any sort, no stamp duty, no payroll tax, no GST. Nothing. Then put a financial transaction tax on all deposits, double the rate if the money is sent overseas – the rebuttable presumption being that it is done to avoid taxation. Then everybody, individual and company, would be contributing to the running of the country they either live in or in which a business is active. The FTT would be so easily administered because it would be collected by the Banks on behalf of the Government. If there was too much money in the system then then that FTT could be increased and vice versa.
    If a country elected a Government that put its people first then it could also have a progressive inequality tax on incomes over X times the average wage with an inflation adjustment for tax bracket creep. The government could then work out a policy how to better the country as a whole with all that tax money and it would be a lot. Even a UBI!
    But if the elected Government wasn’t interested in the welfare of its people then the Country would not have an inequality tax. Everything would be so very transparent.
    Surely anything is better than the nonsense we have now

    • Roger Lewis June 19, 2016 at 10:24 am #

      Hi Patricia,

      Have you read any Henry George in your deliberations?https://en.wikipedia.org/wiki/Georgism

      • Patrica June 21, 2016 at 10:33 am #

        I have read a little Roger – not a lot I must admit but my gut feeling is that it would become merely an additional tax and I think we have enough taxes and exemptions as it is. My initial worry with my idea is that in reality there should be a complete overhaul of the existing system – I have followed positive money a bit. But you have to start somewhere. Even with a FTT would it cause inflation if all taxes and exemptions were abolished?

        • Roger Lewis June 22, 2016 at 4:14 pm #

          Hi Patricia, I think Georgists believe that a single land tax is all that is required no other taxes would be necessary or desirable. I think its a big question to get our heads round given the complexity of taxation in modern states. Looking at a FFT makes a lot of sense of course and Positive-money have published some very interesting figures on seniorage missed out on by the British State allowing so much of its money to be created by private banks. ( ignoring the arguments about what banks create being actual money? ducks and runs for cover!)
          I no longer consider myself to be a Capitalist and my own reading on these matters lead me to the smoking gun of Usury. Interest on money lending is I think a big part of the problem even where money is made sovereign or where the usury is properly (in quotes) taxed.

          I watched two videos earlier which are interesting the first is 3 questions posed by Peter Joseph of the zeitgeist movement looking at
          1) Given the market economy requires consumption in order to maintain demand for human employment and further economic growth as needed, is there a structural incentive to reduce resource use, biodiversity loss, the global pollution footprint and hence assist the ever-increasing need for improved ecological sustainability in the world today?

          2) In an economic system where companies seek to limit their production costs (“cost efficiency”) in order to maximize profits and remain competitive against other producers, what structural incentive exists to keep human beings employed, in the wake of an emerging technological condition where the majority of jobs can now be done more cheaply and effectively by machine automation?

          3) In an economic system which inherently generates class stratification and overall inequity, how can the effects of “Structural Violence” – a phenomenon noted by public health researchers to kill well over 18 million a year, generating a vast range of systemic detriments such as behavioral, emotional and physical disorders – be minimized or even removed as an effect?

          What Peter and those of his ilk are saying is money is a tool of Markets and modern technology and requirements of society are such that Money and Markets are obsolete and based on notions of scarcity which are no longer factually required.

          The other talk was this one from Ben Dyson of Positive Money at zeitgeist 2015.https://www.youtube.com/watch?v=6Efeeth5rSg in this talk the explosion of Debt and by consequence money supply since 2000 in particular but since 1970 is a staggering fact.

          Finally I have come across the work of Helmuth Creutz which shows how erosive interest payments are to the wealth of the 90% of the population who are net payers of Interest. I guess what I am saying is that a single tax or effective fair tax structures are just sticking plasters the problem we face is more fundamental, in that I think Peter Joseph is correct although I have studied and do worry very much about the parallels to Technocracy .

          Economists generally obviscate on the question of and importance of money, almost to a man they can not get their head around the damage that usury does. A suggestion to do away with Markets, Money, usury and all the other trimmings of Capitalism is a tough argument to float, I do think though that that is where we will inevitably end up if what Bilderberg are now calling the Precariat is to avoid extinction ( through the dead hand of structural violence.)

          • Patrica June 24, 2016 at 4:49 am #

            Thank you for those links Roger. Both very interesting. I tend to agree with you about capitalism but I don’t think anything can be done about it. The “joys’ of consumption are too entrenched. BUT what will happen when mechanisation takes away most jobs? Something else, something more cooperative, may emerge. Something that might acknowledge that we are only a part of life on this planet and we must look after our planet for us as a specie to survive. Dream on Patricia, dream on.
            Your comments about ursury are interesting. I have a young Saudi man living with me and I asked him how the Muslim religion, which forbids the charging of interest, allows the Banks to operate. He said that the Banks buy the house you want and then sells it back to you at an inflated price. I can see an advantage in that in that the individual then knows exactly what they have to pay each week. Here in New Zealand the banks can alter the interest rate they charge through out the life of the loan.
            While I agree that my FTT tax could be regarded as a band aid, surely we have to start somewhere otherwise we are just accepting that nothing can be done. While I am 77 and at the end of my life I do have grandchildren. I do think each and every generation has an obligation to leave a world better than they inherited.

  28. kimo June 15, 2016 at 8:41 am #

    As the eve of BrExit approaches, can you remain quiet?

  29. backwardsevolution June 17, 2016 at 6:04 am #

    Paul Craig Roberts spells out how Ambrose Evans-Pritchard (who used to be stationed in Washington, D.C.) found out around 2000 (from old documents) that the CIA were instrumental in getting the EU started. They wanted to be able to deal with one entity, not a bunch of sovereign countries.

    He goes on to talk about the TTIP (TransAtlantic Trade and Investment Partnership, the secretive trade treaty) and how the U.S. is negotiating again with the unelected officials, the EU, and not each sovereign nation.

    He portends that every single country in the EU will lose their sovereignty, that eventually there will be no nations, just the EU. You will lose your country.

    Good listen.


    • Salford Lad June 17, 2016 at 10:19 am #

      A transcript of the PCR interview,regarding Brexit.
      Ambrose Evans -Pritchard receives an honorable mention
      AEP came out strongly for Brexit in the Daily Telegraph, likely from his insider information on the Geo Political dirty trick plan regarding the Eu.
      He usually toes the Neo-liberal line,likely from ‘pressure on his paycheck.

      • backwardsevolution June 18, 2016 at 10:33 am #

        Salford Lad – thanks for that link. It’s nice having a hard copy. Yes, big surprise re AEP. Maybe he sees the writing on the wall and realizes the criminals are losing control – finally – and that the UK needs to be in control of their country again. Paul Craig Roberts makes a lot of good sense here.

        UK started it all – Magna Carta, etc. Hard fought. Take your country back. Good luck with your vote.

  30. backwardsevolution June 22, 2016 at 8:52 pm #

    Jean Monnet, the founding father of the European Union, thought that “the people” were too stupid to make informed decisions, therefore democracy must go.

    “How could the various peoples ever be persuaded to hand over their countries from democracy to oligarchy, the government of the elite? Let me quote from what he wrote:

    ‘Europe’s nations should be guided towards the Super-state without their people understanding what is happening. This can be accomplished by successive steps, each disguised as having an economic purpose, but which will eventually and irreversibly lead to federation.’

    In other words he could not force them (he had no tanks). He could not bribe them (he had no money). He could not persuade them (his arguments were offensive). Hence the deliberate recourse to government by deception. Both nostrums continue to this day. Study the Remain campaign and the people behind it.

    Almost without exception they are pillars of the establishment, London-based, accustomed to lavish salaries, administrative power and enormous privilege. None of this applies to 95% of the population. Hence the need for deception. […]

    [..] You have repeatedly been told this issue is all about economics. That is the conman’s traditional distraction. This issue is about our governmental system, parliamentary. Democracy versus non-elective bureaucracy utterly dedicated to the eventual Superstate.

    Our democracy was not presented last week on a plate. It took centuries of struggle to create and from 1940 to 1945 terrible sacrifices to defend and preserve.

    It was bequeathed to us by giants, it has been signed away by midgets.

    Now we have a chance, one last, foolishly offered chance to tell those fat cats who so look down upon the rest of us: yes, there will be some costs – but we want it back.”


  31. Arthur Cutten June 23, 2016 at 2:21 pm #

    Not even Brexit can bring you back to the blog? lol

    You are missed. I hope all is well with you.


    • Salford Lad June 24, 2016 at 4:09 pm #

      Hat tip to Bill Mitchell-Economist for the following;

      The Brexit result restores the potential of the British people to resist the corporate elites and their servants in Brussels who have imposed the most brutal neo-liberal austerity – the most horrific treatment of European people for decades as can be seen by the approx 50% youth unemployment in the PIIGS economies.

      The people have rejected the corporate elites, who have wined, dined and corrupted the political elites of Europe to ensure the distribution of income is pushed further to the 1%.

      The EU have destroyed a nation (Greece) and left it as a beggar State in the EU..

      All the talk in the late 1940s about creating political structures to ensure Germany never went to war again are now irrelevant. NATO has contributed to the dangers of a WW111, by the provocation of Military execises with 30k troops on the Russian border in the Baltics and the recent positioning of Nuclear weapons in Romania and soon Poland.

      The European Union – the ‘European Project’ – is a decaying, schlerotic, necrotic bureaucratic entity, that is incapable of dealing with the challenges of the present, much less the future.

      Its economic design has failed miserably, It is incapable of dealing with the migration issue. It has long gone past its use by date.Good riddance.

      • Goalscoringsuperstarhero June 24, 2016 at 7:30 pm #

        Salford Lad, since you’re quoting Bill Mitchell’s paragraph without further comment, may I ask you to exemplify how exactly this vote is a victory for the people against corporate elites? I fail to make that connection.
        Are there no corporate elites / multinationals originating from the UK?

        Just to be clear I share the opinion that corporate elites have corrupted policy making and politics, I just don’t see how this vote changes anything about that.

        • Salford Lad June 24, 2016 at 7:55 pm #

          By exiting Europe , we have some hope against the corporate takeover by TTIP.
          i am all to aware how privatisation by our own corporations of State assets has looted the UK and turned its citizens into toll paying serfs.
          We have an opportunity to reverse this with a Labour Govt but none under the EU.

          • Goalscoringsuperstarhero June 24, 2016 at 9:06 pm #

            Thanks for clarification.
            As far as I know, TTIP is still being negotiated by the European Parliament.
            I don’t know at what state the negotiations are over the contested issues – I didn’t check but will follow up doing so.
            The very nature of ongoing negotiations would suggest that there is opportunity to influence decision making by elected MEPs.

            While I share concern over particular points in TTIP, I don’t believe a trade agreement is bad in itself. It depends on the content.

            The UK will have to negotiate many trade agreements now, and TTIP may well be amongst them.

          • Salford Lad June 25, 2016 at 12:00 am #


            The EU Parliament has no power to effect change in legislation,it is a rubber stamp collection of troughers.
            Legislation is compiled by unelected bureaucrats, who are corrupted by powerful lobbying bodies.
            The 20 man Commission does no great scrutiny, but also rubber stamps.
            The EU is not a working democratic institution, but has evolved into a corrupt bureaucratic dictatorship.

  32. steviefinn June 27, 2016 at 10:57 am #

    It’s hard to know how this will pan out, although you wouldn’t think that judging by the ” We are all doomed ” crowd. I didn’t vote as I was incapable of calculating which would be the best option, but now I wish I had voted to leave. Not because I was given access to the crystal ball or the octopus that many seem to have access to, but because as someone from a working class background, I wish I had been able to show some unity with all those decent ordinary & when allowed – hard working people who have suffered most from globalisation, Neoliberalism & the rest of it.
    Now they have finally being noticed they are for the most part being derided as idiots, by those who have no real concept of what they have suffered through the gradual turning of the screw form successive governments since Thatcher. Maybe very many are ill informed on the EU, but whose fault is that & where are they supposed to go to become well informed – to the MSM, onto the internet where there are hundreds of conflicting views ? Personally I am well aware of a few Remain voters who are also ill informed on the subject, some of whom ” La la la, I’m not listening ” when it comes to inconvenient truths in regard to the EU. Some are shrieking that we have now got ourselves a divided country, which to me points to the fact that they were just not interested in looking in the direction that would have shown that it already was,
    Anyway it looks as though Herr Schauble & Co already had plans in place, of which the main one was to tighten the net to stop any other potential escapees with full federalisation, which in the light of reports that in five more states the peasants are now revolting, they had better get a move on, else by the time the Scots give themselves over to the EU’s less than tender mercies ( which could include RBS being in the same room as the euro ) this apparently to some, great gift of a club, might have become strangely empty.
    I have no idea how this will end, not least because as with Corbyn’s election & the very fact that there was a No vote, has me thinking that there are no real certainties & that those who still think that there is are fools. My mother voted to leave & I will admit that she doesn’t know a great deal about what is really going on, but she is fully cognisant of the decline in her own community & the fact that her votes in GE’s have only resulted in things becoming ever worse. Her words to me were that she doesn’t care if doing it makes her already hard life harder, but she is voting NO, in what she realises is a desperate attempt to make the future a little brighter for her Great grandchildren – i personally see nothing wrong with that.

    Anyway – here’s a very good analysis in my opinion, that is a very good rundown of what many of those who consider themselves as the well informed are missing or ignoring in terms of the EU – coupled with an analysis which hopefully rightly debunks the sky is falling hysteria, recommended by Steve Keen which was written before the vote.. At least for the moment we still have the keys to our own house, but no prizes for guessing who wants to take them away in what would be battle I think for something more important – our Democracy, or at least what is now left of it.


    • Roger Lewis July 2, 2016 at 2:52 pm #

      Werner really nails it with that Steve. I am completely at one with your views both in my own actions and post vote sentiments.

      • steviefinn July 4, 2016 at 3:53 pm #

        Thanks mate – perhaps much will change in the EU before Brexit is finalised ( If it ever is ). German & French elections next year, can’t see Merkel & Schauble taking kindly to losing their throttle hold which it seems they are keen on rapidly tightening due to other signs of mutiny with more fedalisation. Italy is in a mess with Renzi stuck between a rock & a hard place & Junker wants to by-pass the European parliament to install CETA. Having said that though, they might well keep all those plates spinning on those flimsy sticks & unlike some i don’t see myself as a fortune teller.
        Rocks or hard places for us all ?


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