- Wall Street is full of “crooks,” and it never properly cleaned up its act after the financial crisis of 2007 and 2008, Columbia University professor Jeffrey Sachs told a distinguished gathering of bankers and professionals in bombshell remarks at the Philadelphia Federal Reserve building earlier this month. What’s behind this, says the high-profile academic twice named one of Time magazine’s 100 Most Influential People in the World, is “a docile president, a docile White House and a docile regulatory system that absolutely can’t find its voice.”View Original
Top economist Jeffrey Sachs says Wall Street is full of 'crooks' and hasn't changed since the financial crash The IMF adviser also blamed 'a docile president, a docile White House and a docile regulatory system'
http://www.independent.co.uk/news/world/americas/top-economist-jeffrey-sachs-says-wall-street-is-full-of-crooks-and-hasnt-changed-since-the-financial-crash-8594779.html
“If you look at the campaign contributions, which I happened to do yesterday for another purpose, the financial markets are the number one campaign contributors in the US system now. We have a corrupt politics to the core, I’m afraid to say…But what’s it’s lead to is this sense of impunity that is really stunning, and you feel it on the individual level right now…I’ve waited for a judge, for our President, for somebody (to react to the way the system has been gamed), and it hasn’t happened, and by the way, it’s not gonna happen, anytime soon, it seems.”
What I have found is that Legislators who accept campaign contributions from the financial sector, create for themselves a conflict of interest, in dealing with abuses of the American equity market, perpetrated by their contributors. I think our only hope for systemic reform is through the Judiciary.
But as you know, I have not merely waited for a judge. I have petitioned for relief from a Federal Judge to obtain electronic trading records, which I feel may expose the type of abuses which are destroying the lives of many investors in the American equity market. That relief has been granted, for the records of a company in which I am a shareholder.
It is my hope now that this very sense of impunity, to which Dr. Sachs refers, will aid in my examination of the trading records that I have subpoenaed. In that regard, Dr. Sachs may be pleased to know that he is wrong. Judicial relief HAS been provided. It’s a start to systemic reform, and I am very grateful to the Judge who has made it possible.
April 29, 2013 6:37 pm
Austerity exposes the globalthreatfrom
tax havens
By Jeffrey Sachs
All eyes are turning to leaders to see whether they are beholdento the public’s needs, says
Jeffrey Sachs
The curtainhas beenpulled aside onthe once secret world oftax havens,
and the scale of abuse is nearly beyond reckoning.Week after week,
Americans andEuropeans worndownby budget austerity have learnt about
the secret accounts oftheir politicians,tax evasionby leading companies and
hot money destabilising the world economy.The darker truth is that these
havens are not gaps inthe world’s financial system;they are the system.
How many politicians and political parties have secret accounts abroad?
Inevitably, giventhe nature ofthe arrangements, we cannot say for certain–
but the list ofthose that have come to light is long. US presidential candidate
Mitt Romney was found to have huge wealth inthe CaymanIslands, never adequately explained.InFrance, Jérôme
Cahuzac has resigned indisgrace from his positionas budget minister following the revelationthat he held a secret
account inSwitzerland. He has since beencharged with tax fraud. Spain’s ruling party has been making payments
from secret Swiss accounts for years. One senior Greek politicianhas beensentenced to jail for falsifying financial
declarations.Many more revelations will come, especially now that investigative journalists have their hands onthe
records of hundreds ofthousands of offshore accounts.
Groups such as Apple, Google and Starbucks have beenshowninrecent months to have used outlandish accounting
gimmicks to shelter their profits.These include Google’s claim, approved by the US Internal Revenue Service,that its
intellectual capital resides inBermuda.There are thousands more like them working with the tax authorities to keep
their money out of reach.Banks such as HSBCand UBS have beencaught inthe money laundering that facilitates this
process.
How much tax revenue is lost to the global havens? Here,too, we canonly guess but the numbers are likely to be vast.
Recent estimates by the Tax Justice Network suggest that deposits are inthe range of $21tn.
The havens serve countless purposes, yet not one is for the social good.They support massive tax evasion.They
underpina global system of bribery to corrupt officials.They service the accounts of drug runners, arms traders and
terrorist groups.They create veils of secrecy through shell companies, which allow tax evasion, land grabs and
environmental destruction.
The prime movers ofthe world’s tax havens are the US, Switzerland and the UK.Indeed, many ofthe leading havens,
including the BritishVirginIslands,CaymanandBermuda, are British Overseas Territories.The secreting oftrillions
of dollars inthe Caribbeanhas beenundertaken with the support ofAmerica’s IRS, and with the approval ofthe US
political class andWall Street.
These playgrounds ofthe rich and powerful were largely hiddenfrom the public’s view during the long financial boom.
Inthe new world of austerity following the 2008 crash, however,they are increasingly seenas a cancer onthe global
financial system that must be excised.
The public’s animus was greatly accelerated by the Cyprus crisis.The island has for many years beena notorious
secrecy-and-tax haven, especially for Russian money.Yet this was winked at rather thancontrolled.ThenCyprus blew
up –a reminder of how anunregulated financial centre canquickly turninto a mortal threat to the world economy.
Many ofthe reforms that are required are obvious.All foreignbank accounts inany jurisdictionshould be reported
back to the national tax authorities ofthe account holders. Unreported incomes diverted to overseas accounts inthe
past should thenbe taxed at national rates with penalties for evasion.The thousands of hedge funds and corporations
domiciled inthe Caribbeanfor operations inthe US andEurope should be required to redomicile inthe US and
Europe.Beneficial ownership should be disclosed onall foreign-owned companies.
Angela Merkel,the Germanchancellor, François Hollande,the French president, and DavidCameron,the UKprime
minister, have recently acknowledged the need for a serious clampdown, yet the real actions still lie ahead.Barack
Obama,the US president, has spokeninthe past about cracking downbut has not said much recently.All eyes are
now turning to US andEuropeanleaders inadvance ofthe summits ofthe Group ofEight leading nations inJune and
the Group of 20 inSeptember to see whether the politicians are beholdento the needs ofthe public or to heedless
and destabilising private greed.
The writer is director ofthe Earth Institute and author ofthe forthcoming book, ‘To Move the World: JFK’s Quest
forPeace’
financial system that must be excised.
The public’s animus was greatly accelerated by the Cyprus crisis.The island has for many years beena notorious
secrecy-and-tax haven, especially for Russian money.Yet this was winked at rather thancontrolled.ThenCyprus blew
up –a reminder of how anunregulated financial centre canquickly turninto a mortal threat to the world economy.
Many ofthe reforms that are required are obvious.All foreignbank accounts inany jurisdictionshould be reported
back to the national tax authorities ofthe account holders. Unreported incomes diverted to overseas accounts inthe
past should thenbe taxed at national rates with penalties for evasion.The thousands of hedge funds and corporations
domiciled inthe Caribbeanfor operations inthe US andEurope should be required to redomicile inthe US and
Europe.Beneficial ownership should be disclosed onall foreign-owned companies.
Angela Merkel,the Germanchancellor, François Hollande,the French president, and DavidCameron,the UKprime
minister, have recently acknowledged the need for a serious clampdown, yet the real actions still lie ahead.Barack
Obama,the US president, has spokeninthe past about cracking downbut has not said much recently.All eyes are
now turning to US andEuropeanleaders inadvance ofthe summits ofthe Group ofEight leading nations inJune and
the Group of 20 inSeptember to see whether the politicians are beholdento the needs ofthe public or to heedless
and destabilising private greed.
The writer is director ofthe Earth Institute and author ofthe forthcoming book, ‘To Move the World: JFK’s Quest
forPeace’
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