My main gripe with TJN, and Attac, is that they do not seem to have a coherent philosophical background, tend to take swipes at straw figures, and assume that economics follows a very physics type causality.For instance:
a) Straw men and lack of rigour
Hidden proceeds of drug laundering is a good example of this. I've lost count of the number of times Mafia drug money millions or whatever is supposed to be concealed offshore is trotted out; I'd love to know what connections to the Mafia auditors they have in order to glean figures about something unseen. It is like saying that invisible men all have red hair, but they seem to get away with this complete lack of logical coherence. Rumors are accepted as facts far too easily (see example of Arafat's millions below), and talk of hidden millions seem to have the same function as talk of weapons of mass destruction: it gets media attention. It is little wonder that people do buy into the Nigeria scam about hidden millions if they can believe this kind of conspiracy culture. Incidentally, Grove Booklets has a good booklet on Christianity and Conspiracy Culture; it is not just with taxation and offshore, but across the whole spectrum, including all the stuff on the Gospel of Judas, Da Vinci Code, Hidden Vatican secrets etc.
They seem to have little or no idea as to what the money is doing in offshore centres, apart from supposedly evading tax! I'd also like to see some mention of matters like Asset holding vehicles, Asset protection, Avoidance of forced heirship provisions, Collective Investment Vehicles, Exchange control trading vehicles, Joint venture vehicles, together with an explanation of why those are bad, and deprive governments of taxation. Rather than the idea that offshore centres are some kind of bucket of money into which funds are placed, mostly by people wanting to hide proceeds of drugs etc which seems to be their idea.
b) Economic Determinism
They seem to assume that if the offshore centres were all closed, the money held there would flow back into national economies and be available for taxation. That argument gets repeated with tedious regularity. It assumes that no other variable come into play, which reminds me of Jersey looking at GST and keeping inflation down as if these were economically insulated policies with no overlap. What I suspect would happen if all offshore centres were closed would be less investment worldwide (more risk, less funding available), a depression, and less money available for tax in general. That might not be the case, but it is at least as credible an alternative, and TNJ and Attac should at least consider alternatives. The old theory of mercantalism which I remember Derek Cottrill teaching us about at school was that money was like a physical entity; if one country had more it would have to be at the expense of another. An idea which led to tariff barriers (the Corn Laws etc), the drive to retain the gold standard, but which turned out to be bogus (as the free trade movement showed). I can;t help thinking that with their idea of offshore as a bucket for funds, and their repatriation of funds helping reduce taxes, that they operate under this kind of crude thinking.
The death of Yasser Arafat (or "the dirty yellow bastard," as Don Imus calls him) occasioned a circus of comments on his "lost millions." The man was no sooner in the ground than reporters, producers, hangers-on, and the political flitterrati opined endlessly on his "hidden millions" -- or is it billions?
In fact, Arafat's "hidden millions" were so hidden that no one seemed to know exactly where they were. CNN said they were "in secret Swiss bank accounts" (and provided not one whit of evidence to prove it), Fox said they were "squirreled away from prying eyes" (privacy not being a right for Palestinians, it seems) while other newspapers and networks said that "secret Israeli and American intelligence reports" (though how these newspapers and networks knew this -- if they were so "secret" -- remains unknown) put his "hidden wealth" in the billions. Another report said that Arafat had invested in companies "linked"to Citigroup. One week after these reports the Swiss government reported that Mr. Arafat had no secret bank accounts and the Citigroup "links" (whatever that means) turned out to be false. So where exactly is all of Arafat's money?
It's in a bowling alley.
A report last week -- so important to the future of the world that it made the national news -- said that Arafat had invested in a Long Island bowling alley, called "Strike Long Island." But Strike Long Island was "just the tip of the iceberg," as it seemed that Arafat had part ownership in at least three other bowling establishments from Manhattan to Miami. Who knew? In all the years that I had known Arafat, I never knew that he had a "thing" for bowling. In all of this reporting, (I used the word advisedly) not one word was said about whether or not the money " invested by Arafat" was actually invested by him personally -- or whether it was invested by Palestinian financial institutions in which his top advisors had a formative role. The difference is significant: for while no one doubts that corruption has been endemic in the PA, no report that I have heard attributes such corruption to Arafat's overwhelming need for self-enrichment. In fact, just the opposite is the case.
Take the bowling alley. Arafat did not, as it turns out, invest any of the $1 million in the alley in his own name. The investment was made for him "through" Silverhaze Partners, a northern Virginia investment firm. Well, not really. As it turns out the investment was not made for him at all. It turns out that Silverhaze Partners did not receive the money from Arafat, but from Palestinian Commercial Services Company, a corporation whose interlocking directorate includes Saudis and Jordanians -- and one Palestinian. PCSC is a West Bank based Palestinian holding company in which Arafat had no shares and no control, though he did appoint Mohammad Rashid, a personal associate to oversee the company's activities. (In fact, Arafat's association with PCSC is far more tenuous than, say, Dick Cheney's with Halliburton.)
Through its investments, PCSC became a major shareholder in the Arab Palestinian Investment Company, whose assets are (and were) used to establish an automobile manufacturing and distribution company (to provide jobs for Palestinians), a medical supply company (to upgrade and modernize the Palestinian medical establishment), a shopping center development corporation, and a storage company. The funds invested by both the PCSC and the APIC are fully audited and tracked by U.S. Standards and Poors -- which has found the company to be solvent, transparent and well-run.
Of course the bowling alley report is fairly predictable: especially given that the PA's ability to run its own financial affairs has been notoriously lax. But of all the large houses, mansions really, that sprung up in Ramallah and in Gaza City in the wake of the Oslo agreements, I do not remember one being owned by Arafat. In fact, most of them are owned by those Palestinians the Americans and Israelis now call "reformers" -- one of the largest houses in Ramallah is owned by Mahmoud Abbas and Mohammed Dahlan (soon to be named the national security advisor in the PA's newly democratic and reformed administration) owns the largest house in Gaza. Arafat owned no houses and, so far as anyone can yet prove, does not now have and has never had any secret foreign bank accounts. So why the rash of stories on Arafat's personal corruption?
One of the reasons may be that Israeli authorities are talking about reopening what is delicately referred to as "the Ginosar Affair" -- in which Shimon Peres' financial advisor and boon buddy Yossi Ginosar took over a Palestinian owned casino and funneled money into (you guessed it) "a secret Swiss bank account" in order to help Palestinian Arabs engaged in small businesses. As you might imagine, not much of Ginosa''s monies ended up in Palestinian hands. Ginosar is also a good friend to Ariel Sharon, who appointed him to head the Israel Export Institute and has been implicated in a variety of political fundraising schemes on behalf of Peres and Ehud Barak. In all, some $350 million of Palestinian money was laundered through Swiss bank accounts, according to the Israeli newspaper Maariv, with the full knowledge if not the connivance of leading Israeli political figures.(5) Some of the money ended up earning interest in one of Israe's leading banks, according to these accounts.
Of course, the Bloomberg Report on Arafat's financial holdings (which were not, as it turned out, his financial holdings at all), failed to mention that corrupt Israelis have long been in bed with corrupt Palestinians -- and are still. It might come as a shock to most Americans that the cement used to build the "security barrier" between Israel and the West Bank is partly owned by Abu Ala, the PA's prime minister, that the settlements have been built by Palestinian laborers under contract to a Palestinian construction company, or that Ariel Sharon's son is a well-known partner in a number of Palestinian business that hold lucrative monopolies over staple products sold to poor Palestinian families -- but while all of this is shocking here, it is general knowledge in the West Bank, Gaza, and even in Israel.
Which does not answer the question as to why the demonization of Arafat continues. After all, it doesn't take a lot of research to find out who owns what and why in the West Bank, Gaza, and Israel. Obviously, Arafat is easy to blame -- he is our most recent devil. Or perhaps, too, blaming Arafat explains away some of the more uncomfortable political truths of the current situation in the Middle East. As Rabbi Scott Hoffman of the Lake Success Jewish Center said after hearing that his bowling ally might be owned by a man reputed to be our eras most notorious "terrorist": "The real sad part is the Palestinians are quite impoverished and he stole from his own people to enrich himself."
Ah, that's it: the Palestinians aren't impoverished because they're under occupation. No, no, no. They're dying and starving because of Arafat. It's their own damned fault
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