Panic is on the agenda at Davos – but it’s too little too late

The results of the rampant inequality engineered by the global elite are finally catching up with them writes Aditya Chakrabortty in The Guardian 


 
‘This backlash is uglier and more uncouth than anything you’ll see in the snow-capped Alps but the high rollers meeting there can claim exec producer credits for the whole rotten lot.’ Illustration: Nathalie Lees


Pity the poor billionaire, for today he feels a new and unsettling emotion: fear. The world order he once clung to is crumbling faster than the value of the pound. In its place, he frets, will come chaos. Remember this, as the plutocrats gather this week high above us in the ski resort of Davos: they are terrified.

Whatever dog-eared platitudes they may recycle for the TV cameras, what grips them is the havoc far below. Just look at the new report from the summit organisers that begins by asking plaintively, “Is the world sleepwalking into a crisis?” In the accompanying survey of a thousand bosses, money men (because finance, like wealth, is still mainly a male thing) and other “Davos decision-makers”, nine out of 10 say they fear a trade war or other “economic confrontation between major powers”. Most confess to mounting anxieties about “populist and nativist agendas” and “public anger against elites”. As the cause of this political earthquake, they identify two shifting tectonic plates: climate change and “increasing polarisation of societies”. 

In its pretend innocence, its barefaced blame-shifting, its sheer ruddy sauce, this is akin to arsonists wailing about the flames from their own bonfire. Populism of all stripes may be anathema to the billionaire class, but they helped create it. For decades, they inflicted insecurity on the rest of us and told us it was for our own good. They have rigged an economic system so that it paid them bonanzas and stiffed others. They have lobbied and funded politicians to give them the easiest of rides. Topped with red Maga caps and yellow vests, this backlash is uglier and more uncouth than anything you’ll see in the snow-capped Alps, but the high rollers meeting there can claim exec producer credits for the whole rotten lot. Shame it’s such a downer for dividends.

This week’s report from Oxfam is just the latest to put numbers to this hoarding of wealth and power. One single minibus-load of fatcats – just 26 people – now own as much as half the planet’s population, and the collective wealth of the billionaire class swells by $2.5bn every day. This economic polarisation is far more obscene than anything detested by Davos man, and it is the root cause of the social and political divide that now makes his world so unstable.

No natural force created this intense unfairness. The gulf between the super-rich and the rest of us did not gape wide open overnight. Rather, it has been decades in the widening and it was done deliberately. The UK was the frontline of the war to create greater inequality: in her first two terms as prime minister, Margaret Thatcher more than halved the top rate of income tax paid by high earners. She broke the back of the trade unions. Over their 16 years in office, Thatcher and John Major flogged off more public assetsthan France, Italy, Spain, Germany, Australia and Canada put together. 

Oh, shrug the Davos set, that’s ancient history. It is no such thing. Thatcher may be gone but her ideology keeps on taking cash out of your pay packets. If workers today got the same share of national income as in the 70s, we would be far better off. According to calculations from the Foundational Economy collective of researchers, a full-time employee now on the median salary of £29,574 would get a pay rise of £5,471.

Meanwhile, FTSE bosses enjoy skyrocketing pay, precisely because bonus schemes give them part-ownership of the big companies they run. So Jeff Fairburn of the housebuilder Persimmon took £47m in 2018 before getting the boot, which works out at £882 for each £1 earned by an average worker at the firm.

Where Thatcher’s shock troops led, the rest of the west more or less followed. Political leaders across the spectrum gave the rich what they wanted. It didn’t matter whether you voted for Tony Blair or David Cameron, Bill Clinton or George W Bush, either way you got Davos man. They cut taxes for top earners and for businesses, they uprooted the public sector to create opportunities for private firms, and they struck trade deals negotiated in secret that gave big corporations as much as they could ever dream of.

At last, more than a decade after the banking crash, the regime has run out of road. Hence the popular anger, so ferocious that the political and financial elites can neither comprehend nor control it. I can think of no better metaphor for the current disarray of the Davos set than the fact that Emmanuel Macron – surely the elite’s platonic ideal of a politician, with his eyes of leporid brightness, his stint as an investment banker and his start-up party – cannot attend this week’s jamboree because he has to stay at home and deal with the gilets jaunes. It’s a bummer when the working poor spoil your holiday plans.

None of this is to say that the 1% – holed up in their resort and fenced off from the world with roadblocks and men toting sharpshooters – don’t care about the immiseration of others. At Davos a couple of years ago, the New York Times reported that among the summit’s attractions was “a simulation of a refugee’s experience, where [conference] attendees crawl on their hands and knees and pretend to flee from advancing armies”. The article continued, “It is one of the most popular events every year.” 

They care about other people’s problems – so long as they get to define them, and it’s never acknowledged that they are a large part of the problem. Which they are. If they want capitalism to carry on, the rich will need to give up their winnings and cede some ground. That point evades them. Welcoming Donald Trump last year, Klaus Schwab, Davos’s majordomo, praised the bigot-in-chief’s tax cuts for the rich and said, “I’m aware that your strong leadership is open to misconceptions and biased interpretations.” The super-rich don’t hate all populists – just those who refuse to make them richer.

Cutting the ribbon on this new economic order back in the 80s, Ronald Reagan claimed that the nine most terrifying words in the English language were: “I’m from the government and I’m here to help.” A joke perhaps, but the intention was real enough. The last three decades have seen the political and economic elites hack away at our social scaffolding – rights, taxes and institutions. It proved profitable, for a while, but now it threatens their own world. And still they block the quite reasonable alternatives of more taxes on wealth, of more power for workers, of companies not run solely to enrich their owners. The solutions to this crisis will not be handed down from a mountain top to the grateful hordes: they will rely on us taking power for ourselves. Three decades after Reagan, the nine most laughable words in the English language are: “I’m from the elite and I’m here to help.”

Protein mania: the rich world’s new diet obsession

Why we can’t get enough when we already eat too much. By Bee Wilson in The Guardian


Are you getting enough protein? The question provides its own answer: if you are worrying about the amount of protein in your diet, then you are almost certainly eating more than enough. This is the paradox of our new protein obsession. For many people, protein has become a kind of secular unction: it instantly anoints any food with an aura of health and goodness. On the menu at the gym where I go, a salad niçoise is now repackaged as “high-protein tuna”. It comes without the usual capers or olives – those are items that merely add flavour, and who needs that?

On Pinterest, the lifestyle-sharing site, you can now choose “protein” as one of your interests in life, along with “cute animals” and “inspirational quotes”. In 2017, there were 64m Google searches for “protein”. Anxiety about protein is one of the things that drives a person to drink a flask of vitamin-padded beige slurry and call it lunch.

You merely need to visit a western supermarket today to see that many people regard protein as some kind of universal elixir – one food companies are profitably adding to anything they can. “When the Box Says ‘Protein’, Shoppers Say ‘I’ll take it’” was the headline of a 2013 article in the Wall Street Journal. In addition to the ubiquitous protein balls, protein bars and protein shakes, you can now buy protein noodles, protein bagels, protein cookies and – wait for it – protein coffee. Even foods that are naturally high in protein such as cheese and yoghurt are sold in protein-boosted versions. Strangest of all might be “protein water” – clear, fruit-flavoured drinks laced with whey protein, as if ordinary water was insufficiently healthy.

Around half of all UK consumers are apparently seeking to add “extra protein” to their diets, according to market research from the cereal brand Weetabix – which has also cashed in on our hunger for protein. The protein version of Weetabix – a 24-pack of which costs 50p more than the same-sized pack of original Weetabix – is worth £7m in sales per year.

In a way, there’s nothing strange in the fact that we see protein as valuable, because it is. Along with fat and carbohydrate, it is one of the three basic macronutrients, and arguably the most important. We could survive without carbohydrates, but fat and protein are essential. Protein is the only macronutrient to contain nitrogen, without which we cannot grow or reproduce. There are nine amino-acid proteins – the building blocks of human tissue – that we can only get from food. Without them, we could grow neither healthy hair and nails nor strong bones and muscle, and our immune system would be impaired. A child who lacks vital protein in the first five years of life will suffer from stunting and sometimes wasting, too, as the dreadful persistence of malnutrition in the developing world reminds us.

So the puzzle is not that we should crave protein, but that our protein anxiety has become so acute at a time when the average person in developed countries has a surfeit of protein in their diet – at least according to official guidelines, which recommend a minimum of 0.8g of protein a day per kilogram of body weight. According to 2015 data from the UN Food and Agriculture Organization, the average person in the US and Canada gets a full 90g a day, nearly twice the recommended amount. The average European is not far behind with 85g of protein a day, and the average Chinese person consumes 75g.

When we seek out extra protein to sprinkle over our diets, most of us in rich countries are fixating on “a problem that doesn’t exist”, said David L Katz, an American doctor and public health scholar who is the director of the Yale-Griffin Prevention Research Center. In his latest book, The Truth About Food, Katz notes that while the “mythology of protein tends to propagate the notion that more is better”, there are serious concerns that a very high protein intake over a lifetime can result in harm to the liver, kidneys and skeleton.

The current protein mania has partly come about because so many people now regard carbohydrates or fats (and sometimes both) with suspicion. In the current nutrition wars, protein has emerged as the last macronutrient left standing. But the whole “macronutrient fixation” is a “boondoggle” that has been calamitous for public health, Katz told me. “First they told us to cut fat. But instead of wholegrains and lentils, we ate low-fat junk food.” Then food marketers heard the message about cutting carbs and sold us protein-enriched junk foods instead. “When we talk about protein,” said Katz, “we are dissociating the nutrient from its food source.”

And yet still we try to get more protein. In this world of abundance, humans seem to be on an eternal quest for the one safe substance that we can consume in limitless quantities without gaining weight. Such is the appeal of Diet Coke.

Our protein anxiety drives us to take diets already high in meats, soya, sugars and ultra-processed foods and dose them with yet more meats, soya, sugary bars and ultra-processed foods because they are marketed to us as “protein” – even though many of these products are not even particularly high in protein.

There is something paradoxical about our collective protein worship. When we pay good money for protein-enhanced food, we hope it will lead us to better health (however that is defined). Yet our single-minded pursuit of protein – as a disembodied nutrient whose presence trumps all other considerations – can lead us to behave as if we have forgotten everything we knew about food.

The intensity of our protein obsession can only be understood as part of a wider series of diet battles that go back half a century. If we now thirst for protein as if it were water, it may be because the other two macronutrients – fats and carbohydrates – have each in turn been made to seem toxic in the public mind.

Official dietary guidelines in the US and UK still insist that a healthy diet is one founded on plenty of carbohydrates with limited quantities of fat, especially saturated fat. The rationale for this low-fat advice goes back to the landmark Seven Countries Study, conducted in the 1950s by the American physiologist Ancel Keys. Based on his observation of healthy, olive oil-eating Mediterranean populations, Keys argued that affluent westerners would suffer fewer cases of heart disease if they could limit consumption of saturated fats such as those found in butter, lard and meat.

But as interpreted in the modern supermarket, the low-fat diet often ended up being a high-sugar and high-refined-carbohydrate diet, which was not quite what nutritionists had originally envisaged. In recent years, the low-fat, high-carb orthodoxy has come under fierce attack. In 2015, a meta-analysis conducted by a team of Canadian researchers concluded that intake of saturated fat was not associated with raised risk of stroke, type 2 diabetes or death from heart disease. Vocal anti-sugar campaigners such as Gary Taubes – author of The Case Against Sugar – have argued that the true cause of our current epidemic of diet-related ill health is not in fact saturated fat, but refined carbohydrate.

While the low-fattists and the low-carbists continue to slug it out, protein comes out the winner as the one safe thing that most of the population feel they can still put their faith in, whether for weight loss or general health. We have to eat something, after all.

The current protein fetish is merely the latest manifestation of a far larger phenomenon that Michael Pollan memorably referred to as “nutritionism” around 10 years ago. For decades now, there has been a tendency to think about what we eat and drink in terms of nutrients, rather than real whole ingredients in all their complexity. A combination of diet fads and clever marketing has got us here. It doesn’t matter whether we fixate on “low fat” or “low carbs” or “high protein” – we are making the same old mistakes about nutrition in a new form.

For a while, on my kitchen counter, next to the jars of rice and flour, there was another canister made of black plastic, much larger than the others. Its label said “SOURCE OF HIGH QUALITY PROTEINS” in huge letters. In much smaller lettering it said “READY TO MIX PROTEIN POWDER WITH SWEETENERS” and listed three kinds of whey protein: whey protein isolate, whey protein concentrate and hydrolysed whey protein. When you opened it, a fake vanilla smell wafted into the air and you saw a whitish powder and a black plastic scoop.

This soulless canister of ultra-processed whey protein was something that I, as a food writer, never thought I would see in my kitchen. The macho aesthetic of the packaging made my heart sink. I am also no fan of artificial sweeteners, which I believe do no favours either to the palate or to gut bacteria. What’s more, I believe most people should be able to get the nutrients we need from a balanced diet, rather than through supplements.

But nothing forces you to bend your own principles like parenthood. I turned to whey protein in a state of mild desperation for my very tall youngest son, who plays competitive sport five or six days a week. Three square meals plus multiple snacks only scratched the surface of his appetite, and he was sometimes almost crying with hunger by dinnertime. My conversations with other sport parents suggest that it’s not uncommon to be at least a little bit obsessed with their child’s protein intake. We grumble that protein bars are a pointless rip-off – and then we buy another pack of them.

 

Vanilla protein powder. Photograph: Arisha Singh/Alamy

Protein means different things to different people. To some, it symbolises “weight loss”, while to others it means “muscles”. To me it appeared as a magical filling substance that just might help my son to be less ravenous.

I had read studies suggesting protein was the most filling – or satiating – of the three macronutrients, and wondered if more protein at breakfast could be the answer. I tried him on homemade waffles enriched with almonds and hidden eggs (at that point he wouldn’t countenance whole eggs) and the improvement in his energy levels was dramatic. It was a short step to making him occasional smoothies from half a scoop of whey protein with milk and bananas or frozen berries. Despite my unease at the powder, I could genuinely see the difference in his levels of fullness. When the canister was empty I didn’t replace it, but I still monitor my son’s protein intake.

Having “enough” protein in your diet to meet your basic needs is not necessarily the same as having the right amount for optimum health. When I asked David Katz how much protein a person should consume, he said certain people may indeed require more than the minimum recommendation of 0.8g per kilo of bodyweight – including athletes like my son. The problem is that once we start thinking more protein is automatically better, it can be hard to know when to stop. The idea that protein is synonymous with healthy eating leads many people to eat in disordered ways that are far from healthy, either for body or mind.

A couple of years ago, Sarah Shephard, a thirtysomething British sports journalist, realised she was obsessed with protein. On a typical day, she was eating three or four protein bars, hard-boiled eggs, meat, fish and non-starchy vegetables and a couple of protein shakes. Virtually the only carbs in her diet came from the protein bars and shakes. It reached the point where she had so little energy in the evenings because of the lack of calories in her body that she stopped going out.

Shephard’s protein obsession started when injury forced her to give up running. After she started doing boxing and circuits with a new trainer, he told her she should be eating more protein to help prevent future injuries. To start with, Shephard’s new low-carb, high-protein regime felt wonderful. She lost weight, gained muscle and became one of the many people at the gym clutching their sleek flask of protein shake like an amulet.

However, she noticed her thoughts about protein were becoming obsessive. Given the choice between an apple and a protein bar, she always chose the protein bar, even though at a rational level she knew that a piece of fresh fruit with its fibre and vitamins had a lot to recommend it over a processed snack. By the time she finally sought help from a sports nutritionist, he said he had never seen anyone with such an intensive fitness regime who ate so little carbohydrate. She was consuming 150g of protein a day, around 2.5g per kilo of bodyweight – far in excess of the upper limit recommended for bodybuilders by the US Academy of Nutrition and Dietetics.

Shephard slowly weaned herself back on to a more balanced diet that included a range of complex carbohydrates such as oats and brown rice. Despite her apprehension, she did not gain weight. When I spoke to her, Shephard had been eating a balanced diet for more than two years without any ill effects, and was a bit mystified as to how she had drifted into her protein fixation.

Encouraged by the marketers of high-protein foods, many people talk about whether we we have reached our daily target for “macros”, but we do not talk so much about how much is too much. Adding extra protein beyond our needs can be harmful for people with underlying kidney or liver problems, as the body can struggle to process the excess.

In 2017 there were sensationalist headlines around the world when Meegan Hefford, a 25-year-old Australian bodybuilder, died after consuming high amounts of protein shakes and supplements. Hefford hadn’t realised she was suffering from a condition called urea cycle disorder, which meant that her body couldn’t metabolise protein normally. Defenders of high-protein diets immediately attacked the coverage of the story, pointing out that Hefford’s condition was rare and that her death was not caused by protein per se. This was true, but it is also true that there is a significant minority of the population for whom a high-protein diet is not advisable. For the 13% or so of people who have chronic kidney disease, a large amount of protein from red meat can damage renal function.

Above and beyond its long-term effects on the body, a fixation with protein can become a form of eating disorder. Three years ago, the American psychologist Richard Achiro decided to study men in Los Angeles engaging in excessive use of protein powders as well as other supplements such as caffeine. Achiro conducted a survey of nearly 200 active men who were using workout supplements and found that, for many of them, protein use had become a “variant of disordered eating” that threatened their health.

These men felt under intense pressure to achieve bodies that were not just thin, but that exhibited a supposedly ideal ratio of fat to muscle. Three per cent of the sample group had been hospitalised as a result of excessive supplement use, yet they still viewed supplements as healthy. Eating disorders have complex causes: Achiro told me the men who were overusing protein supplements also tended to be suffering from body dissatisfaction, low self-esteem and a sense of insecurity about their own masculinity.

But they were not helped by the fact that the culture they lived in told them that when they replaced most of their meals with protein shakes, what they were doing was normal. Achiro found that it was hard for these men to recognise that their relationship with protein might have become a problem, “because those of us living in western society have been groomed to view a protein-rich diet as the apex of healthful eating”.

By 2001, Arla Foods, a vast European dairy cooperative with Danish headquarters, had used up all of the whey in Denmark. The company realised it would have to look further afield to meet the insatiable demand for whey protein. Arla signed a contract with SanCor, an Argentinian dairy company, to build a giant whey protein plant in the town of Porteña, to the north of Buenos Aires. When you order “warm protein pancakes” with blueberries at the gym, the odds are the protein will have come from a plant such as this.

It was David Jenkins, a Scottish track and field athlete and silver medallist at the Munich Olympics, who first had the idea of marketing whey protein as a “recovery optimiser” for athletes called ProOptibol. It was launched in health food stores in Southern California and Hawaii in early 1988. At first it was a niche product that found popularity among cyclists and triathletes. The formula for this original whey protein was called WPC 75. It was a byproduct from the Golden Cheese company, based in Corona, California – a giant factory that produced Monterey Jack and other American cheeses.

In just a few decades, whey protein has gone from waste product to aspirational lifestyle enhancer. Whey is the watery stuff left over during cheese-making after the curds are separated off. On traditional dairy farms, it was put to good use in anything from bread-making to pickles, but in the vast American cheese factories of the postwar years it came to be seen as an unwanted nuisance. In US dairy states such as Wisconsin, cheese factories dumped thousands of litres of whey in nearby rivers. It was only in the 1970s, after local authorities placed limits on the dumping of dairy waste, that cheese manufacturers realised they had to find a way to use up this annoying whey. The quality of whey powders – known as “popcorn whey” – was poor, and it was mostly used to feed pigs. The key technology that made whey protein possible was the development of ultrafiltration techniques to pre-concentrate the whey before it was dried. This was when whey protein started to be made on an industrial scale.

There is nothing on the average tub of whey protein to suggest it ever came from cheese, let alone from a cow. Whey manufacturers work on the assumption that consumers want it to be as close as possible to flavourless, to preserve the illusion that it is some kind of magic potion for humans. In its unadorned form, however, whey varies considerably in flavour. There are two kinds of whey: sweet whey made from rennet cheeses such as cheddar and mozzarella, and acid whey made from the likes of cottage cheese. Cheddar whey has a tendency to taste cardboardy, mozzarella whey is milky and whey from cottage cheese can be sour or reminiscent of cabbage broth. But in the finished product, all these flavours are evened out and disguised by the cloying scent of chocolate, artificial vanillin or salted caramel.

 

A selection of energy bars in a supermarket in New York, US. Photograph: Richard Levine/Alamy

Dairy whey protein has become a commodity that travels the world in 100kg sacks, generating vast profits, coordinated by GVCs (global value chains). Thanks to the shifting patterns of supply and demand, the protein shake a gymgoer in Tokyo drinks after lifting weights may have originated on a farm in Norway. The lowest-quality whey powder is called “permeate” and is mostly shipped to Asia, where it is made into infant formula. The higher-quality whey, called WPC 80 because it has an 80% protein content, travels the world to fuel our protein obsession. The global whey protein market is now a complex and hugely competitive global trade, forecast to reach $14.5bn by the year 2023: more than half as much as the global market in breakfast cereal.

Strolling through London at lunchtime a few weeks ago, I found myself walking down Bread Street, near St Paul’s Cathedral, which in medieval times was the site of the city’s bread market. Turning off Bread Street, I came upon a branch of Protein Haus, which claims to sell the “most amazing protein shakes you will ever taste”. The shakes have names such as Strawberry Warrior and Vegan Coffee Pump and Berry-Yatric, which must be a competitor for the most offensive food name ever. Protein Haus also sells protein foods such as “bliss balls” and indiscriminate steaming portions of various meats.

From Bread Street to Protein Haus – this sums up how our eating habits have changed in modern times. When I was in Protein Haus staring at the heaps of overcooked chicken, slabs of salmon and rows of whey protein shakes and vegan protein shakes, it suddenly occurred to me how crazy it is that we should treat all of these varied “protein” substances as if they were in some way identical. A scoop of ultra-processed whey is not, in fact, the same as a grilled salmon fillet, either in nutrition or in the experience of eating it. Salmon – even the farmed kind – will be high in omega-3 fatty acids and vitamin B12, whereas whey protein is low in vitamins and minerals (except for calcium) and fat-free. The only thing these foods have in common is that they tend to be fuel first and pleasure later (if at all).

At the same time, our reverence for protein as the one perfect nutrient tends to completely ignore how the protein we eat is produced, or what the environmental consequences of that production might be. Of the 90g of protein eaten each day by the average American, two-thirds is composed of animal products.

One irony of Britain’s obsession with protein is that we don’t actually produce very much of it. In fact, only 3% of arable land in Europe is given over to protein crops such as pulses, and Europe imports more than two-thirds of its animal feed. Much of the protein consumed in Europe is meat raised on materials that actually originate in South America or the US as soybean oil or other oilseeds and have to be shipped across the world. So long as we largely consume protein from animal sources, our obsession with protein is also likely to be bad for the planet.

At the end of September, at the Aldeburgh food festival in Suffolk, I had a lunch with Nick Saltmarsh, who runs Hodmedod, a company that works with British farmers to produce locally grown pulses. Saltmarsh told me he feels our mania for protein foods has gone so far that we sometimes can’t recognise real protein when it is right in front of us.

Vegetable proteins such as lentils and peas tend to be regarded as “low-quality” compared with meat, eggs and dairy. But Christopher Gardner, a professor of medicine at Stanford University, has argued that this “quality” argument is misleading. His great discovery was that all plant sources of protein – from peanuts to edamame beans – contain all essential amino acids. Admittedly they contain smaller concentrations of the amino acids than meat or eggs, but in the context of a plentiful and varied diet, this doesn’t matter.

The problem is partly that beans and lentils do not fit our tunnel-visioned conception of what protein is. Pulses such as lentils contain around 25% protein but also 25% carbohydrate – which makes them hard to categorise within the dogmatic categories of modern nutrition. Is the lentil a protein (good) or a carb (bad)?

When Saltmarsh takes his product range to food fairs, he finds that bodybuilders and fitness enthusiasts will sometimes pick up a packet of pea flour and say “ooh! Peas!” – because pea protein has become fashionable as a vegan alternative to whey. “But when they see that it also contains carbohydrate, they put it down again,” he said.

Some now shun any meal or snack that can’t be categorised as a “protein” fix. But they aren’t among the millions of people for whom a lack of protein is indeed a real and pressing problem – and who don’t tend to be the ones browsing pea protein at fitness fairs.

The word protein derives from the ancient Greek protos, meaning first. When a Dutch scientist called GJ Mulder first brought the term into use, in 1838, he proposed – rightly, as it turns out – that protein was a crucial substance in all animal bodies. But new research suggests protein is required not just in an absolute sense, but in a particular ratio to the other nutrients in our diets.

Going by official guidelines, as we’ve seen, the average person has access to more than enough protein for general health. It turns out our perplexing protein obsession may actually be a symptom of a larger problem in our sugar-heavy modern diets: if it feels like we are not eating enough protein, it’s because we’re eating too much of everything else.

In 2005, two biologists called David Raubenheimer and Stephen Simpson put forward the “protein leverage hypothesis”, in which they argued that protein could be the missing link in the obesity crisis. Since the 1960s, the absolute level of protein consumed by the average westerner has not changed. What has changed is the ratio of protein in our diets.

Because our overall calorie consumption has risen by 14%, the ratio of protein to carbohydrate and fat has significantly dropped. In 1961, the average American got around 14-15% of calories in the form of protein, whereas today it is 12.5%. This doesn’t sound like a big drop, but Raubenheimer and Simpson’s research suggests that even a small drop in the percentage of protein can have a big impact on eating behaviour – driving us to overeat.

 

Salmon steaks at a Carrefour supermarket in Calais, France. Photograph: Gary Calton for the Observer

Like many other animals, humans have what biologists call a “dominant appetite” for protein. The biological drive for protein is so strong that a cricket who feels short of protein will resort to cannibalism. When a locust is short of protein, it will explore different food sources to redress the balance. Humans are neither as ruthless as crickets nor as prudent as locusts. When given access to a diet that is low on protein and heavy in carbs and fats, humans will binge, in an attempt to extract the protein they need.

If many of us overeat, it could be partly because our bodies are desperately seeking out protein in a food environment flooded with refined wheat and oils and many kinds of sugar. As Raubenheimer and Simpson wrote in their startlingly original 2012 book The Nature of Nutrition: “Dilution of protein in the diet by fat and carbohydrate drives excess consumption, perhaps more so in some individuals, life stages and populations than others.” In other words, obesity may often really be hunger hiding in plain view.

The urgent question raised by this research is how we can get our protein ratios back to a healthy level. Our current protein mania – encouraged by the food business and the whey protein industry – suggests that the answer is to supercharge our diets with a flood of added protein. But eating protein to excess comes with its own costs, the main one being that it tends to shorten the lifespan.

A more effective way to concentrate protein in our diets, Raubenheimer and Simpson say, would be to keep our protein levels constant (assuming we have enough) but cut down on “fat, sugar and other readily digested carbohydrates”, which would allow us to reach the protein our bodies need at a lower level of calories. But given that sugar is poured into everything from bread to stir-fry sauces, this solution would require a radical restructuring of our food environment.

Our protein needs do not remain constant over the human lifespan: 0.8g per kilogram of bodyweight may be enough for a twentysomething, but not for an octogenarian. If anyone needs extra protein, it is not fit young gymgoers, but old people – particularly those on low incomes who may struggle to buy or cook meals for themselves. Instead of protein bars for the young and rich, we need omelettes and chickpea soup for the old and poor. From the age of 50 onwards we progressively lose muscle and our protein requirements become higher, just as appetite tends to decline. Rates of protein malnutrition are alarmingly high among elderly people admitted to hospital.

Most of those who can afford to buy a “high-protein” tuna plate are already well nourished in amino acids. By contrast, in these austere times, many hard-pressed eaters are forced into a kind of protein hunger by the economic circumstances of their lives. Think of the families who go to the chip shop and buy chips with no fish, or the person on universal credit living on plain pasta until the next cheque comes in. This is one reason there is a huge market for savoury snacks that taste like a ghostly echo of the hearty, protein-based meals of the past while consisting of little but refined carbs and oil: roast chicken flavour crisps, barbecue tortilla chips. Raubenheimer and Simpson’s research suggests that the colossal market for these cheap snacks could be another symptom of a world in which – despite all those bars and shakes on the shelves – many are still hungry for protein.

Behind the current protein hype, there is a kernel of truth. A deficit of protein is indeed part of the hugely complex puzzle of what’s wrong with modern diets. The problem is that the right question – am I getting enough protein? – is being asked by the wrong people.

Citizenship for sale: how tycoons can go shopping for a new passport

Jon Henley in The Guardian


It’s the must-have accessory for every self-respecting 21st-century oligarch, and a good many mere multimillionaires: a second – and sometimes a third or even a fourth – passport.

Israel, which helped Russian billionaire Roman Abramovich out of a spot of bother this week by granting him citizenship after delays in renewing his expired UK visa, offers free nationality to any Jewish person wishing to move there.

But there are as many as two dozen other countries, including several in the EU, where someone with the financial resources of the Chelsea football club owner could acquire a new nationality for a price: the global market in citizenship-by-investment programmes – or CIPs as they are commonly known – is booming.

The ‘golden visa’ deal: ‘We have in effect been selling off British citizenship to the rich’



The schemes’ specifics – and costs, ranging from as little as $100,000 (£74,900) to as much as €2.5m (£2.19m) – may vary, but not the principle: in essence, wealthy people invest money in property or businesses, buy government bonds or simply donate cash directly, in exchange for citizenship and a passport.

Some do not offer citizenship for sale outright, but run schemes usually known as “golden visas” that reward investors with residence permits that can eventually lead – typically after a period of five years – to citizenship.

The programmes are not new, but are growing exponentially, driven by wealthy private investors from emerging market economies including China, Russia, India, Vietnam, Mexico and Brazil, as well as the Middle East and more recently Turkey.

The first launched in 1984, a year after young, cash-strapped St Kitts and Nevis won independence from the UK. Slow to take off, it accelerated fast after 2009 when passport-holders from the Caribbean island nation were granted visa-free travel to the 26-nation Schengen zone.

For poorer countries, such schemes can be a boon, lifting them out of debt and even becoming their biggest export: the International Monetary Fund reckons St Kitts and Nevis earned 14% of its GDP from its CIP in 2014, and other estimates put the figure as high as 30% of state revenue.

Wealthier countries such as Canada, the UK and New Zealand have also seen the potential of CIPs (the US EB-5 programme is worth about $4bn a year to the economy) but sell their schemes more around the attractions of a stable economy and safe investment environment than on freedom of movement.

Experts from the many companies, such as Henley and Partners, CS Global and Apex, now specialising in CIPs and advertising their services online and in inflight magazines, say that unlike Abramovich, relatively few of their clients buy citizenship in order to move immediately to the country concerned. 

For most, the acquisition represents an insurance policy: with nationalism, protectionism, isolationism and fears of financial instability on the rise around the world, the state of the industry serves as an effective barometer of global political and economic uncertainty.
But CIPs are not without their critics. Malta, for example, has come under sustained fire from Brussels and other EU capitals for its programme, run by Henley and Partners, which according to the IMF saw more than 800 wealthy individuals gain citizenship in the three years following its launch in 2014.

Critics said the scheme was undermining the concept of EU citizenship, posing potential major security risks, and providing a possible route for wealthy individuals – for example from Russia – with opaque income streams to dodge sanctions in their own countries.

Several other CIPs have come under investigation for fraud, while equality campaigners increasingly argue the moral case that it is simply wrong to grant automatic citizenship to ultra-high net worth individuals when the less privileged must wait their turn – and, in many cases, be rejected.

The Caribbean

The best-known – and cheapest – CIP schemes are in the Caribbean, where the warm climate, low investment requirements and undemanding residency obligations have long proved popular. Five countries currently offer CIPs, often giving visa-free travel to the EU, and have recently cut their prices to attract investors as they seek funds to help them rebuild after last year’s hurricanes. In St Kitts and Nevis a passport can now be had for a $150,000 donation to the hurricane relief fund, while Antigua, Barbuda and Granada have cut their fees to $100,000, the same level as St Lucia and Dominica.

Europe

Almost half of the EU’s member states offer some kind of investment residency or citizenship programme leading to a highly prized EU passport, which typically allows visa-free travel to between 150 and 170 countries. Malta’s citizenship-for-sale scheme requires a €675,000 donation to the national development fund and a €350,000 property purchase. In Cyprus the cost is a €2m investment in real estate, stocks, government bonds or Cypriot businesses (although the number of new passports is to be capped at 700 a year following criticism). In Bulgaria, €500,000 gets you residency, and about €1m over two years plus a year’s residency gets you fast-track citizenship. Investors can get residency rights leading longer term to citizenship – usually after five years, and subject to passing relevant language and other tests – for €65,000 in Latvia (equities), €250,000 in Greece (property), €350,000 or €500,000 (property or a small business investment fund) or €500,000 in Spain (property, and you have to wait 10 years to apply for citizenship).

Rest of the world

Thailand offers several “elite residency” packages costing $3,000-$4,000 a year for up to 20 years residency, some including health checkups, spa treatments and VIP handling from government agencies. The EB-5 US visa, particularly popular with Chinese investors, costs between €500,000 and $1m depending on the type of investment and gives green card residency that can eventually lead to a passport. Canada closed its CA$800,000 (£460,000) federal investment immigration programme in 2014 but now has a similar residency scheme, costing just over CA$1m, for “innovative start-ups”, as well as regional schemes in, for example, Quebec. Australia requires an investment of AU$1.5m (£850,000) and a net worth of AU$2.5m for residency that could, eventually, lead to citizenship, and New Zealand – popular with Silicon Valley types – an investment of up to NZ$10m (£5.2m).

Men Only: Inside the charity fundraiser where hostesses are put on show

Madison Marriage in The Financial Times

At 10pm last Thursday night, Jonny Gould took to the stage in the ballroom at London’s Dorchester Hotel. “Welcome to the most un-PC event of the year,” he roared. 

Mr Gould — who presented Channel 5’s Major League Baseball show — was there to host a charity auction, the centrepiece of a secretive annual event, the Presidents Club Charity Dinner. 

The gathering’s official purpose is to raise money for worthy causes such as Great Ormond Street Hospital, the world-renowned children’s hospital in London’s Bloomsbury district. 

Auction items included lunch with Boris Johnson, the British foreign secretary, and afternoon tea with Bank of England governor Mark Carney. 

But this is a charity fundraiser like no other. 

Auction lots included a lunch with foreign secretary Boris Johnson and former England cricketer Ian Botham. 

It is for men only. A black tie evening, Thursday’s event was attended by 360 figures from British business, politics and finance and the entertainment included 130 specially hired hostesses. 

All of the women were told to wear skimpy black outfits with matching underwear and high heels. At an after-party many hostesses — some of them students earning extra cash — were groped, sexually harassed and propositioned. 

The event has been a mainstay of London’s social calendar for 33 years, yet the activities have remained largely unreported — unusual, perhaps, for a fundraiser of its scale. 

The questions raised about the event have been thrown into sharp relief by the current business climate, when bastions of sexual harassment and the institutionalised objectification of women are being torn down. 

The Financial Times last week sent two people undercover to work as hostesses on the night. Reporters also gained access to the dining hall and surrounding bars. 

Over the course of six hours, many of the hostesses were subjected to groping, lewd comments and repeated requests to join diners in bedrooms elsewhere in the Dorchester. 

Hostesses reported men repeatedly putting hands up their skirts; one said an attendee had exposed his penis to her during the evening. 

WPP, the FTSE 100 advertising conglomerate, sponsored a table at the event as it has in previous years. Martin Sorrell, chief executive, was not present this year — though he has attended in the past. 

Andrew Scott, its chief operating officer for Europe, hosted the table in his absence. Other table sponsors included CMC Markets, the UK-listed spread betting company, and Frogmore, the London-based real estate investment business. 

A seating plan for last week’s event seen by the FT listed those due to attend as including well-known British business figures such as Philip Green of Arcadia Group, Dragons’ Den star Peter Jones, and Ocado boss Tim Steiner. 

Financiers on the seating plan included Henry Gabay, founder of hedge fund Duet Group, and Makram Azar, the head of Barclays’ investment bank’s Middle East business. From the world of politics were Nadhim Zahawi, newly appointed undersecretary of state for children and families, and Jonathan Mendelsohn, a Labour peer and party fundraiser. It is not clear whether those listed all turned up on the night. 

The comedian David Walliams was the host for the evening. Previous attendees have included Michael Sherwood, a former vice-chairman of Goldman Sachs, and Poju Zabludowicz, a Finnish real estate billionaire and Conservative party donor. 

Current and past supporters provide a roll call of British wealth and business influence: patrons include high-end developer Nick Candy; former Formula 1 magnate Bernie Ecclestone; and TV presenter Vernon Kay. CMC Markets founder Peter Cruddas is also a regular attendee. 

The event has a laudable fundraising aim with prestigious prizes offered for auction. During the three decades The Presidents Club has been running, it has raised more than £20m for charity. Thursday’s event alone raised more than £2m. 

The organisation’s charitable trust has two joint chairmen: Bruce Ritchie, a Mayfair property developer who founded Residential Land, and David Meller, from the luxury good specialist Meller Group, who also sits on the board of the Department for Education and the Mayor’s Fund for London. 

But the auction offers a hint of the evening’s seedier side. Lots included a night at Soho’s Windmill strip club and a course of plastic surgery with the invitation to: “Add spice to your wife.” 

The accompanying brochure included a full-page warning that no attendees or staff should be sexually harassed. The glossy auction catalogue distributed to attendees during the evening included multiple images of Marilyn Monroe dressed in revealing, tight dresses. 

The nature of the occasion was hinted at when the hostesses were hired. The task of finding women for the dinner is entrusted to Caroline Dandridge, founder of Artista, an agency specialising in hosts and hostesses for what it claims to be some of the “UK’s most prestigious occasions”. 

At their initial interviews, women were warned by Ms Dandridge that the men in attendance might be “annoying” or try to get the hostesses “pissed”. One hostess was advised to lie to her boyfriend about the fact it was a male-only event. “Tell him it’s a charity dinner,” she was told. 

“It’s a Marmite job. Some girls love it, and for other girls it’s the worst job of their life and they will never do it again . . . You just have to put up with the annoying men and if you can do that it’s fine,” Ms Dandridge told the hostess. 

Two days before the event, Ms Dandridge told prospective hostesses by email that their phones would be “safely locked away” for the evening and that boyfriends and girlfriends were not welcome at the venue. 

The uniform requirements also became more detailed: all hostesses should bring “BLACK sexy shoes”, black underwear, and do their hair and make-up as they would to go to a “smart sexy place”. Dresses and belts would be supplied on the day. 

For those who met the three specific selection criteria (“tall, thin and pretty”) a job paying £150, plus £25 for a taxi home, began at 4pm. 

The backgrounds of the dozen or more hostesses met by reporters were varied: many were students, hoping to launch careers as lawyers or marketing executives; others juggled part-time jobs as actresses, dancers or models and did occasional hostessing work to make ends meet. 

Upon arrival at the Dorchester, the first task given to the hostesses was to sign a five-page non-disclosure agreement about the event. Hostesses were not given a chance to read its contents, or take a copy with them after signing. 

At first, hostesses were assembled in the Dorchester’s Orchard Room, where a team of hair and make-up artists prepped women for the evening ahead. During the pre-event preparations, some of the women new to hostess work sought advice from those with more experience. The feedback was mixed. 

A number of the hostesses seemed excited about the evening ahead. It was a fun night, they said, especially as — unlike most hostessing assignments — you could drink on the job. 

One experienced hostess acknowledged that a portion of the men were likely to be “arseholes”, but said others were “hilarious”. “It really depends on the luck of the draw,” she added. 

Others were more apprehensive. One woman who had last worked at the event five years ago sighed to herself: “I can’t believe I’m here again.” 

Towards 7pm, during a staff buffet dinner, Ms Dandridge entered wearing a smart black suit and gave a briefing; she said if any of the men became “too annoying”, the hostesses should contact her. 

Hostess uniforms were distributed — short tight black dresses, black high heels and a thick black belt resembling a corset. Once dressed, the hostesses were offered a glass of white wine during the final countdown to their entrance into the ballroom. 

As the 8pm start time approached, all of the hostesses were told to form two lines in height order, tallest women first, ready to parade across the stage as music began to boom across the venue: “Power”, by British girl band Little Mix. 

Entering in twos from opposite sides on to a stage positioned at the front of the ballroom, hostesses presented themselves to the men before walking towards their allocated tables alongside dinner guests. This continued until all 130 women were spread across the room. 

With the dinner properly under way, the hostess brief was simple: keep this mix of British and foreign businessmen, the odd lord, politicians, oligarchs, property tycoons, film producers, financiers, and chief executives happy — and fetch drinks when required. 

A number of men stood with the hostesses while waiting for smoked salmon starters to arrive. Others remained seated and yet insisted on holding the hands of their hostesses. 

It was unclear why men, seated at their tables with hostesses standing close by, felt the need to hold the hands of the women, but numerous hostesses discussed instances of it through the night. For some, this was a prelude to pulling the women into their laps. Meanwhile champagne, whisky and vodka were served. 

On stage, entertainers came and went. It was soon after a troupe of burlesque dancers — dressed like furry-hatted Coldstream Guards, but with star-shaped stickers hiding nipples — that one 19-year-old hostess, recounted a conversation with a guest nearing his seventies: who had asked her, directly, whether she was a prostitute. She was not. “I’ve never done this before, and I’m never doing it again,” she said later. “It’s f***ing scary.” 

According to the accounts of multiple women working that night, groping and similar abuse was seen across many of the tables in the room. 

Another woman, 28, with experience of hostess work, observing the braying men around her said this was significantly different to previous black tie jobs. At other events, men occasionally would try to flirt with her, she said, but she had never felt uncomfortable or, indeed, frightened. 

She reported being repeatedly fondled on her bottom, hips, stomach and legs. One guest lunged at her to kiss her. Another invited her upstairs to his room. 

Meanwhile, Artista had an enforcement team, made up of suited women and men, who would tour the ballroom, prodding less active hostesses to interact with dinner guests.

Outside the women’s toilets a monitoring system was in place: women who spent too long were called out and led back to the ballroom. A security guard at the door was on hand, keeping time. 

At 10pm, the main money-raising portion of the evening got under way: the charity auction, where the lots on offer ranged from a supercharged Land Rover to the right to name a character in Mr Walliams’ next children's book. 

Richard Caring, who made his fortune in the retail sourcing business before scooping up a long list of London’s most fashionable restaurants, including The Ivy and Scott’s, rounded off the money-raising portion of the evening with a successful £400,000 bid to place his name on a new High Dependency Unit at the Evelina London children’s hospital for sick children. 

It was a moment of respite for the women, most of whom had been allowed to return to the Orchard Room. Some were excited to have been offered jobs by men in the room. Others had been offered large tips, which they had been obliged to decline. One woman struggled to re-apply her eyeliner. “I’m so drunk,” she said apologetically, blaming tequila shots at her table. 

The women filed back into the ballroom at 11pm for the final hour of the main event, which would be followed by an “after-party” elsewhere in the hotel. 

Most hostesses had been told they would be required to stay until 2am. One was told that this final leg of the evening offered a chance to drink what she wanted and seek out those men she found “most attractive”. 

The after-party was held in a smaller room off the main lobby at the Dorchester, packed tight with guests and women. 

According to the 28-year-old hostess, while men danced and drank with a set of women on one side of the room, a line of younger women were left seated on a banquette at the back of the room, seemingly dazed. “They looked shocked and frightened, exhausted by what had happened,” she said. 

Meanwhile, in the centre of the room, Jimmy Lahoud, 67, a Lebanese businessman and restaurateur, danced enthusiastically with three young women wearing bright red dresses. 

“You look far too sober,” he told her. Filling her glass with champagne, he grabbed her by the waist, pulled her in against his stomach and declared: “I want you to down that glass, rip off your knickers and dance on that table.”

In a statement the Dorchester said it had a zero-tolerance policy regarding harassment of guests or employees. “We are unaware of any allegations and should we be contacted we will work with the relevant authorities as necessary,” it said. 

The Presidents Club said: “The Presidents Club recently hosted its annual dinner, raising several million pounds for disadvantaged children. The organisers are appalled by the allegations of bad behaviour at the event asserted by the Financial Times reporters. Such behaviour is totally unacceptable. The allegations will be investigated fully and promptly and appropriate action taken.” 

Ms Dandridge of Artista stated: “This is a really important charity fundraising event that has been running for 33 years and raises huge amounts of money for disadvantaged and underprivileged children’s charities. There is a code of conduct that we follow, I am not aware of any reports of sexual harassment and with the calibre of guest, I would be astonished.” 

None of the trustees of the charity provided a comment for publication. 

Harvey Goldsmith, a former trustee, said he was “gobsmacked” by the accounts of sexual harassment taking place at the event. “I’m totally shocked to be quite frank,” he said. 

The BoE said: “The Bank of England did not approve any prize for auction on the occasion described nor would it have for that organisation under its guidelines for charitable giving.” 

Mr Walliams declined to comment. 

Mr Caring said he “was not aware of any of the alleged incidents”. 

Barry Townsley, a well-known stockbroker and lifetime president of The Presidents Club who helped to set up the charity, said he had not attended the dinner for a decade. He added that it was previously “very nice and civilised” and a “mild-mannered charity”. “What goes on now is not my business,” he said.

Tax evaders exposed: The HSBC Files

Annette Alstadsæter, Niels Johannesen and Gabriel Zucman in The Guardian


The statistics on inequality – those used, for instance, in Thomas Piketty’s bestseller, Capital in the Twenty-First Century – only include the income and wealth the taxman sees. So how high is inequality when also accounting for what he doesn’t see? Recent leaks from tax havens suggest the gap between the rich and the rest is even wider than we think.
Tax records are invaluable for the study of economic inequality. They contain detailed information about the income (and, in some countries, wealth) of taxpayers. Much of this information comes directly from employers and banks, and is therefore reliable. And because tax records exist as far back as the early 20th century, they can be used to shed light on the long-term evolution of inequality.

The graphs published on the World Wealth and Income Database, for example, show just how powerfully this information can inform the public debate. The top 1% income share is now closely scrutinised by journalists and policymakers in the US, where the rise of inequality has been particularly extreme; it even gave the Occupy movement its motto: “We are the 99%.”

But for all their merits, tax data raise an obvious issue: by their very nature, they entirely miss tax evasion. Is this a serious problem? That depends: if tax evasion is equally prevalent among rich and poor, measured inequality will be unaffected. But if the rich dodge taxes more than others, tax records will underestimate inequality.

At the time of the 2007 leak, HSBC Switzerland was a major actor in the offshore wealth management industry. Photograph: Harold Cunningham/Getty Images

Before now, there hadn’t been any attempts to address the measurement of global tax evasion systematically. The reason is simple: the lack of comprehensive information about who skirts taxes. The key data source used in rich countries to study tax evasion is random tax audits – but these audits do not capture tax evasion by the very wealthy, because few of them are audited, and because random audits fail to detect sophisticated forms of evasion involving shell companies and hidden accounts.


The higher one moves up the wealth distribution, the higher the probability ​​of hiding​ assets

In our recent study, however, we exploited a massive trove of data leaked from HSBC Switzerland, the so-called HSBC files, to fill this gap. In 2007 a systems engineer, Hervé Falciani, extracted the internal records of HSBC Private Bank, the Swiss subsidiary of HSBC. In 2008, Falciani turned the data over to the French government, who shared it with foreign tax administrations. The documents leaked by Falciani included the complete internal records of more than 30,000 clients of this Swiss bank in 2006-07.

At the time of the leak, HSBC Switzerland was a major actor in the offshore wealth management industry. It managed US$118.4bn – about 4% of all the foreign wealth managed by Swiss banks. This is a unique source of information through which to study tax evasion, because the leak can be seen as a random event, and it comes from a large (and, the available evidence suggests, representative) offshore bank.

We also made use of the Panama Papers, which last year revealed the identity of the shareholders of shell companies created by the Panamanian firm Mossack Fonseca. Just as with HSBC, this leak is valuable as it can be seen as a random event and involves a prominent provider of offshore financial services. The Panama Papers, however, have one drawback: they do not allow us to estimate how much tax was evaded (if any) by the owners of the Mossack Fonseca shell companies. It is not illegal per se to own shell corporations in Panama or elsewhere.

  Leaked documents revealed the identity of the shareholders of the shell companies created by the Panama-based law firm Mossack Fonseca. Photograph: Kin Cheung/AP

We combined random audits with these new sources of information to shed light on who really evades taxes in Denmark, Norway and Sweden – and the results are striking.

The higher one moves up the wealth distribution, the higher the probability of hiding assets. Scandinavian households in the top 0.01% of the wealth pyramid – the ultra-rich, who own more than $40m in net wealth each – are 250 times more likely than average to hide assets. Furthermore, the ultra-rich HSBC customers had considerably more wealth in their accounts than other customers – so although they were very few in number, they owned around half of all the wealth hidden at HSBC.


In Norway, the super-wealthy appear to be 30% wealthier when all the wealth hidden in tax havens is taken into account

This pattern is not specific to HSBC or the Panama Papers. Over the last few years, thousands of Norwegians and Swedes have voluntarily declared previously hidden assets under a tax amnesty. Here again, the super-rich are found to own half of the total amount of offshore wealth.

So what are the consequences for inequality? At the very top of the pyramid, it is much greater than previously estimated. In Norway, where the available wealth data is particularly detailed, the super-wealthy appear to be 30% wealthier than previously thought, when all the wealth hidden in tax havens is taken into account. The share of wealth owned by the top 0.1% increases from 8% to 10%.

Since Scandinavians generally pay their taxes and hide little wealth in total, our results are likely to be even stronger in Great Britain and elsewhere. A more accurate measurement of tax evasion would likely increase inequality levels even more than in Scandinavia.

These results underscore a basic truth: in a world where wealth is globalised and where a big industry has specialised in helping the ultra-rich avoid and sometimes evade their taxes, our ability to track great fortunes – and to tax them appropriately – faces considerable challenges.

But does this mean nothing can be done? Not at all.

It is possible to collect much better information on wealth and its distribution. Progress has already started in this area, as a number of tax havens have agreed to automatically exchange bank information with foreign countries’ tax authorities – a major evolution since the time of the HSBC leak.

But this policy faces an obvious issue: what are the incentives for offshore bankers to provide truthful information? After all, these are the same people who for decades have been hiding their clients behind shell companies, and sometimes even smuggling diamonds in toothpaste tubes or handing out bank statements concealed in sports magazines – all of this in violation of the law and the banks’ stated policies. Yet it still should be possible to secure their cooperation, if they face stiff enough sanctions for non-compliance.

More broadly, the key to successfully fighting tax evasion is to change the incentives for the providers of wealth concealment services. Over the last few years, a number of banks have pleaded guilty in the US to criminal conspiracies to defraud the Internal Revenue Service – yet they were able to keep their banking licences, and the fines they had to pay paled in comparison to their profits. A more ambitious approach would put criminal organisations out of business. If tax evasion ceases to pay, it will disappear.

Global Capitalism: Trump’s Big Economic Plans Fade

Richard D Wolff - Economics Professor (retired)  April 2017

March 2017

Freedom for whom, at whose expense?

George Monbiot in The Guardian


‘When thinktanks and the billionaire press call for freedom, they are careful not to specify whose freedoms they mean. Freedom for some, they suggest, means freedom for all.’ Photograph: Dan Kitwood/Getty Images




Propaganda works by sanctifying a single value, such as faith, or patriotism. Anyone who questions it puts themselves outside the circle of respectable opinion. The sacred value is used to obscure the intentions of those who champion it. Today, the value is freedom. Freedom is a word that powerful people use to shut down thought.

When thinktanks and the billionaire press call for freedom, they are careful not to specify whose freedoms they mean. Freedom for some, they suggest, means freedom for all. In certain cases, this is true. You can exercise freedom of thought, for instance, without harming others. In other cases, one person’s freedom is another’s captivity.

When corporations free themselves from trade unions, they curtail the freedoms of their workers. When the very rich free themselves from tax, other people suffer through failing public services. When financiers are free to design exotic financial instruments, the rest of us pay for the crises they cause.

Above all, billionaires and the organisations they run demand freedom from something they call “red tape”. What they mean by red tape is public protection. An article in the Telegraph last week was headlined “Cut the EU red tape choking Britain after Brexit to set the country free from the shackles of Brussels”. Yes, we are choking, but not on red tape. We are choking because the government flouts European rules on air quality. The resulting air pollution frees thousands of souls from their bodies.

‘Yes, we are choking, but not on red tape. We are choking because the government flouts European rules on air quality.’ Photograph: Stefan Rousseau/PA

Ripping down such public protections means freedom for billionaires and corporations from the constraints of democracy. This is what Brexit – and Donald Trump – are all about. The freedom we were promised is the freedom of the very rich to exploit us. 

To be fair to the Telegraph, which is running a campaign to deregulate the entire economy once Britain has left the EU, it is, unusually, almost explicit about who the beneficiaries are. It explains that “the ultimate goal of this whole process should be to … set the wealth creators free”. (Wealth creators: code for the very rich.) Among the potential prizes it lists are changes to the banana grading system, allowing strongly curved bananas to be categorised as Class 1, a return to incandescent lightbulbs and the freedom to kill great crested newts.

I suspect that the Barclay brothers, the billionaires who own the Telegraph, couldn’t give a monkey’s about bananas. But as their business empire incorporates hotels, shipping, car sales, home shopping and deliveries, they might be intensely interested in the European working time directive and other aspects of employment law, tax directives, environmental impact assessments, the consumer rights directive, maritime safety laws and a host of similar public protections.

If the government agrees to a “bonfire of red tape”, we would win bent bananas and newt-squashing prerogatives. On the other hand, we could lose our rights to fair employment, an enduring living world, clean air, clean water, public safety, consumer protection, functioning public services, and the other distinguishing features of civilisation. Tough choice, isn’t it?


The overriding of the safety mechanism on a ride at Alton Towers led to two young women having their legs amputated

As if to hammer the point home, the Sunday Telegraph interviewed Nick Varney, chief executive of Merlin Entertainments, in an article claiming that the “red tape burden” was too heavy for listed companies. He described some of the public protections that companies have to observe as “bloody baggage”. The article failed to connect these remarks to his company’s own bloody baggage, caused by its unilateral decision to cut red tape. As a result of overriding the safety mechanism on one of its rides at Alton Towers – which was operating, against the guidelines, during high winds – 16 people were injured, including two young women who had their legs amputated. That’s why we need public protections of the kind the Telegraph wants to destroy.

The same ethos, with the same justification, pervades the Trump administration. The new head of the environmental protection agency, Scott Pruitt, is seeking to annul the rules protecting rivers from pollution, workers from exposure to pesticides, and everyone from climate breakdown. It’s not as if the agency was overzealous before: one of the reasons for the mass poisoning in Flint, Michigan, was its catastrophic failure to protect people from the contamination of drinking water by lead: a failure that now afflicts 18 million Americans.

‘The new head of the US environmental protection agency is seeking to annul the rules protecting rivers from pollution, workers from exposure to pesticides and everyone from climate breakdown.’ Photograph: Alamy

As well as trying to dismantle the government’s climate change programme, Trump is waging war on even the most obscure forms of protection. For instance, he intends to remove funds from the tiny US chemical safety board, which investigates lethal industrial incidents. Discovering what happened and why would impede freedom.

On neither side of the Atlantic are these efforts unopposed. Trump’s assault on public protections has already provoked dozens of lawsuits. The European council has told the UK government that if it wants to trade with the EU on favourable terms after Brexit, companies here cannot cut their costs by dumping them on the rest of society.

This drives the leading Brexiters berserk. As a result of the pollution paradox (the dirtiest corporations have to spend the most money on politics, so the political system comes to be owned by them), politicians like Boris Johnson and Michael Gove have an incentive to champion the freedom of irresponsible companies. But it also puts them in a bind. Their primary argument for deregulation is that it makes businesses more competitive. If it means those businesses can’t trade with the EU, the case falls apart.

They will try to light the bonfire anyway, as this is a question of power and culture as well as money. You don’t need to listen for long to the very rich to realise that many see themselves as the “independents” Friedrich Hayek celebrated in The Constitution of Liberty, or as John Galt, who led a millionaires’ strike against the government in Ayn Rand’s novel, Atlas Shrugged. Like Hayek, they regard freedom from democracy as an absolute right, regardless of the costs this may inflict on others, or even themselves.

When we confront a system of propaganda, our first task is to decode it. This begins by interrogating its sacred value. Whenever we hear the word freedom, we should ask ourselves, “Freedom for whom, at whose expense?”

Neoliberalism: the deep story that lies beneath Donald Trump’s triumph

George Monbiot in The Guardian

The events that led to Donald Trump’s election started in England in 1975. At a meeting a few months after Margaret Thatcher became leader of the Conservative party, one of her colleagues, or so the story goes, was explaining what he saw as the core beliefs of conservatism. She snapped open her handbag, pulled out a dog-eared book, and slammed it on the table. “This is what we believe,” she said. A political revolution that would sweep the world had begun.

The book was The Constitution of Liberty by Frederick Hayek. Its publication, in 1960, marked the transition from an honest, if extreme, philosophy to an outright racket. The philosophy was called neoliberalism. It saw competition as the defining characteristic of human relations. The market would discover a natural hierarchy of winners and losers, creating a more efficient system than could ever be devised through planning or by design. Anything that impeded this process, such as significant tax, regulation, trade union activity or state provision, was counter-productive. Unrestricted entrepreneurs would create the wealth that would trickle down to everyone.

This, at any rate, is how it was originally conceived. But by the time Hayek came to write The Constitution of Liberty, the network of lobbyists and thinkers he had founded was being lavishly funded by multimillionaires who saw the doctrine as a means of defending themselves against democracy. Not every aspect of the neoliberal programme advanced their interests. Hayek, it seems, set out to close the gap.

He begins the book by advancing the narrowest possible conception of liberty: an absence of coercion. He rejects such notions as political freedom, universal rights, human equality and the distribution of wealth, all of which, by restricting the behaviour of the wealthy and powerful, intrude on the absolute freedom from coercion he demands.

Democracy, by contrast, “is not an ultimate or absolute value”. In fact, liberty depends on preventing the majority from exercising choice over the direction that politics and society might take.

He justifies this position by creating a heroic narrative of extreme wealth. He conflates the economic elite, spending their money in new ways, with philosophical and scientific pioneers. Just as the political philosopher should be free to think the unthinkable, so the very rich should be free to do the undoable, without constraint by public interest or public opinion.

The ultra rich are “scouts”, “experimenting with new styles of living”, who blaze the trails that the rest of society will follow. The progress of society depends on the liberty of these “independents” to gain as much money as they want and spend it how they wish. All that is good and useful, therefore, arises from inequality. There should be no connection between merit and reward, no distinction made between earned and unearned income, and no limit to the rents they can charge.

Inherited wealth is more socially useful than earned wealth: “the idle rich”, who don’t have to work for their money, can devote themselves to influencing “fields of thought and opinion, of tastes and beliefs.” Even when they seem to be spending money on nothing but “aimless display”, they are in fact acting as society’s vanguard.

Hayek softened his opposition to monopolies and hardened his opposition to trade unions. He lambasted progressive taxation and attempts by the state to raise the general welfare of citizens. He insisted that there is “an overwhelming case against a free health service for all” and dismissed the conservation of natural resources.It should come as no surprise to those who follow such matters that he was awarded the Nobel prize for economics.

By the time Mrs Thatcher slammed his book on the table, a lively network of thinktanks, lobbyists and academics promoting Hayek’s doctrines had been established on both sides of the Atlantic, abundantly financed by some of the world’s richest people and businesses, including DuPont, General Electric, the Coors brewing company, Charles Koch, Richard Mellon Scaife, Lawrence Fertig, the William Volker Fund and the Earhart Foundation. Using psychology and linguistics to brilliant effect, the thinkers these people sponsored found the words and arguments required to turn Hayek’s anthem to the elite into a plausible political programme.

The ideologies Margaret Thatcher and Ronald Reagan espoused were just two facets of neoliberalism. Photograph: Bettmann/Bettmann Archive

Thatcherism and Reaganism were not ideologies in their own right: they were just two faces of neoliberalism. Their massive tax cuts for the rich, crushing of trade unions, reduction in public housing, deregulation, privatisation, outsourcing and competition in public services were all proposed by Hayek and his disciples. But the real triumph of this network was not its capture of the right, but its colonisation of parties that once stood for everything Hayek detested.

Bill Clinton and Tony Blair did not possess a narrative of their own. Rather than develop a new political story, they thought it was sufficient to triangulate. In other words, they extracted a few elements of what their parties had once believed, mixed them with elements of what their opponents believed, and developed from this unlikely combination a “third way”.

It was inevitable that the blazing, insurrectionary confidence of neoliberalism would exert a stronger gravitational pull than the dying star of social democracy. Hayek’s triumph could be witnessed everywhere from Blair’s expansion of the private finance initiative to Clinton’s repeal of the Glass-Steagal Act, which had regulated the financial sector. For all his grace and touch, Barack Obama, who didn’t possess a narrative either (except “hope”), was slowly reeled in by those who owned the means of persuasion.

As I warned in April, the result is first disempowerment then disenfranchisement. If the dominant ideology stops governments from changing social outcomes, they can no longer respond to the needs of the electorate. Politics becomes irrelevant to people’s lives; debate is reduced to the jabber of a remote elite. The disenfranchised turn instead to a virulent anti-politics in which facts and arguments are replaced by slogans, symbols and sensation. The man who sank Hillary Clinton’s bid for the presidency was not Donald Trump. It was her husband.

The paradoxical result is that the backlash against neoliberalism’s crushing of political choice has elevated just the kind of man that Hayek worshipped. Trump, who has no coherent politics, is not a classic neoliberal. But he is the perfect representation of Hayek’s “independent”; the beneficiary of inherited wealth, unconstrained by common morality, whose gross predilections strike a new path that others may follow. The neoliberal thinktankers are now swarming round this hollow man, this empty vessel waiting to be filled by those who know what they want. The likely result is the demolition of our remaining decencies, beginning with the agreement to limit global warming.

Those who tell the stories run the world. Politics has failed through a lack of competing narratives. The key task now is to tell a new story of what it is to be a human in the 21st century. It must be as appealing to some who have voted for Trump and Ukip as it is to the supporters of Clinton, Bernie Sanders or Jeremy Corbyn.

A few of us have been working on this, and can discern what may be the beginning of a story. It’s too early to say much yet, but at its core is the recognition that – as modern psychology and neuroscience make abundantly clear – human beings, by comparison with any other animals, are both remarkably social and remarkably unselfish. The atomisation and self-interested behaviour neoliberalism promotes run counter to much of what comprises human nature.

Hayek told us who we are, and he was wrong. Our first step is to reclaim our humanity.