Subramanian Swamy: A cat among the pigeons

Lakshmi Iyer in The Times of India

Modi's Arab steed? Or Congress' Trojan horse? Subramanian Swamy's entry into the Rajya Sabha has Lutyens' Delhi aflutter with theories.

For someone who has straddled the Indian political scene for over four decades, Dr Subramanian Swamy has always been an important figure in Lutyens' Delhi. A mover and a shaker, he has dominated events and determined their outcome through dogged courtroom battles. Yet his nomination to the Rajya Sabha last month by the Modi Government is seen as something that will alter power equations, not just across the Parliament but within the BJP itself. Swamy's entry into a Congress-dominated Rajya Sabha is being seen as a natural step forward after his resounding success in the National Herald litigation in December 2015, when he managed to force both Sonia and Rahul Gandhi to secure bail in his case against the Congress-controlled newspaper in a Delhi court.

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BJP managers point out that Swamy had to be in the RS just to rile the Gandhis and disturb Congress benches to push government business. In fact opposition leader, Ghulam Nabi Azad, described him as a "new gift of the BJP to us". However, with his new-found status, the one-time Harvard professor is the most sought-after VVIP in political circles. As ex-Delhi BJP MLA, Vijay Jolly of the Delhi Study Group, who is organising a public felicitation for Swamy on May16 at the Constitution Club, offers, "Envoys from 25 countries — such as China, US, Taiwan, Vietnam — have all confirmed participation just to hear Swamy speak. Swamy's appointment diary is apparently full for next two months."

The BJP leader's entry into the Parliament is making waves, not just outside Raisina Hills but even among MPs. "Now everyone is taking a keen interest in the Rajya Sabha proceedings, more so than the Lok Sabha," said a first-term BJP MP from Rajasthan. Online viewership of RSTV reportedly went up by 900 per cent when Swamy spoke on the Agusta (aka Choppergate) scam. Even within the Parliament, there was tremendous curiosity to hear him firsthand, with members rushing back to the House from the Central Hall.

Yet within the BJP, Swamy is held in awe and the party is exploring ways to cope with him. For someone who has wielded tremendous power before — he has been a Union Minister and run a Government (Chandrashekhar, 1990-91), been part of one (Narasimha Rao, 1991-96) and remorselessly destroyed another just after a year in office (Vajpayee Government, 1998-1999), the party is walking on eggshells when it comes to Swamy.

For some BJP/Sangh leaders, Swamy has been made an MP by the Modi Government only to break the myth that this Government has done nothing about the Gandhis. "It wants to fight the image. There was a need to send a message to the cadres," said a Sangh leader. Officially, the Sangh denied it had any role to play in the RS berth for Swamy. "It is better you ask the Government," said RSS spokesman Manmohan Vaidya.

Off the record, however, Sangh sources acknowledged that Swamy had been close to late VHP leader Ashok Singhal. "He has vigourously pursued Hindu causes such as Ram Setu, Ayodhya, and the Sangh top brass will always be proud of him," said Rajiv Tuli of Delhi RSS.

Significantly, Union Transport Minister Nitin Gadkari — someone close to RSS chief Mohan Bhagwat — hosted a dinner in honour of Swamy soon after he became MP. It is quite possible that Swamy could be used by the Government to build legal support for the Ram temple at Ayodhya at a later juncture.

Bringing Swamy into the House has brought a lot of pep and vigour into the rank and file of the BJP. It has also boosted the image of the PM. It was felt that Modi was not keen to take on the Gandhis directly, but now, he is being seen as a man of action.

A signal to Jaitley

To a section within the BJP, Swamy's RS entry has come as a surprise. Many believe that the new MP could be a signal from the RSS/party leadership to undermine the Leader of the House, Arun Jaitley. BJP sources admit Swamy's problem with Jaitley runs deep. Old-timers recall that he had targeted the FM during NDA-I too — between 1998 and 2004. Swamy's latest ruse against the Finance Minister is denying him a New Delhi Lok Sabha seat in 2014 — that too after consulting Modi about it. Jaitley ensured that the seat went to his friend Meenakshi Lekhi instead. BJP sources say the PM won't compromise with Jaitley's authority. "There is no possibility of letting down Jaitley, though it will require management skills to maintain an equivalence between Jaitley and Swamy," said a BJP leader.

RSS sources admit that in the past two years Swamy was in a limbo. "It is better to have Swamy on your side than against you," said a RSS sympathiser. On the face of it, Congress leaders dismiss the idea that by bringing in Swamy, the PM has played a master stroke — he got a Gandhi family-baiter into the House — to put a lot of pressure on the opposition. It was Swamy's petition in the National Herald case that has made the Congress chief Sonia Gandhi and Rahul appear in a trial court in December 2015 to secure bail.

"Frankly, we are not worried about Swamy. It does not matter to us. In fact, his presence in the treasury benches should worry the BJP more. His becoming MP has more to do with Leader of the House, Arun Jaitley, than the Congress — it is purely an internal matter of the BJP," said senior Congress MP Satyavrat Chaturvedi.

The Digvijay of BJP

He went on to describe Swamy as the "Digvijay Singh of the BJP — a master at self-goals". Why should we worry about him — whose utterances were expunged for three consecutive days?" He goes on to add, "Swamy was expelled from the Rajya Sabha for misconduct. So why should the Congress be scared of Swamy? It is odd that a Congress leader should cite his record during the Emergency. He was expelled from the RS in 1976 during the Emergency for fleeing the country on an impounded passport. A Jan Sangh member then, he's remembered for making an appearance in the Parliament for a day in August 1975 and subsequently slipping out of the country to launch a campaign against Emergency abroad."

Congress sources admit Swamy's entry can't be taken lightly. "With Swamy on the other side, we will need both Kapil Sibal and P Chidambaram to face up to him," said a Congress MP, pointing out how Swamy defeated Abhishek Singhvi's arguments in the Agusta debate. In the upcoming months, if political parties are to pick legal luminaries to fight their political battle, Rajya Sabha could soon resemble proceedings in the Supreme Court.

The wars of Pakistan over India

The Tragedy of 1971 - explained in Urdu by Hamid Bhashani

The story behind the Kargil war - explained in Urdu by Hamid Bhashani

The 1965 War - explained in Urdu by Hamid Bhashani

The 1948 War - explained in Urdu by Hamid Bhashani

Corrupt elites will fight hard to stop the dismantling of the looting machines from which they draw their vast wealth

States that get all their revenues from selling their oil, gas and minerals could easily turn into kleptocracies where the majority stay poor

Patrick Cockburn in The Independent

A shooper at the Olaya mall in the Saudi capital of Riyadh. Ordinary citizens may be hit by efforts to tackle global corruption and patronageGetty


Can corruption be controlled by reform or is it so much the essential fuel sustaining political elites that it will only be ended – if it ends at all – by revolutionary change?

The answer varies according to which countries one is talking about, but in many - particularly those relying on the sale of natural resources like oil or minerals - it is surely too late to expect any incremental change for the better. Anti-corruption drives are a show to impress the outside world or to target political rivals.

The anti-corruption summit in London this week may improve transparency and disclosure, but it can scarcely be very effective against politically well-connected racketeers, busily transmuting political power into great personal wealth.

This is peculiarly easy to do in those countries in the Middle East and Africa which suffer from what economists call “the resource curse”, where states draw their revenues directly from foreign buyers of their natural resources. The process is described in compelling detail by Tom Burgis in his book, The Looting Machine: Warlords, Tycoons, Smugglers and the Systematic Theft of Africa’s Wealth. He quotes the World Bank as saying that 68 per cent of people in Nigeria and 43 per cent in Angola, respectively the first and second largest oil and gas producers in Africa, live in extreme poverty, or on less than $1.25 a day. The politically powerful live parasitically off the state’s revenues and are not accountable to anybody.

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Burgis explains the devastating outcome of a government acquiring such great wealth without doing more than license foreign companies to pump oil or excavate minerals. This “creates a pot of money at the disposal of those who control the state. At extreme levels the contract between rulers and the ruled breaks down because the ruling class does not need to tax the people – so it has no need for their consent.”

He writes primarily about Africa south of the Sahara, but his remarks apply equally to the oil states of the Middle East. He rightly concludes that “the resource industry is hardwired for corruption. Kleptocracy, or government by theft, thrives. Once in power, there is little incentive to depart.” Autocracy flourishes, often same ruler staying for decades.

Most, but not all, of this is true of the Middle East oil producers. A difference is that most of these have patronage and client systems through which oil wealth funds millions of jobs. This goes a certain way in distributing oil revenues among the general population, though the benefits are unfairly skewed towards political parties or dominant sectarian and ethnic groups.

In Iraq there are seven million state employees and pensioners out of a population of 33 million who are paid $4bn a month or a big chunk of total oil income. Often these employees don’t do much or, on occasion, anything at all, but it is an exaggeration to imagine that Iraq’s oil money is all syphoned off by the ruling elite.

I remember in one poor Shia province in south Iraq talking to local officials who said that they had just persuaded the central government to pay for another 50,000 jobs, though they admitted that they had no idea what these new employees would be doing.

Reformers frequently demand that patronage be cut back in the interests of efficiency, but a more likely outcome of such a change is that a smaller proportion of the population would benefit from the state income.

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This could be the result of Deputy Crown Prince Mohammed bin Salman’s radical plans to transform the way Saudi Arabia is run and end its reliance on oil by 2030. He may well find that the way Saudi society works has long gelled and face strong resistance to changing a system in which ordinary Saudis feel entitled to some sort of job and salary.

The “resource curse” is not readily reversible, because it eliminates other forms of economic activity. The price of everything produced in an oil state is too expensive to compete with the same goods made elsewhere so oil becomes the only export. Migrants pour in as local citizens avoid manual labour or employment with poor pay and conditions.

A further consequence of the curse is that the rulers of resource rich states – like many an individual living on an unearned income – get an excessive and unrealistic idea of their own abilities. Saddam Hussein was the worst example of such megalomania, starting two disastrous wars against Iran and Kuwait. But the Shah of Iran was not far behind the Iraqi leader in grandiose ideas, blithely ordering nuclear power stations and Concorde supersonic passenger aircraft.

Muammur Gaddafi insisted that Libyans study the puerile nostrums of the Green Book, and those failing that part of the public examinations about the book, were failed generally and had to re-take all their exams again.

Can “the looting machine” in the Middle East, Africa and beyond be dismantled or made less predatory?

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Its gargantuan size and centrality to the interest of ruling classes probably makes its elimination impossible, though competition, transparency and more effective bureaucratic procedures in the award of contracts might have some effect. The biggest impulse to resistance locally to official corruption has come because the fall in the price of oil and other commodities since 2014 means that the revenue cake has become too small to satisfy all the previous beneficiaries.

The mechanics and dire consequences of this system are easily explained though often masked by neo-liberal rhetoric about free competition.

In authoritarian states without accountability or a fair legal system, this approach becomes a license to loot. Corruption cannot be tamed because it is at the very heart of the system.

Donald Trump supporters are not the bigots the left likes to demonise

John Harris in The Guardian

Last Tuesday, at about 3pm, I parked my rental car outside a polling station in the suburbs of Indianapolis, and began to talk to the droves of people going in and out. There was only one subject I really wanted to hear about:Donald Trump, and his jaw-dropping progress to being the presumptive Republican nominee.

As he said himself, a win in the state of Indiana would seal the deal, and so it proved: he got 53% of the vote, which triggered the exit of his two supposed rivals. Meanwhile, the global liberal left seemed to be once again working itself into a lather, which was easily translatable: how awful that a man routinely described using all the boo-words progressives can muster – misogynist, racist, fascist, xenophobe, or “xenophobic fascist”, as George Clooney understatedly put it – could now be a resident of the political mainstream, and a serious contender for president.

Though calling him a fascist surely demeans the victims of the real thing, Trump has some extremely grim views, and the idea of him in the White House has an obviously terrifying quality. But for those who loathe him, a problem comes when the nastier elements of his rhetoric are conflated with the supposed instincts of millions of his supporters, and familiar stereotypes come into play. “Not all Donald Trump supporters are racists, but most racists are Donald Trump supporters,” says the liberal online outlet Salon. “The unusual geographic pattern of Trumpism … corresponds to the geography of white racial resentment in the United States,” offers a contributor to the political website Vox. “They vote for him because he is a racist bigot,” reckoned one eloquent tweeter I briefly corresponded with.

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Caricatures of rednecks and white trash are obviously in the foreground here. Worse still, such judgments are often arrived at through polling data, guesswork, and a large measure of metropolitan prejudice: in keeping with one of the most baffling failings of political journalism across the globe, too few people think of speaking to the voters themselves.

So to Indiana, where, with my Guardian colleague John Domokos, I spent the best part of five days following the Trump campaign. No one mentioned his assuredly unpleasant ideas about excluding Muslims from the US, nor his absurd proposal to build a wall between America and Mexico, at the latter country’s expense. Indeed, when I saw Trump speak at a rally in the Indiana town of Evansville, he made no reference to what he has said about Muslims, and dealt with the fabled wall in a matter of seconds.

Instead, he talked at length about two of his pet themes. First, he banged on about the free trade deals that he says have blitzed US industry as companies have moved abroad, luxuriated in newly low labour costs, and imported their wares back into the country. Second, he fed that specific story into a general sense of national decline.

‘Clinton’s enemies malign her as someone who enthusiastically supported the trade deal to end all trade deals: Nafta, in 1994, which the Carrier workers put at the centre of their predicament.’ Photograph: Mark Wilson/Getty

All of this is very real. From the dreadful state of the roads to the palpable sense of communities reeling from the military adventures that began in 2001, time spent in the US quickly reveals a country that collectively feels it has taken no end of wrong turns, and must somehow sort itself out. It is one of the more overlooked stories of the 2016 election that Trump’s views about this malaise intersect with the insurgent campaign still being waged by that great left hope, Bernie Sanders. There are, in other words, two anti-establishment figures doing their thing on either side of the political divide, with great success.

Trump calls DC Republicans to heel



But in the case of Trump, his positioning fuses with his hyperactive, barnstorming TV persona, and creates something with particularly populist appeal. The presentation is pure political vaudeville, used in the service of anti-politics: rambling (and often very funny) oratory, cartoon political incorrectness, self-obsession so extreme that it comes out looking endearingly self-parodic. But at the core are oomphy words about something built into his audiences’ daily reality: stores full of goods made overseas, and jobs that feel increasingly under threat.

His proposed solution, his detractors say, is probably beyond the reach of a president, and in the short term would presumably hit his supporters’ wallets like a hammer, but it’s simple enough: if any company dares move overseas, he’ll whack their goods with such high tariffs that they’ll soon come running back.

At the polling station, all of the above was reflected in the reasons people gave for supporting him. Just to make this clear: obviously, there are voters with bigoted opinions who think he’s their man. But equally, almost none of the Trumpites I met seemed to be the gun-toting zealots of liberal demonology: they explained voting for him in very matter-of-fact terms, usually with explicit criticism of the current political class. “Jobs, outsourcing, bringing jobs back to our country,” offered one of his supporters. “We’re getting aluminium from China – we don’t need aluminium from China. Hell, we make it right here,” said another. There was also much more nuance than you might expect. “I hate the way he talks about women, but I love the way he handles things,” one woman told me.

Indiana has one particular case study Trump talks about. In Indianapolis, a company called Carrier recently announced the imminent closure of an air-conditioning factory, with the loss of 1,400 jobs. Its operations will be shifted to Mexico. In Indianapolis, average wages are over $20 an hour, but once the move over the border is complete, pay will be more like $3. Talking to workers, it seemed that they were split down the middle, with some – like the local branch of their union, the United Steelworkers – supporting Sanders, while others favoured Trump.

Again, the latter option was often framed in terms of difficult choices, and some degree of hesitancy. A Carrier employee called Brad Stepp described his fear of the future, and why Trump represents “the lesser of three evils”. He was well aware of the absurdities of a high-living billionaire claiming to have the back of American workers, not least in the context of Trump’s recent(ish) claim that people in the US are paid too much. But he had made his choice. “We need somebody that’s tough,” he said. “If he can’t stop Carrier going, maybe he can stop other companies doing the same thing.” In the midst of all this, one character sits in a very uneasy position. Unsettled by their popularity, Hillary Clinton has been trying to echo some of Trump’s and Sanders’ pronouncements on trade and jobs. “I won’t support any agreement unless it helps create good jobs and higher wages for American workers,” she says, offering to be the president for “the struggling, the striving and the successful”. Her enemies, by contrast, malign her as someone who enthusiastically supported the trade deal to end all trade deals: the North American Free Trade Agreement of 1994, which the Carrier workers put at the centre of their predicament. In fact, politics being politics, the details of her record matter less than broad-brush appearances. And here, the story for her adversaries is a cinch. The establishment has failed; she is a card-carrying member of that establishment; ergo, she has failed too.

Herein lies a vulnerability that should chill the liberal left to the bone. Five days after I got back from Indiana, polls suggested that the presumed contest between Clinton and Trump will be much closer than some people imagine. For those who yell at him and his supporters from the sidelines, that news ought to give pause for thought: before it’s too late, maybe it’s time to stop hysterically moralising and instead try to understand not just how mainstream US politics has so awfully failed, but how it might somehow be rescued.

Receptionist 'sent home from work without pay for refusing to wear high heels'

Siobhan Fenton in The Independent

A woman has been sent home from work for refusing to wear high heels, it has been reported.

Temp worker Nicola Thorp says she arrived for her first day in a new role at the London offices of accountancy firm PwC wearing flat shoes. She says she was told to change into high heels with a height of 2 to 4 inches.

Ms Thorp claims she was laughed at when she challenged the policy and sent home without pay when she refused to wear heels.

Ms Thorp told The BBC that she was shocked when she arrived at work for her first day and was told about the policy: “I said ‘If you can give me a reason as to why wearing flats would impair me to do my job today, then fair enough’, but they couldn’t. I was expected to do a nine-hour shift on my feet escorting clients to meeting rooms. I said ‘I just won’t be able to do that in heels’.”

She says she asked whether men were also expected to wear high heels and was laughed at for raising the objection. She said: “I was a bit scared about speaking up about it in case there was backlash. But I realised I needed to put a voice to this as it is a much bigger issue. Aside from the debilitating factor, it’s a sexism issue. I think companies shouldn’t be forcing that on their female employees.”

Ms Thorp has launched a petition calling for the law to be changed to stop employers from being able to insist that a woman wear high heels as part of their work. It has amassed more than 20,000 signatures of support.

PwC have stated that the dress code is not their policy but that of a third party recruitment firm Portico which they use to employ staff. A spokesperson told The BBC: “PwC outsources its front of house and reception services to a third party supplier. We first became aware of this matter on 10 May, some five months after the issue arose. The dress code is not a PwC policy.”

A Portico spokesperson said: “In line with industry standard practice, we have personal appearance guidelines across many of our corporate locations. These policies ensure staff are dressed consistently and include recommendations for appropriate style of footwear for the role. We have taken on board the comments regarding footwear and will be reviewing our guidelines in consultation with our clients and team members.”

Emma Watson campaigned on one social issue - she's not a hypocrite if she has offshore accounts

Because she is outspoken on one social issue, we expect Watson to be a model activist in every other political arena, a whiter-than-white every woman who stands up for us us all. That’s a standard that’s impossible for anyone to live up to.

Hannah Fearn in The Independent





Emma Watson, eh? Who would have thought it? All that moralising on the world stage, standing up for the rights of women, speaking out about the devastating economic and social effects of gender inequality. And it turns out that she’s been part of the global elite all along, a one percenter happily squirrelling away her millions in an offshore tax haven in the British Virgin Isles.

Of course, her people explain that the arrangements are purely to protect her privacy. But blow me down with a feather. What will the supporters of the HeForShe campaign make of it?

The answer to that should be: absolutely nothing. The fact that a woman who has a public position on one matter – gender equality– bears no relation to the fact that she has later found herself entangled in an another altogether different political question of tax evasion. But that hasn’t stopped her critics.

When the news that Watson, reportedly worth $70m, had used a company registered offshore to purchase a home, out came the angry rants. “I thought you're the most honest actress in the world! Wrong,” posted one fan – perhaps a former fan – on Twitter. “After being named in the Panama Paper scandal do you think you should be demanding a statue of anything?” another oddly added, referring to her campaigning for Sadiq Khan, the new Mayor of London, to erect a statue of a figure from the Suffragettes in Parliament Square.

Then came the snarky puns: Harry Potter and the Deathly Havens; Harry Potter and the Prisoner of Taxaban; Harry Potter and the Half-blood Principal Investor. There’s a lot more where that came from.

The aforementioned spokesperson for Watson claimed that the actor had not used an offshore haven to avoid tax or any of her other financial responsibilities as a British citizen, but instead to protect her privacy, given her celebrity status. Reassuring for her disappointed fans perhaps, but it makes no material difference whatsoever.

Even if the young film star had deliberately hidden her assets away in an attempt to legally avoid tax, she is no hypocrite and she does not deserve to be treated like one. You may morally object to tax havens, but there’s no reason to be any more angered by Watson’s financial affairs than those of the Cameron family, Sarah Ferguson, Michel Platini, Simon Cowell or Heather Mills.

What is driving the disproportionate reaction to Watson’s British Virgin Islands connection is a bizarre sense that our public figures represent whatever we think they ought to, rather than what they want to, and what they actually do. Because she is outspoken on one social issue, we expect Watson to be a model activist in every other political arena, a whiter-than-white every woman who stands up for us us all. That’s a standard that’s impossible for anyone to live up to.

It’s a sentiment we see echoed when gay and ethnic minority figures, or even bohemians such as the artist Tracy Emin, express their support for the Conservatives. Surely they should be on the political left, where they ‘ought’ to belong?

The Black Lives Matter movement in the US has prompted similarly pointless soul-searching. Why have rap stars such as Drake and Jay Z – leading black figures in US popular culture – remained so quiet on the matter in their music? Writing in The Atlantic, the journalist Jeff Baird expressed concern that figures such as these were selling music that didn’t reflect the often difficult experience of being black in America and instead concerned itself with feelgood lyrics (“as if their success should be regarded as proof that the American Dream is in fact alive and well”) and great pop tunes instead. Well, why shouldn’t they? It’s their stock-in-trade.

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What we struggle to cope with is the idea of pop stars, actors or other national figures behaving in ways other than what we might expect from their PR-designed public persona. It’s a position that doesn’t stand up to scrutiny. Each and every one of us has friends or relatives who are passionate about one social issue but ambivalent about another. The environmental activist who is aiming to produce zero waste may have no view whatsoever on the closure of domestic violence services for women; the Hillsborough campaigner who spent 27 years fighting for justice for the 96 may have never thought twice about cuts to disability benefit for those unable to work. So what? The latter does not take away from the significance of their efforts on the former.

Emma Watson is a wealthy young actor who has used her not inconsiderable global influence to start an important conversation about the position of women in the world. For that, she is rightly celebrated. She is not, and has never been, a tax justice campaigner.
I don’t like the idea of any wealthy individual finding ways around paying their due – and there is no suggestion that this is what Watson has done. But the idea that her efforts on behalf of all women have been undermined by the furore sparked by the latest Panama Papers revelations is dismissive and naïve in the extreme.

Corruption can no longer be dismissed as a developing world problem

Aditya Chakrabortty in The Guardian

A London summit must recognise, as the Panama Papers show, that these crimes are facilitated by the west

 

Illustration by Matt Kenyon.


By Thursday morning all the A-listers will have arrived. From Washington will fly in a succession of jets, bearing US secretary of state John Kerry as well as the bosses of the IMF and World Bank. Fifa and Uefa will send over their top bureaucrats. Captains of business will trail retinues of lobbyists.

All will join David Cameron and leaders from around 40 nations at an opulent London townhouse overlooking St James’s Park. Gathered there, in the slow-beating heart of Downton-ian Britain, they will launch into an almighty battle – over the meaning of a single word.

Not just any old word, mind you. It ranks among the most important terms for describing our broken-backed global capitalism. Indeed, it forms the very title of the day-long summit: corruption.

Explaining why he’s called the world’s first assembly on corruption, Cameron has said: “It destroys jobs … traps the poorest in desperate poverty, and undermines our security by pushing people towards extremist groups.” Absolutely right. What’s wrong is his definition of the term.

For Cameron, corruption equals bribery. It means greasing the palm of a bored official just to get through customs, tipping a hundred to a thuggish traffic cop so you can drive on. Or, at the luxury end of the market, a despot such as Nigeria’s General Sani Abacha, stealing billions from his home country and hiding the haul in foreign banks.

In other words, it’s something largely done by people in poor countries. As sardonic critics of this argument say, “Corruption has a black face.” That’s why the prime minister believes Thursday should be mainly about cracking down on states that take aid even while being blighted with bent officials, and tackling graft in sport.

And it is the argument of a hypocrite. Hypocrisy is the fervent agreement that bad things do happen – but Other People do them, never you or your country. On this reading, thievery is corruption. But receiving the same black money, laundering it and directing it back out to a tame tax haven or two – well, that’s just competition, isn’t it?

Time was when Britain, Europe and the US could get away with making this argument. The wealthiest countries in the world could with one hand wag a stern finger at the poorest nations, while with the other hand collecting their loot, and pushing it through their financial centres.

They could point to the surveys circulated by Transparency International in which perceptions of national corruption as reported by business leaders and “country experts” were totted up. Those publications proved, year after year, that the poorer the country, the more failed the state, the more corrupt the society. They also stated that the world’s “cleanest” countries included Switzerland, Singapore, the UK and the US.

David Cameron under pressure to end tax haven secrecy



All those breezy, boomtime justifications became exponentially harder to make after the 2008 crash. The era of austerity has left even rich governments scrabbling for tax revenues to fund their hospitals and schools. More importantly, it has prompted cash-strapped voters – from a Trump supporter in Indiana to a Corbynista in Kentish Town – to ask exactly who has been making how much money at their expense.

That brings us back to this week’s summit – because it’s here that developing nations such as Nigeria will join campaigning groups to make the argument that modern corruption now has a white face. They will argue that the onus is on Britain and other rich countries to crack down on the tax havens in their own backyards.
And they are right. Corruption of the sort that we normally discuss should be stamped out. It makes the lives of billions of the world’s poorest people harder and more insecure.

But it is peanuts compared to the much bigger sums that are raked in by the lawyers, accountants and other silky advisers who base themselves in the City of London and use Britain’s network of crown dependencies and overseas territories in Jersey, Guernsey, the Caymans and the British Virgin Islands.

Until the UK stops encouraging, advising and facilitating guilty men and women looking to stow their shady cash offshore, corruption will continue to flourish.

Modern corruption is a suit in a Panamanian office, who takes that general’s billions and sends it on to a private bank account, no impertinent questions asked along the way. It is the Mayfair estate agent who sells that multimillion-pound townhouse to an oligarch. It is that accountancy firm in the City that fills out the paperwork structuring the rich man’s affairs so that the money goes through one of their far-flung branch offices to wind up in a trust in the tax-free zones of the Caymans or the British Virgin Islands.

As yesterday’s letter from 350 top economists points out, there is no economic justification for these tax havens. They do not serve primarily to keep taxes in other countries down, but to allow very rich people to duck out of their obligations to the societies they live in. They shelter dirty cash from dictators, and siphon money out of developed countries. 

Like Gordon Brown before him, Cameron claims that Britain’s offshore havens are autonomous. They do not need to accept London’s tax laws – indeed, it is unclear whether they will turn up on Thursday. Yet the havens depend on London.

Take the Caymans, which, as Nicholas Shaxson notes in his book Treasure Islands, are effectively run by a governor appointed by the Queen, on the advice of Whitehall. The governor is responsible for “defence, internal security and foreign relations; he appoints the police commissioner, the complaints commissioner, auditor general, the attorney general, the judiciary and a number of other senior public officials. The final appeal court is the Privy Council in London.” And the national anthem is God Save the Queen.

Last week I met a tax lawyer in London who mused on how little Britain actually benefited from its spider’s web of tax havens. “A few people in the City of London make huge fees – I’d love to see how much that money benefits the rest of the country.”

But weren’t we powerless to stop Jersey and the rest? The lawyer went through the precedents. Britain, he pointed out, had repeatedly imposed its law on its overseas governments. In 2000, London forced the Caribbean territories to decriminalise homosexual acts by Order in Council. He thought the same thing could be done to force the offshore havens publicly to disclose who were the ultimate “beneficial” owners of the trust funds.
How long would that take? “Oh, two sides of A4. It could be done by the next morning. All it takes is the will.”