It is more truly global than the “global war on terrorism”, more quixotic than the global war on the drug trade, and vastly more costly than either of these.
We’re talking about the global struggle between governments and multinational corporate tax dodgers.
Would you call it a war? There are no bullets, but the conflict bears other hallmarks of war. It involves a threat to national sovereignty. And it is fought at huge human cost – in lives impoverished or cut short by lack of access to food, health services and infrastructure that governments cannot provide for their citizenry because they have been cheated of trillions of dollars.
Trillions? With a “T”, as in millions of millions? Perhaps you think I exaggerate.
Then hear this, from Edward Kleinbard, a Professor of Law at the University of Southern California (USC), and former Chief of Staff of the US Congress’s Joint Committee on Taxation.
Because of an anomaly in US tax law, which requires that companies report their holdings in offshore tax havens, says Kleinbard, “we can say with some precision that US firms have about $2 trillion today in offshore, unrepatriated, low-tax earnings.
“Now, not all that $2 trillion is cash; some is invested in real subsidiaries doing real things, but about 40 per cent is cash,” Kleinbard told The Global Mail.
To give some idea of the magnitude of this corporate stash of money, consider that the gross domestic product of Australia is only about $1.5 trillion.
