Does it matter that Mitt Romney, the presumptive nominee of the Republican Party for president of the United States, is a huge fan of offshore tax havens?
It should to Americans who take seriously the question of whether this country has the resources to pay for Social Security, Medicare, Medicaid, implementation of the Affordable Care Act and all the other programs and initiatives that Romney and House Budget Committee Paul Ryan, R-Wisconsin, say we can no longer afford.
The truth, of course, is that the United States produces more than enough taxable wealth to pay for every program that Romney and Ryan propose to “reform,” mangle, dismantle or eliminate.
Indeed, a remarkable new study produced for the global Tax Justice Network reveals that at least $21 trillion—yes, that’s “trillion” with a “t”—has been shielded from appropriate taxation in the secret tax havens favored by the super-rich of the United States and other countries around the world.
To put that figure in perspective, $21 trillion is the equivalent of the combined GDPs the United States and Japan.
James Henry, the former chief economist for McKinsey & Company (a top international business consulting firm), produced the report for the Tax Justice Network. Employing data from the Bank of International Settlements, International Monetary Fund, World Bank and governments around the world, Henry came up with what he describes as the “conservative” figure of $21 trillion as a baseline measure of the financial wealth deposited in offshore bank and investment accounts.
Henry says that private wealth socked away in offshore tax havens by billionaires and millionaires who want to avoid paying their fair share at home represents “a huge black hole in the world economy.”
It also represents an opening, should world leaders choose to address the issue, for governments to claw back tax revenues in a time of global economic distress.