Two Tales of Scandals in Panama With Same Cataclysmic Effects.

Two Tales of Scandals in Panama

With Same Cataclysmic Effects.

Yesterday in Panama:

About one-hundred-and-twenty-seven years ago, a scandal of global magnitude rocked Panama, a Central American country, a link between North and South American continents-more important, a country that will provide an extra-ordinary connection between the two worlds-through a canal-for West to meet East.

A French firm, Panama Canal Company owned by Ferdinand de Lesseps, the man who constructed the Suez Canal in Egypt in 1869, the artificial-waterway that

connect Mediterranean Sea to the Indian Ocean was hired again to construct  Panama Canal.

Panama Canal is a “48-mile or 77 kilometer ship canal” on a  narrow strip of land-the Isthmus of Panama-between Caribbean Sea and Pacific Ocean; a project with both economic and political importance, then and now.

Panama Canal Company, through a public offer raised 1.8 billion French Francs in nine stocks-shares and bonds; received 1.2 billion French Franc, invested 960 million French franc on Panama Canal’s ten-year-project with the estimated date of completion in 1890.

Unfortunately, the project went awful, the company failed to perform and to deliver; nine years into the project, Panama Canal Company went bankrupt.

Because of bribes that many of French government officials received running into millions of franc, government hid the company’s financial health from its 800,000 investors, including 15,000 single women.

At the time company’s health status became a public knowledge, it was too late; several French citizens had lost their life earned investments without hope of recovery.

What a shame? Every reasonable mind asked, as secrecy and corruption-a major vehicle of ruination served as a platform to execute Panama Canal project.

What a financial disaster to thousands of French citizens? What a setback and a gloomy future for a project with international importance? What a bad precedent-the project set for future international trades and cooperation, as secrecy and corruption are driving agents leading to unwholesome and unethical business conducts?

Regardless of the “Bribery Trial,” which indicted six ministers, including George Benjamin Clemenceau a two-term French prime minister, 104 legislators,  jail terms handed down to de Lesseps and his son, Charles,  Bathaut, and Gustave Eiffel (the French Engineer behind the 324 meters or {1063 ft} ) Eiffel Tower in Paris-

Panama Scandal set a bad tone for the future international and cross border crimes, it opened the floodgate of corrupt practices future international businesses and services would witness with little or no sanction, as it happened recently with another scandal from Panama-the Panama Papers.

Today in Panama:

Eleven million documents on 214,000 offshore companies registered by Mossack Fonseca, a Panamanian law firm has continued to generate more ripples around the globe.

Offshores are secret firms or establishments-shell companies-created by individuals to hide their wealth from public scrutiny, more important, to avoid paying taxes and other charges in lands or areas where these monies are made.

In practical sense, these secret account holders are unknown to the public, as they use fronts within or outside geographical enclaves with bogus names and information to funnel monies to tax havens in distance lands.

Ironically, companies like Mossack Fonseca hardly know the real owners of offshore accounts they help create;  according to a report, Mossack Fonseca  know only 204 owners of 14,086 companies it established in Seychelles, a major tax haven in Indian Ocean archipelago.

Capitalism-The Bane of Secrecy, Corruption and Poverty:

Capitalism has remained humankind worst enemy-just as the richest 1 percent of world population controls 50 percent of world’s wealth and resources.

At least, the 12 current or former world leaders and 128 politicians referenced by Panama papers are from capitalist nations and, or friends of capitalist society.

No doubt, more individuals will still be unearthed, and will no be less from capitalist society in western hemisphere.

For centuries, capitalism ruled over humankind; prior to reformation in Europe, it could be said, the feudal system was nothing, but extreme version of capitalism;   an economic and social system of holding land in exchange for service or labor.

Even as reformation reshaped Europe, Europe did not jettison capitalism; rather through discovery and industrial revolution, reformation strengthened and breathed life into capitalism to make it a global economic framework, upon which individual wealth is created at the expense of the masses.

From Indian sub-continent through Africa to Americas, the new world, European lords made fortune, to this day the fortune continues in various forms, shapes and designs.

Today, there is wealth inequality and extreme poverty; very unfortunate and sad though, we live in a world where just 62 “of world richest people own as much as the poorest half of humanity combined,” said, Oxfam, with a combine networth of $1.76 trillion.

Mark Goldring, the Oxfam chief executive, expressed general sentiment, when he said: “it is simply unacceptable that poorest half of world population owns no more than a small group of the global super-rich-so few, you could fit them all on a single coach.”

No thanks to the behemoth-capitalism- the 21^st century economic ideology that promotes, protects, and encourages private ownership of means of production.

Yes, no thanks to capitalism-the modern day octopus-the multi-strategic “predator” that uses different lethargic weapons that are venomous to defend, protect, and promote itself.

One of such deadly weapons of capitalism is secrecy, though it promotes-leissez faire-the open market policy premised on pushing every garbage-product and service-into global market without restriction; however, same capitalism thrives by hiding fortunes from public view to evade taxes and avoid giving when needed.

Moreover, since capitalism creates so much surplus, which its owners are NOT READY to share or part away with, same system has devised various means to cover tracks from public scrutiny; one of such is offshore account system, which Mossack Fonseca is at the center at present.

Just like the powerful French officials of 19^th century hid financial condition of Panama Canal Company; today, powerful individuals hide their fortune from public glare.

Powerful and rich individuals worldwide through the instrumentality of law, which may not be necessarily illegal, but morally disgusting always move or repatriate funds from areas of needs to tax havens.

The world of humankind should not be silent to the evil of capitalism any longer, but rather insist on the Oxfam three-pronged approach:

·        A crackdown on tax dodging

·        Higher investment in public services, and

·        Higher wages for the low paid.

Governments worldwide, Bretton Wood Institutions-the World Bank and International Monetary Fund (IMF), should adopt Goldring therapy: “We need to end the era of tax havens which allow rich individuals and multinational companies to avoid their responsibilities to society by hiding ever increasing amounts of money offshore.”

With $6.7 trillion in offshore accounts in western hemisphere; 

“30 percent of African financial wealth offshore with estimated $14billion loss in tax revenue that can pay for children and mothers healthcare, save 4 million children’s live a year employ enough teachers to provide education for every African child.

This is the time-to begin a global war on tax havens, their promoters, and beneficiaries.

Time to save humankind from the grip of Capitalism.