Mitt Romney isn't alone. The world's wealthiest citizens have socked away a mind-blowing amount of money in offshore tax havens: Likely around $21 trillion, but as much as $32 trillion. That's according to a new report from the Tax Justice Network, a British think tank. To put that in perspective, the combined gross domestic products of the United States and Japan are around $21 trillion.
This gargantuan stash of money belongs to fewer than 10 million people, and $9.8 trillion of it belongs to just 100,000 people, the Tax Justice Network estimates. Here are the countries that are losing the most money to offshore tax havens:*
While offshore tax havens have an image of being operated by shady banks in tropical backwaters, the report found that the majority of the $21 trillion was actually managed by well-known private banks. The three largest tax haven players are UBS, Credit Suisse, and Goldman Sachs. For more on the Tax Justice Network's findings, you can read their full report (PDF).
Correction: The original version of this article stated that the countries in the chart were the top offshore destinations for tax dodgers. In reality, they are the top sources of money sent to offshore accounts in places like the Cayman Islands.
Does the National Federation of Independent Businesses really represent small business owners—or billionaires?
Josh HarkinsonJul. 23, 2012 6:00 AM
While most Americans don't object to Obama's plan to raise taxes on the wealthy, they're less excited about raising them for family-owned barbershops and ice cream parlors. This may be why Mitt Romney often claims that collecting more taxes from high earners would hurt mom-and-pop employers whose profits are taxed as individual income. "This is a direct attack on small business," he declared at a recent campaign stop in Virginia. His argument has the support of a powerful ally: the National Federation of Independent Businesses (NFIB), a "nonpartisan" small-business advocacy group that has put defending the Bush tax cuts for the richest of the rich near the top of its political agenda.
Often cited as the leading voice of small business, the NFIB was founded in 1943 by a former US Chamber of Commerce staffer who thought that business groups were neglecting the little guys. Today it claims 350,000 members, chapters in all 50 states, and a $95 million budget. In May, the Washington Postcited the NFIB to back up Romney's attacks on Obama's tax plan, reporting that the group had given an F to the portion of Obama's budget that deals with taxing the wealthy.
The recession has devastated the finances of many Americans, but it has been very good to the Walton family. Since 2007, Walmart stores have been flooded with millions of folks who've lost their shirts in the housing bust, stock market crash, and stalled job market—people who can no longer afford to buy anything that isn't made in China and sold by someone making close to minimum wage. Using newly released data from the Federal Reserve's Survey of Consumer Finances (listed as "SCF" below), labor economist Sylvia Allegretto has put together this chart on the diverging fortunes of the Waltons and their customers:
As Josh Bivens of the Economic Policy Insitute points out, the six Walmart heirs now have more wealth than the bottom 42 percent of Americans combined, up from 30 percent in 2007. Between 2007 and 2010, the collective wealth of the six richest Waltons rose from $73 billion to $90 billion, while the wealth of the average American declined from $126,000 to $77,000 (13 million Americans have negative net worth). Here's a chart of how many average Americans it has taken over time to equal the wealth of the Waltons:
It may be no accident that rising income inequality in America since the 1970s has coincided with Walmart's meteoric expansion:
When things heat up in the Empire State, many of our nation's rulers join the Summer Colony, what Hamptonites call the influx of plutocrats and assorted helpers who seasonally fill the island's beach chalets. Escaping nearby Manhattan's heat and noise for a few months each year is one of the 1 percent's most cherished membership perks, but it may be going the way of groundskeeping graveyard shifts at The Creeks.* A growing class of Hamptonian super-rich now insist on commuting to their tranquil getaways by helicopter, thereby disrupting the peace of anyone beneath their flight paths. Hamptons' resident Frank Dalene, a founding member of the Quiet Skies Coalition, says billionaire industrialist Ira Rennert is the worst offender. Here's a video he recorded of Rennert's Sikorsky S-92 and other noisy choppers buzzing the roof of his home:
For more on Hamptons helicopter feud, read my story from the July/August issue.
*According to the book "Philistines at the Hedgerow," the previous owners of The Creeks, Albert and Adele Herter, employed gardeners who worked at night so as not to disturb the Herters during the day.
Cannabis station, a medical marijuana dispensary, is located at the site of a former gas station in Denver, Colorado.
Remember when the feds pledged to end raids on medical marijuana dispensaries that complied with state laws?
Psych! Like a trippy screen saver undergoing a phase change, the Justice Department has morphed its marijuana stance back into what it looked like during the Bush era, going on the offensive against dozens of medical pot operations. This week federal agents moved to evict Harborside Health Center, the nation's most respected (and by all accounts, most legally compliant) dispensary.
The Justice Department has certainly done a lot of weed-whacking in recent years, but mostly just around the fringes of California's $1.3 billion medical pot industry. Staying true to its word, it has targeted dispensaries that violated state law by, for instance, opening up too close to schools and parks. And it has used an obscure provision of the tax code to stipulate that dispensaries cannot deduct routine expenses such as rent and wages. It claims Harborside owes the IRS back taxes totalling $2.5 million.
But this week the department appeared to cross the line, breaking its 2009 pledge to leave state-compliant dispensaries alone. On Tuesday it filed papers to seize the properties in Oakland and San Jose where Harborside does business, alleging that it is "operating in violation of federal law."
In a statement, US Attorney Melinda Haag said she was now moving to target "marijuana superstores."
"The larger the operation, the greater the likelihood that there will be violations of the state's medical marijuana laws," she said.
Of course, size doesn't necessarily equate to disregard for the law. And either way, going after dispensaries that might break the law is a much different standard than targeting actual lawbreakers. But there you have it—even as the public becomes ever more tolerant of pot, the feds are becoming less so.