.. his time on the witness stand provided an invaluable public lesson in how tax evasion, money laundering, and political corruption work.
.. The ability of rich people such as Manafort and his oligarchic clients to shuffle money across borders, beyond the purview of tax collectors and law-enforcement authorities, is a huge and intractable problem. In many places, these practices are
- denuding tax bases,
- corrupting a large class of professional enablers, and
- undermining public confidence in the political and financial systems.
.. roughly $7.6 trillion, or eight per cent of the world’s financial wealth, was held in offshore tax havens. In some countries, the proportion is much higher; in the case of Russia, it is more than half.
.. . In the United States, he has estimated, the annual tax loss is about thirty-five billion dollars.
.. It is only when there is a prominent court case or a leak—such as the 2016 Panama Papers, which exposed the dealings of the law firm Mossack Fonseca—that a light is shined on this system’s hidden mechanics. What Gates provided this week was a firsthand account of how the illicit game is played.
.. Manafort’s consulting firm was paid by Ukrainian businessmen close to Viktor Yanukovych, who was elected President in 2010. Many of these figures already had bank accounts in Cyprus
.. Gates described how he and Manafort used a Cypriot law firm to establish bank accounts in the name of shell companies that they controlled but weren’t publicly associated with.
“Did these companies sell a product?” Andres asked Gates.
“No,” he replied.
“Did they have any employees?” Andres asked.
“No,” Gates repeated. “The purpose of the companies was to accept payments and to make payments.”
.. The Cypriot law firm Chrysostomides “handled everything,” Gates said, including listing the names of locals, rather than the two Americans, as the directors of the shell firms into which the fees from Ukraine flowed.
.. he arranged to have money wired from the Cypriot accounts to vendors in the United States from whom Manafort had bought expensive clothes
.. problems arose, Gates said. So, again using the Cypriot law firm, he and Manafort transferred some money to bank accounts in the Grenadines, a chain of small islands in the Lesser Antilles. But, when the banks in the Grenadines were asked to transfer money to companies in the United States, they demanded invoices for the payments—something that the Cypriot banks hadn’t bothered with. At Manafort’s direction, Gates said, he created “modified invoices” and gave them to the banks.
.. “About 50% of the wealth held in tax havens belongs to households with more than $50m in net wealth,” Zucman, of Berkeley, noted in an article last year. “These ultra-rich represent about 0.01% of the population of advanced economies.”These were the type of people whom Manafort was working for in Ukraine, and it’s pretty clear from the life style he adopted that he wanted to join their ranks... he allegedly resorted to bank fraud rather than modify his spending patterns.Gates described how, in 2015, together with Manafort’s accountants, he helped put together bogus financial documents that Manafort then used to obtain bank loans... toward the end of Andres’s questioning of Gates, the prosecutor showed the witness an e-mail that Manafort wrote to Gates in November, 2016, shortly after Trump was elected. By that stage, Gates was working for Trump’s Presidential transition team. “We need to discuss Steve Calk for Sec of the Army,” Manafort’s e-mail said. “I hear the list is being considered this weekend.”
.. When he joined the Trump campaign, he’d long been known as the ultimate swamp creature. Thanks to Mueller and Gates, we now know more about how that swamp operates.
Trump’s Tax Push Begins
The best test for judging any Trump administration tax plan is the Mnuchin test — the standard that President Trump’s own Treasury Secretary, Steven Mnuchin, laid out a few months ago:
“Any reductions we have in upper-income taxes will be offset by less deductions, so that there will be no absolute tax cut for the upper class. There will be a big tax cut for the middle class, but any tax cuts we have for the upper class will be offset by less deductions that pay for it.”
I’ll repeat the key phrase for emphasis: “there will be no absolute tax cut for the upper class.”
Mnuchin was right to make this commitment. While middle-class incomes have stagnated, the top 0.01 percent of earners have had their average inflation-adjusted income roughly quadruple to $11.3 million since 1980. Their taxes have fallen, too. There’s no justification for cutting those taxes further.
Yet on Wednesday Trump, with Mnuchin as the pitch man, proposed precisely that, violating Mnuchin’s own standard.
Whitey on Mars: Elon Musk and the rise of Silicon Valley’s strange trickle-down science
Musk’s plan to colonise Mars is a sign of an older and recurring social problem. What happens when the rich and powerful isolate themselves from everyday concerns? Musk wants to innovate and leave Earth, rather than to take care of it, or fix it, and stay. Like so many of his peers in the innovating and disrupting classes, Musk prefers to dwell in fantasy and science fiction, safely removed from the world of here and now. Musk is a utopian, in the original Greek meaning: ‘no place’. Repulsed by the world we all share, he dreams of a place that does not exist.
.. Before his death, King had turned his political activism toward the problems of economic inequality and poverty. Abernathy stayed with this focus, and continued to organise people around addressing economic issues for black and white Americans. In July 1969, with the Apollo 11 launch, Abernathy saw an opportunity to keep economic justice on the nation’s conscience. He announced a march to Cape Canaveral in Florida, the rocket launch site.
.. Abernathy told NASA officials, as one of them recalled: ‘The money for the space program should be spent to feed the hungry, clothe the naked, tend the sick, and house the shelterless.’
.. Abernathy’s insight about the priorities of a country that could send men into space while millions of Americans lacked medical care, shelter and food found a new voice in Gil Scott-Heron.
.. US adventures into outer space – white men in expensive, gleaming white spaceships – captivated popular attention and support in ways that urban poverty did not. Americans continued to send their tax revenues to the heavens.
.. US adventures into outer space – white men in expensive, gleaming white spaceships – captivated popular attention and support in ways that urban poverty did not. Americans continued to send their tax revenues to the heavens.
.. His parents divorced when he was young, leaving Musk to be raised by his abusive father. The boy developed the habit of detaching from reality and entering a dreamlike space of imagination. Later, he would envision new technologies in this state. As a child, he was known as a spaced-out nerd who corrected his peers’ mistakes. He was bullied. By his teen years, Musk fantasised about escaping South Africa for the US. After he graduated from high school in 1989, he followed through on these dreams, leaving behind his impoverished and racially divided country.
.. From his early days in business, Musk developed a reputation for harshness. He chastised one employee who missed a company event to be at the birth of his child: ‘You need to figure out where your priorities are. We’re changing the world and changing history, and you either commit or you don’t.’
.. Musk himself admits that, in his early years as a leader, he assumed that ‘other people will behave like you’. He grew frustrated when he realised that people didn’t behave like him. He lacked a natural ability to empathise with other people’s experiences and points of view.
.. For all its ideals and the great possibilities inherent in them, Tesla remains a company that makes toys for rich people.
.. Musk insists that humans in fact ‘need’ to go to Mars. The Mars mission, he argues, is the best way for humanity to become what he calls a ‘space-faring civilisation and a multi-planetary species’. This otherworldly venture, he says, is necessary to mitigate the ‘existential threat’ from artificial intelligence (AI) that might wipe out human life on Earth.
.. The idea that Google’s CEO Larry Page might create artificially intelligent robots that will destroy humanity reportedly keeps Musk up at night. ‘I’m really worried about this,’ Musk told his biographer. ‘He could produce something evil by accident.’
.. Musk estimates the cost of the Mars mission at around $10 billion per person. His goal is to reduce that cost to $200,000 per person. He said this would allow ‘almost anyone’ to save up and buy a trip to Mars.
.. For $1.5 billion, we could upgrade the lead-contaminated water infrastructure in Flint, Michigan; for $400 billion, we could repair the water infrastructure of the entire US. It’s jarring to think that one of the brightest minds of our age would rather fund 40 trips to Mars than keep children in his own country safe from poisoned water. It’s enough to make one wonder what led Musk to develop such contempt for the billions of humans who could never escape Earth.
.. ‘The idea that Mars will somehow save us from the decisions we’ve made is a false one.’ If we ‘truly believe in our ability to bend the hostile environments of Mars for human habitation, then we should be able to surmount the far easier task of preserving the habitability of the Earth.’
.. In his September 2016 announcement, he declared that a fully self-sustaining civilisation on Mars would need around 1 million people. From Earth’s current population of 7.125 billion, the Musk Million would bring 0.014035087719298244 per cent of it to Mars.
.. If Musk prefers the planetary scale of action, he could lead people to preserve our single planetary resource, also known as Earth, the only planet we will probably ever have. Even on Musk’s own optimistic terms, his adolescent space fantasies will benefit only 0.014 per cent of humanity. He makes the politicians who serve the 1 per cent seem like communists.
.. Quite simply, why not address the existential problems facing our society and our fellow humans directly? We don’t need trickle-down science.
.. The moral detachment of the plan signifies a deeper pathology that afflicts our culture of innovation, and celebrates innovators such as Musk, who are all too eager to play with gadgets and leave their fellow humans behind.