Puppet MastersS


Dollar

Loophole USA: The vortex hole in global financial transparency

bengal in boat
© www.tovima.grReciprocity adrift in upcoming storm, an offshore problem!
If people stash their wealth or earn income overseas, that is fine with us - just as long as their tax authorities get the information they need to tax that wealth or income according to the law, and as long as money laundering and financial crimes can be effectively tracked, and so on. Where there are cross-border barriers to the instruments of democratic societies, then there is an offshore problem.

The only credible way to provide the necessary information is through so-called automatic information exchange (AIE), where governments make sure the necessary information is available across borders, as a matter of routine.

For years we at the Tax Justice Network were ridiculed for advocating AIE: pie in the sky, many people said. The Organization for Economic Co-operation and Development (OECD), the club of rich countries that dominates international rule-making on tax and tax-related information sharing, was for years pushing its so-called Internationally Accepted Standard which was, well, the internationally accepted standard for cross-border information exchange, despite being only slightly better than useless. The message was that we should just accept this, and move on.

How the world has turned since a couple of years ago. The OECD is now in the middle of putting in place a system - known as the Common Reporting Standards (CRS) - to implement automatic information exchange (AIE). The CRS is the first ever potentially global system of AIE, and although it has major shortcomings and loopholes, it's potentially a giant step forwards from a largely transparency-free past.

Meanwhile the European Union had been moving ahead with plans to beef up its own, older plans for AIE, notably through amendments to tighten up its loophole-ridden Savings Tax Directive and other initiatives. The United States, for its part, has been rumbling forwards with its Foreign Account Tax Compliance Act (FATCA), which is, at least technically speaking from a self-interested U.S. perspective, fairly strong. In fact, the OECD's CRS is modeled on FATCA.

But - and here comes a big 'but' - how do these different initiatives mesh together? Might anything fall between the cracks?

The European Union, for its part, seems to be working hard and in fairly straightforward fashion to get its ducks in line with the CRS, the OECD's emerging global standard. It will be incorporating a lot of the OECD technical standards into EU law, in cut-and-paste fashion, and will add categories to include in the mix: such as covering the all-important insurance sector more comprehensively than the CRS does, and covering other categories of income and capital including income from employment, directors' fees, pensions, and ownership of and income from immovable property.

But the United States' position on meshing FATCA with the global standards? Well, now there's a story.

Comment: A lot has been made of the USA's failure to reciprocate. Reciprocation is not the intent. In fact, it will be a revenue detriment. The ability of the U.S. to house and shelter foreign money is akin to a secret business venture. It accumulates wealth at home by enticing foreigners looking for a tax haven. What the U.S. is trying to bring to transparency (and tax ramifications) in offshore holdings for its own citizens, it offers in secrecy, free of charge or disclosure, to non-resident individuals, corporations and other entities. It charges zero rate on some categories of income (including interest paid by banks and savings institutions to non-residents or foreign corporations and on certain types of corporate and government debt).

Without the requirement for income earned locally by non-residents to be reported to the U.S. government, it doesn't have the info available to exchange. In addition, gaps in U.S. money laundering allow U.S. financial institutions to handle the proceeds of a long list of crimes, as long as those crimes are committed outside the U.S. Also, several states provide shell companies, secret arrangements, and non-reported income that is kept secret from foreign home countries. These policies attract foreign dirty money. It causes untold damage to ordinary citizens of foreign countries whose 1% use the U.S. as their offshore hideaway, including tax-free investments directly into U.S. markets. One of the most notable is the case of U.S. bank Wachovia that helped Mexican drug gangs launder the proceeds of hundreds of billions of dollars. As stated by Time Magazine: "Suddenly America has become the largest and possibly the most alluring tax haven in the world."

See also:
EU Savings Tax Directive overview
Financial Secrecy Index: Narrative Report on USA
FINCEN new rules


V

Hackers claim to reveal true number of Ukrainian army casualties, official censorship

ukrainian troops
© Sputnik/Andrei Stenin
Ukraine's subversive hacker group CyberBerkut has published documents allegedly exposing dreadful situation with the Kiev's troops attacking separatist forces in the East: war crimes, tremendous loss of lives and wholesale desertion of entrapped troops.

The anti-government activists claim they have hacked personal computer of Ukraine's Judge Advocate General and copied a number of classified documents. These documents are allegedly exposing some dark secrets of Kiev's authorities regarding the real state of things in the zone of the so-called 'anti-terrorist operation' in the eastern Donetsk and Lugansk regions of the country.

The price of the warfare resumed by President Petro Poroshhenko in the east is terrifying. The hacked documents claim at least 1,100 servicemen of the Ukrainian army have lost their lives over the period of the last two weeks. Many dozens Ukrainian soldiers gave up to separatist forces. Ukrainian army has lost over 100 tanks and the armored vehicles.

Comment: Real? Faked? Either way, the figures wouldn't be surprising, given all the reports coming out of Ukraine in the past couple weeks. Here's South Front's latest update, with a section on the leaked documents:




Take 2

White House official says Afghan Taliban not a terrorist group but an 'armed insurgency'

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© ReutersTaliban fighters
A White House spokesperson preferred to talk of the Taliban as "an armed insurgency" rather than a terrorist organization during a press briefing, when a reporter pressed him about Army Sgt. Bowe Bergdahl's release.

Responding to a question posed by ABC's chief White House correspondent Jonathan Karl, deputy press secretary Eric Schultz argued the US can swap prisoners with the Taliban because the group is not a terrorist organization but "an armed insurgency."

During the Wednesday briefing, Karl asked how the US decision to swap Army Sgt. Bowe Bergdahl for five Taliban leaders held at Guantanamo Bay differs from the Jordanian government's trade of a convicted terrorist for the release of an Air Force pilot held by the Islamic State.

Comment: All these names given for the 'enemy' - enemy combatant, armed insurgency, terrorist group - sure can cause confusion for what seems like the same thing. Could that be the idea so plans can change when ever it suits them?


Bomb

Afghan children bear brunt of NATO's unexploded bombs

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© Reuters / Omar Sobhani
Ordnance left by parting international troops kills or injures about 40 people a month - the vast majority children.

International troops pulling out of Afghanistan have left behind a lethal legacy of unexploded bombs and shells that are killing and maiming people at a rate of more than one a day. The vast majority are children.

Bombs dropped from the air coupled with munitions left behind in makeshift firing ranges in rural Afghanistan have made parts of the countryside perilous for locals who are used to working the land for subsistence and raw materials.

Since 2001, the coalition has dropped about 20,000 tonnes of ammunition over Afghanistan. Experts say about 10% of munitions do not detonate: some malfunction, others land on sandy ground. Foreign soldiers have also used valleys, fields and dry riverbeds as firing ranges and left them peppered with undetonated ammunition.

Sherlock

Foreign troops in Ukraine? Of course! But they're not Russian

psaki
US-backed president of Ukraine, Petro Poroshenko, was among the elites gathering in Davos, Switzerland this week to attend the 2015 World Economic Forum. During his speech he made the remarkable claim that 9,000 Russian troops were currently fighting in Ukraine on behalf of the independence-seeking areas of the country. These 9,000 troops have brought with them tanks, heavy artillery, and armored vehicles, he claimed. "Is this not aggression?" he asked the gathered elites.


Comment: Oh puhleeze, Poroshenko! This is the first trick in the propagandist's playbook: asking questions loaded with implied but unfounded premises. The question is not "is this aggression?", but "is this true?" And no, it's not. It it were there would be that thing people in the reality-based world like to call 'evidence'.


The US was quick to amplify Poroshenko's claims, with US Ambassador to the UN Samantha Power Tweeting today:


State Department Spokesperson Jen Psaki was asked whether the US might at least admit that the missiles fired by the Kiev authorities into residential areas in eastern Ukraine this week were a violation of the September ceasefire agreed upon in Minsk, Belarus. She refused to admit as much, and in fact she refused to even admit that the shells killing scores of civilians this past week were fired by the US-backed regime in Kiev. "Russia is not complying" with the agreement was all she would say.


Comment: That is just low, Psaki. But then again, it's hard to stick to your scripted talking points and admit simple facts at the same time. That just shows how inhuman your talking points are - that you cannot acknowledge the illegal killing of civilians because it might expose your 'official' policy' as having absolutely no moral bearing.


Stormtrooper

SOTT Focus: Holocaust 2.0: Welcome to the jungle

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Fritz Gerlich was a German journalist during Hitler's rise to power. He was well known for his biting criticism of der Führer. One of his most controversial moments was turning Hitler's image into a composite where his facial features were exaggerated and he was arm in arm with a black woman.

In the article, Fritz suggested that readers apply Hitler's own science of physiognomy to Hitler himself, and when applied, it's clear Hitler isn't even Aryan, but of a Mongolian subtype. This insult was the final nail in the coffin for Fritz, who had consistently used the power of the pen to combat Hitler each step of the way. He was arrested and dragged off to Dachau while working on yet another Hitler exposé, and killed a little over a year later.

Gerlich serves as but one example of many journalists who were threatened, beaten and murdered for revealing the truth. Only in the dark can evil things hide. I draw this piece of history to your attention, dear reader, because I want to talk about some other modern-day journalists who were killed under questionable circumstances. It seems we have yet to learn the lessons we said we'd never forget.

Comment: Check out the first in this series:

Holocaust 2.0: Coming soon!


Bullseye

GMO agri-businesses invade Ukraine's bread basket

gmo corn
© unknown

At the same time as the United States, Canada and the European Union announced a set of new sanctions against Russia in mid-December last year, Ukraine received US$350 million in US military aid, coming on top of a $1 billion aid package approved by the US Congress in March 2014.


Western governments' further involvement in the Ukraine conflict signals their confidence in the cabinet appointed by the new government earlier in December 2014. This new government is unique given that three of its most important ministries were granted to foreign-born individuals who received Ukrainian citizenship just hours before their appointment.

The Ministry of Finance went to Natalie Jaresko, a US-born and educated businesswoman who has been working in Ukraine since the mid-1990s, overseeing a private equity fund established by the US government to invest in the country. Jaresko is also the CEO of Horizon Capital, an investment firm that administers various Western investments in the country.

MIB

Charlie Hebdo attacks used to justify increasing fascism in Europe, intel agencies to blame?

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After the bloody events in Paris, when journalists of Charlie Hebdo were murdered in the broad daylight, all across the globe numerous journals have been discussing who could benefit from this tragedy.

In some countries (primarily Muslim) the manifestations against the provocative publications of controversial cartoons of the Prophet that mocked the religious feelings of all Muslims are still on the rise. Some experts have linked these provocative anti-Muslim cartoons with the acquisition of Charlie Hebdo by the Rothschilds in December 2014, the latter of whom are constantly worrying about their profits. But now they can be fairly content since after these tragic events the number of copies sold increased tenfold!

Another group of experts believes that the attack on French journalists was the result of direct actions of Western intelligence agencies. Therefore, the consequences of the Charlie Hebdo massacre can be compared to those of 9/11 attack, such as the tightening of security in Europe. These agencies have been seeking ways to create obstacles to the spread of Islam in Europe, along with obtaining legislative support to establish total surveillance over the activities and private lives of Europeans. Political elites behind such agencies believe that democratic rights, the protection of which has been the focal point of all populist political speeches in the West, should be narrowed. Police control in Western countries is increasingly intrusive with each passing day, as the growing distrust and discontent of the European population becomes more apparent. Western elites have failed to put forward comprehensive social and economic measures that could ease this growing angst, therefore an increase in political activity, anti-government demonstrations, and electoral control over ruling parties was inevitable.

The recent two-day meeting of Foreign Ministers of the EU in Brussels, summoned to discuss the "urgent measures to strengthen the fight against terrorism." can be regarded as damning evidence against Western elites. It was of little surprise for experts that the topic of these discussions was the adoption of a EU version of the US Patriot Act, that is used by Washington to control not only its fellow citizens, but "allies" alike.

Snakes in Suits

Buying Democracy: Koch brothers plan to spend $900 million for 2016 presidential election

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© Bo Rader/The Wichita Eagle, via Associated PressCharles Koch in 2012. The Kochs and their advisers have built a robust array of political organizations
The political network overseen by the conservative billionaires Charles G. and David H. Koch plans to spend close to $900 million on the 2016 campaign, an unparalleled effort by coordinated outside groups to shape a presidential election that is already on track to be the most expensive in history.

The spending goal, revealed Monday at the Kochs' annual winter donor retreat near Palm Springs, Calif., would allow their political organization to operate at the same financial scale as the Democratic and Republican Parties. It would require a significant financial commitment from the Kochs and roughly 300 other donors they have recruited over the years, and covers both the presidential and congressional races. In the last presidential election, the Republican National Committee and the party's two congressional campaign committees spent a total of $657 million.

Hundreds of conservative donors recruited by the Kochs gathered over the weekend for three days of issue seminars, strategy sessions and mingling with rising elected officials. These donors represent the largest concentration of political money outside the party establishment, one that has achieved enormous power in Republican circles in recent years.


Green Light

Genetically modified potatoes close to arriving at U.S. grocery stores

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© Reuters/Philippe Wojazer
A new genetically modified potato is closer than ever to arriving in American grocery stores, but while advocates claim it can actually reduce the risk of cancer, opponents say not nearly enough is known to ensure public safety.

Created by the J. R. Simplot Company, 'Innate' potatoes were created by inserting extra genes into them - genes that are modified but that otherwise exist naturally in the potato. Through genetic modification using RNA interference (RNAi), scientists used these genes to shut down a few of the potato's other original genes - a process called gene silencing.

Some of the genes being shut down are those that cause bruising and create acrylamide when potatoes are baked or fried. Acrylamide is an amino acid which, in tests conducted on rats, has increased the animals' risk of getting cancer.


Comment: That's a great marketing strategy and one hell of a sales job. The fact that acrylamide has been linked to cancer doesn't mean GMOs are good for you or that eating them will prevent cancer.


There are also financial incentives behind gene silencing, and the Innate potato was designed to solve a big monetary problem. Farmers currently throw out 1.4 billion pounds of potatoes due to browning and bruising, costing them 15 percent of their profits each year. The fewer potatoes thrown out because of this, the more profit they can recoup off their yield.

While the US Department of Agriculture (USDA) approved the new varieties in November, the Food and Drug Administration (FDA) has yet to give the green light on the potato. It is looking into how the genetic modification has altered the chemical makeup of the potato, and whether that raises safety concerns.

The Center for Food Safety (CFS) is worried about the USDA granting the Innate potato a non-regulatory status, since GMO foods are not required to be labeled. As a result, the new potato will be sold to consumers without their knowledge.

Comment: See also: