Offshore Tax Havens & 70% Tax Rate: A History Lesson

Between 1945 and 1973, US Federal Government Individual income tax revenue remained relatively flat. It increased by 300% between 1973 and 1989.   And between 1989 and 2005 it increased again by about 300%.  These time frames loosened individual tax rates.  

In 2012, it was revealed that Mitt Romney had over $250million in offshore accounts immune from Federal taxation.   In 2015, The Atlantic published an article about offshore accounts in which the author quotes a gentleman she interviewed in the British Virgin Islands as stating that offshore accounts are a ‘left-leaning agenda’.   She also provided an interesting insight from the prospective of the islands chosen as the havens; ‘as the financial services industry gained momentum in these island havens crime rates shot up’.   But these offshore accounts aren’t only to evade income taxes, they also effectively hide money from potentially costly divorces and lawsuits, including government authority lawsuits, often empowering the elite to operate above the law with complete immunity.  

One form of an offshore account is called the ‘Asset Protection Trust’.   The Rothschilds are the largest progenitors of such arrangements, but most wealthy elite utilize these instruments routinely.   Facebook founder, Eduardo Saverin, utilized the loopholes of wealth protection by simply denouncing his US citizenship and re-establishing citizenship in Singapore.  Singapore’s top tax rate is 22%, $0 capital gains tax, and $0 inheritance tax.

While many people believe offshore banking is a relatively new financial scheme, it actually has its origins in 1815 in Vienna.  The reason? Exorbitant taxes imposed by monarchial governments.  France was the first EU nation to offer offshore haven to the elite and wealthy wanting to evade taxes and protect their money from the monarchies.  BY the end of the 1800’s these offshore accounts were estimated to hold billions.

After WWI, Caribbean offshore havens became the rage for wealthy Americans due to the proximity of the islands.  Americans saw these arrangements as a means to protect their wealth from wars and depressions.

In 1929, London courts declared that any monies held in offshore accounts were exempt from taxation by the British authorities.

Switzerland saw the burgeoning business and as competition had risen throughout European banks, Switzerland extended the policy of privacy;  The Swiss Banking Act of 1934 made it illegal for banks to provide personal or account information on any of its clients even if requested by government authorities.

All these havens gained traction when the British and US governments began attempting to rail in the offshore accounts by raising the top tax bracket to 70%.   As such the beginning of the collapse of middle income earners began its descent creating the ever growing skew of income disparity. In the US it came as a consequence of the election of FDR, a Democrat, who ushered in The New Deal by Executive Order and the confiscation of all personal holdings of gold. As an ally of Stalin, FDR mobilized the war effort of WWII – but by then the wealthy elites of the US did not participate in the financial application given their money was safely harbored in offshore accounts and unattachable.  His actions were likely the springboard that ushered in the greatest leap into income disparity in history since monarchial rule.

The purpose for the confiscation of personal holdings of gold was to bail out the private banking system known as the Federal Reserve which had over-extended its credit.   As European countries presented their notes demanding gold in exchange which was supposed to be held in US Reserve banking institutions, the Federal Reserve realized they didn’t have the physical gold to pay off the notes so FDR simply confiscated personal holdings, and gave it to the Federal Reserve so as to payoff reserve debt owed to European countries.

The Chairman of the Federal Reserve at this time was Eugene Meyer, an American financier who was cited as being worth $40 million as of 1915.   In today’s dollars adjusting only for inflation, $40million would equate to just shy of $1billion.  Along with JP Morgan, Andrew Mellon, and Ogden Mills, Meyer and his entourage were known as The Four Horsemen of The Apocalypse.   In 1933 Meyers bought the Washington Post and his descendants held it until it was sold Amazon’s Bezos in 2013.  Including during the blitz of the CIA agenda, Operation Mockingbird. 

In the end, the 70% tax rate taught us that the higher the rate the more likely wealth managers will help you find a means to evade taxes putting a heavier burden on the remaining middle class and lower class to fund the government, depleting Social Security as deficits borrow from the fund, and ultimately bankrupting the economy.  So Ocasio-Cortez and Bloomberg and Gates and Buffet, and all those wealthy elite who support such a tax increase will be laughing all the way to the Cooke Islands at the stupidity of those who think this is a solution to anything.

FDR was independently wealthy having inherited everything and never working in the real world business sector.   He and the elite wealthy of the time are directly responsible for the evolution of tax evasion, the quash of the middle class, and the rise of wealth disparity.  They were Democrats and they were Republicans, they were The Swamp.

Paradise Paper Caper – Who’s Who

The Paradise Papers have unraveled a web of offshore dealings far more intricate, complex and massive than the Panama Paper Caper. Comprised of over 13 million documents, the magnitude would appear to leave no one immune, but oddly, the headlines continually show Trump at the forefront as though he is the leader of the pack, when in reality, to date, he is not personally implicated at all…

In addition, headlines would tout the “massive dollars offshore accounts contributed to the Trump election”  through private means, ie, $60 million, while truly failing to headline that the actual leaders within the disclosures include; Credit Suisse, Soros, Apple, Facebook, Nike, Siemens, Google, Trudeau’s closest friend and Liberal Party fundraiser, Maciel, a Catholic Priest, Madonna, Bono, Chuck Schumer, and a host of Democrat mega-conglomerates.

It is interesting that despite the fact that Soros is a major donor and supporter of the International Consortium of Investigative Journalists (ICIJ) credited with releasing the trove, Soros and The Open Society were quite prolific in their offshoring…and have declined comment on their role.

Obviously plastering Trump’s picture on the trove is media deflection to protect the true sullied faces of Zuckerberg, Soros, and Urs Rohner, Chairman of Credit Suisse. Lest we forget, in 2014 Credit Suisse pleaded guilty to tax evasion and fraud and paid a $2.6 billion fine.   And Soros companies are mainly non-profits, therefore the true offshore evasion would potentially indicate that charities are not the recipients of his funds at all, but perhaps the money is funneled through intricate webs back to it’s source – Soros.

One of the more fiendish finds was the fact that numerous US universities have been hiding hordes of cash in offshore accounts all the while demanding huge subsidies from the federal government, raking students with increased tuition and fees, and defrauding their true financial picture.

Bush’s brother is named, The Queen of England is named, as well as Warren Stephens a conservative presidential donor who is behind massive ‘anti-Trump’ campaigns.

Putting Trump on the face of this leak is an obvious fraud and a rather lame intent to defraud, deflect and hide.

Guilt By Association is a collective concept that declares that members of a group can be held responsible for the actions of one. If we were to apply this same theory to Soros, that would imply that Obama, Clinton, McCain and a host of others should be heralded with their pictures splashed across headlines – as the offshore perpetrators.

While the actual use of offshore accounts is not illegal, sometimes they are used to circumvent the law and to launder money. It’s a black market of sorts in which organized crime finds a legal means to invest illegally obtained funds. They are used to hide assets and to evade taxes. Insurance and reinsurance companies are notorious for utilizing these havens, not just for their companies, but their executives as well make use of the advantage to avoid taxes.

Trump’s new tax reform addresses this evasion by offering a one time reprieve at a significantly lower tax rate for reclaiming into the US monetary system the trillions that are floating.

It would see that the same individuals advocating against Trump’s tax reform are the exact same ones who utilize this offshore evasion loophole. Because bringing that money back into the system will have an enormous positive effect on the economy – which would not boost the Democrat agenda.

So how do they defeat the revelations? Manipulation. The media is claiming that over 120 US politicians are implicated in the release and yet they reveal mostly those who have some relationship with Trump or the GOP Party.

While the journalists pour over the trove of 13 million documents, what is actually released to the public will most likely lean toward the agenda of the journalist’s media conglomerate… and not the agenda of Truth.

At least, that is what they are doing now…

 

Trump Tax Plan – Hoopdela

Trump has released his outline for tax reform and the mainstream are going google nuts! They are absolutely convinced that this is a wealthy tax reform that will plunge revenues into the twalette!! The highest tax bracket of 40% will be reduced to 35% and this will decimate the Federal government pockets. OMGosh.

Really?

Because according to the IRS, in 2015 (latest year available), the average tax rate for the 1%ers was just barely over 27% although they still picked up about 38% of all income taxes. The top 50% of taxpayers had an average tax rate just under 15%. And the bottom 50% paid a meager 3.3% in taxes on average and only represented 2.78% share of all taxes collected.  Well how do ya like that!  This aligns rather well with Trump’s plan, unless you are an overpaid tax preparer, an IRS employee, or a Pundit.

One decrier of the plan is Bill Maher, a comedian with a degree in English and History. I suppose that qualifies him to evaluate and analyze finance? Another critic, Ryan Struyk of ABC quoted the ‘bipartisan’ Committee For Responsible Federal Budget.  

It’s current President, Maya MacGuiness, whose background bio includes such media notables as Washington Post, New York Times, The Atlantic, Financial Times and LA Times – all bellwether diehard Liberal organizations, is predictable. In addition, she held a post at the Brookings Institute, another Liberal organization. Hard to classify as ‘nonpartisan’.

The Board is weighted heavily with democrats, including Leon Panetta, Charles Schultz, Robert Strauss, etc… And formerly associated with the New America Foundation, a Soros supported organization. They took a special interest in Obama and McCain in 2008… lauding their budget campaigns. In other words, it is hardly the most reliable in terms of ‘nonpartisanship’.

For the lower 50% tax filers, the greatest advantage is increasing the standard deduction which effectively makes the first $24000 of revenue nontaxable taking a hefty stresser off the table. Critics of the plan continue the same rhetoric as always without ever understanding the main punch – lower tax rates mean more income will flow back into the US instead of ending up in the Caymans, Bahamas, Cyprus and all the other tax havens that wealthy taxpayers enjoy – including Hollywood elitists.

Another ‘nonpartisan’ organization offering their opinion is the Urban Brookings Tax Policy Center whose current President Mark Mazur was an Obama appointee as Assistant Secretary for Tax Policy. The previous president, Leonard Burman, worked in the Bill Clinton White House.  Funding comes from Ford Foundation, Rockefeller Foundation and Gates Foundation…Sigh…Gee REALLY?  All quite Liberal.

I think a part of the failure of the analyses is that it comes from people making tons of money, they don’t understand the mentality of someone making just enough to pay the bills, and can’t predict that reaction. In contrast, failing to take into account the offshore money is very short-sighted. Failing to look at the sources of tax revenue historically, is also short-sighted.

Failing to check your SOURCES – is also pretty critical.

According to the Liberal MSM, The New York Times, The Cayman Islands hold $1.9 trillion in US dollars on deposit. The Swiss hold $3 trillion in Swiss francs. IBC’s and trusts account for trillions. In fact, it has been estimated that between a third and a half of all the wealth of the world’s high net worth individuals is sitting in offshore accounts. Why?

Taxes.  And its not coming back unless there is an incentive.  Pretty basic economics.

The other half of Trump’s tax plan affects businesses by cutting the rate from a top tier of 39.6% to just 15%. Ultimately this will encourage spending, additional hiring, and raises. It won’t happen overnight. But this effect could be the biggest equalizer encouragement. The effect of lowering tax rates has been proven over and over again as an economic stimulus.

In this instance it has the added bonus of encouraging large corporations who have offshored their headquarters to tax haven countries, to relocate back to the US.  Despite all the analyses, this one equalizer has not been utilized in making predictions.  Why?  Because it hasn’t happened.  Corporations keep moving away – they don’t come back unless they have that diehard gravity – incentive!

Again, this will take time to implement in terms of feeding the economy, but the measures could sharpen the revenue stream significantly.

While some Republicans eagerly proffer negative reviews claiming the tax reform will not ‘blow holes in the deficit’, they seem to miss the point that – THAT is NOT the Point. It is as though the search for a negative no matter how forlorn, far-fetched, ambiguous, destructive, or just plain ridiculous, is the only agenda.

It’s an ego war.  ‘Well I didn’t think of it, so therefore it probably won’t work…’

Even more telling:   How can these in-depth, analysis Committees and policy groups and pundits release their ‘in-depth analysis and criticism’ one day after the outline is made public?   Because in the real world, such analyses typically take months, if not years, in government circles. They require complete knowledge of the entire plan, not just an outline, as Trump provided. They require multiple experts plugging in numbers, ratifying data, creating algorithms, and then fixing all the inevitable mistakes they have made, resubmitting left out data, and creating new templates.

But then it wouldn’t make for good Entertainment and media mania…