Why do the Tories think they can bet with insider information, as they obviously did before the election was called? It's because they think that the rules that society creates do not apply to them.
This was also, very obviously, true with regard to Covid regulations.
Those with the Tory mindset are privileged, usually wealthy, arrogant and inclined to look down on the rest of society. None of those are necessarily endearing features in themselves. The last two are most definitely not. But when they break the rules as a result of their holding such views, what astonishes Tories is that there are rules that might apply to them.
This would be irritating but for the fact that this attitude of exclusion from the general rules of life is not just about the behaviour of the idiots who have staffed 10 Downing Street during the last few years. It is much more important than that.
Over the last couple of days, I have (whilst also blogging quite a lot) been attending a workshop/seminar at the University of Sheffield on free spaces. In my terms, these are freeports, tax havens and the like. The discussion was, however, much wider, looking as well at the carving out of urban spaces for exclusive use by the wealthy as another particular aspect of this ideology that there should be places where the normal rules do not apply to those who happen to live, work or run businesses there, usually to their considerable economic and/or social advantage.
Working with Andrew Baker, my contribution was to discuss how we can appraise the impact of these spaces using a variant of tax spillover methodology. This will be developed over the coming months as we think there is something in this approach that allows a qualitative appraisal when quantitive approaches are likely to be very hard to use simply because of the absence of any reliable data.
However, at this moment, I want to draw attention to another paper on this issue that I wrote in 2009. It is called 'Defining the Secrecy World: Rethinking the language of ‘offshore'.
As is noted in the summary of the paper:
This paper sets out to show four things.
The first is that the existing language of the so-called ‘offshore world' is inappropriate for the purposes of rigorous analysis of the issues to which that term has been applied. The paper offers a new language for this purpose. In that terminology, the term offshore is replaced by the term ‘secrecy world'.
Second, it suggests that the assumption that the secrecy world is geographically located is not correct. It is instead a space that has no specific location. This space is created by tax haven legislation which assumes that the entities registered in such places are ‘elsewhere' for operational purposes, i.e. they do not trade within the domain of the tax haven, and no information is sought about where trade actually occurs.
Thirdly, this paper shows that the illicit financial flows that are the cause of concern with the secrecy world do not flow through locations as such, but do instead flow through the secrecy space that secrecy jurisdictions create (secrecy jurisdictions being the new term tax havens).
As the paper shows, to locate these transactions in a place is not only impossible in many ncases, it is also futile: they are not intended to be and cannot be located in that way. They float over and around the locations which are used to facilitate their existence as if in an unregulated ether. This suggests that any attempt to measure or regulate them solely on a national basis will always be problematic.
Finally, this paper suggests that the change in language that it promotes is consistent with existing understanding of the observed phenomena and adds new dimensions to the lexicon of offshore / the secrecy world.
We hope that this new language will allow regulators to extend the scope of their work whilst also reducing the scope for sophistic and casuistic arguments put forward by those who exploit the secrecy world for personal gain.
What's the relevance of this? Very obviously, this also applies to freeports.
But more than that, it shows that those capable of creating such spaces must also be capable of creating spaces in their own minds where they really do believe that the normal rules of society do not apply to them - because they actually create legal structures that say that this is not the case.
The trouble for the Tories - and also for all those politicians in Labour, the SNP and the LibDems who also believe in freeports - is that once you believe in this fiction, you do four things.
First, you govern on the basis of fantasies, and not realities.
Second, you undermine the rule of law.
Third, you state that some people who are privileged within a society because the normal rules do not apply to them.
Fourth, you undermine democracy as a result.
And that is what is really happening in the UK right now.
But when you do that, you also begin to believe the fiction. And when you do so, you behave as if it is true and do not follow the rules of election gambling.
As for that paper, it changed the narrative on tax havens, quite literally. The term secrecy jurisdiction came into common use. More importantly, it changed the direction of international regulation of these spaces. moving it from tax onto secrecy. Changing a few words can help restore reality. But, it requires someone to point out the truth for that to happen.
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There are many features of Freeports and SEZs that I find deeply concerning. This being particularly distasteful- from Byline Times “On what terms will employment be offered within the zone? Effectively, the zone falls outside of national standards for wages, workers’ rights, and working conditions.“
The suspension of human and legal
rights within these proposed Charter City Areas is shocking and disgusting. The constant push by certain individuals in the UK political arena, using the opposition to human rights abuses within the anti immigration Rwanda Act as a media lightning rod, to drag the UK out of the European Court of Human Rights, has far more to do with the desire for their secret corporate funders desire to see the destruction of all workers’s rights, than the tackling of illegal immigration.
A good society is a fair society.
Insider trading is not fair.
Freeports are not fair.
Tax havens are not fair.
A two-tier National Health Service is not fair.
Any political party that supports policies that are not fair, is in it for themselves, or their masters.
The philosophy of the free ports which Richard gives us so clearly, is not a new phenomenon.
The Western powers imposed ‘Treaty Ports’ on China in the 19th century to enforce trade. They did the same in Japan but they were closed before 1900. The Western powers established their own laws -extraterritoriality -over the areas.
Mass produced western goods under priced the goods made by the cottage industries of China creating great hardship. It wasn’t just the opium trade.
Industrialisation meant the mode of production changed. It could not be un-invented. Even Marx agreed.
There was a widespread view in the late19th and early 20th centuries, that the US and Europe had to have expanding markets to continue to grow the economies. Lenin built on the writings of Hobson to claim Imperialism was the highest stage of capitalism. It took two world wars create a new economic paradigm -which in some ways is as exploitative as the old one.
To the Chinese the period 1840 (Opium war ) to the establishment of the Communist state, in 1949, is a “century of humiliations.” I deplore the excessive authoritarianism of China, but we need to remember the history to understand their attitude. The past casts a long shadow and we need to be aware of it.
Thank you and well said, Richard.
Another episode was when the wife of a Tory minister and leader on the vaccines programme flew to NYC to share data from testing and update on vaccine roll out to Wall Street investors when travel was not advisable and such information was confidential and could lead to insider dealing and market manupulation.
Colonel
you are a mine of information. If you were free to write a book, it would be a compulsive read for FtFers
Thank you, Ian.
I am fortunate to have an interesting job and come across such issues.
It also helps that I’m a history enthusiast and went to school and university and worked with and for people whose names feature in history and the papers.
I often think that these connections should be mapped.
I sometimes quip that if the public became aware of how this country is run, Corbyn would be appointed president for life soon after.
🙂
I remain amazed that these free zones are of no great interest except to a few in this country. When still in Labour I brought this up, and was told it was a paranoid conspiracy theory (the Charter City movement and the involvement of people like Singham and Thiel). The potential is frightening.
The level of corruption in the UK is truly shocking. We have many words for it, e.g. dodgy, cronyism, — we should choose instead to always use corruption. I was fortunate to spend 11 weeks at the end of last year travelling through Southern Africa (Tanzania, Malawi, Mozambique, Zimbabwe, Zambia, Botswana and South Africa) – by public transport. A key word for me on this trip was ‘governance’ – and I was often sub-consciously comparing things to the UK. As readers here know too well, poor governance and corruption impact deeply, quickly and are difficult to undo.
I know that GDP is not a great measure, but look at those countries GDP from the CIA WorldFactBook (in ‘000s USD PPP) and levels of corruption. Tanzania (2.6), Malawi (1.5), Mozambique (1.2), Zimbabwe (2.1), Zambia (3.2), Botswana (14.8), RSA (13.3). Zimbabwe has fallen a long way. In Botswana, people were proud of their vibrant society – supermarkets had signs encouraging whistleblowers to call out corrupt behaviour. In contrast, in Malawi the police openly demanded money at road stops. see a nice graphic on perceptions of public sector corruption here: https://en.wikipedia.org/wiki/Corruption_Perceptions_Index.
Now, here in the UK, we have ministers who think it is OK to divulge contact details to casual pick-ups, give contracts to their buddies, bet on confidential government information ….. lie to everyone (including the monarch), cover up, modify the rules to protect their buddies, oversee sending innocent people to jail, turn a blind eye to incompetence and corruption and seem incapable of project delivery. Governance. And in this environment, we allow donors to support those peoples’ political parties. What could possibly go wrong ?
Thanks
Thank you and well said.
The paragons of virtue, the US and EU are no better.
I worked at a German bank for some years and was stunned how corrupt Germany is. Latin colleagues and friends are very cynical about northern Europeans, especially Germans.
Mum is a government auditor and has horror stories going back decades.