Donald Trump and the Panama Papers
The global scandal has big implications for the GOP front-runner
While we in America have been largely preoccupied with our scandalous Presidential primaries, the rest of the world has been rocked by a different scandal, the so-called Panama Papers. Sometime last year, the German newspaper Süddeutsche Zeitung received a treasure trove of documents from an anonymous source. The massive leak consisted of 11.5 million documents from inside a Panamanian law firm called Mossack Fonseca which specializes in creating offshore shell companies. On April 3rd, the International Consortium of Investigative Journalists began to publish the first reports based on the leaked documents. The documents, which contained over 40 years of records, exposed the shady financial dealings of some of the world’s most powerful people, including twelve current or former heads of state.
While not always used for illegal purposes, offshore shell companies are often used by the rich and powerful to hide their wealth from tax authorities and mask their financial dealings from the interested public. The leaked documents provided proof that many world leaders and their inner circles have been using offshore shell companies to avoid paying taxes, hide their investments, and avoid public scrutiny of their shadiest deals. Here is just a small sample of the things they revealed:
- Members of Vladimir Putin’s inner circle have channeled over $2 billion through offshore entities for unknown purposes.
- Family members of Chinese President Xi Jinping and three of the seven members of the country’s elite ruling council have used offshore accounts to conceal and store their wealth.
- Azerbaijan's newly elected President, Ilham Aliyev, secretly owns large stakes in some of the country’s biggest companies.
- Prime Minister David Cameron of the UK has been receiving income from an offshore company set up by his late father.
- The Prime Minister of Iceland, Sigmundur David Gunnlaugsson, used an offshore shell company to avoid disclosing certain investments, a violation of his obligations to the public as a member of parliament.
The fallout from these revelations has been huge. In Iceland, the Prime Minister was forced to step down after massive (for Iceland, anyway) public demonstrations. In Argentina, President Mauricio Macri is under investigation by a federal prosecutor. Vladimir Putin has been forced to deflect criticism by dismissing the whole thing as an American plot. In Australia, the government has launched an investigation into 800 citizens listed in the leaks. China’s government has taken to censoring all mentions of the scandal on the internet and in the media.
UK Prime Minister David Cameron’s government has been thrown into crisis by the scandal. Cameron, who has been a vocal proponent of financial transparency, has been forced to defend his finances before Parliament and fend off public demands that he resign. The crisis is on-going, so it is difficult to assess the full damage yet. But it is safe to say this scandal has been, at the very least, an unwelcome distraction for the Prime Minister’s office. Surely they would rather be focusing on their up-coming referendum on whether or not to leave the EU. Again, this is just a sample of the fallout from the Panama Papers. Similar crises are brewing in at least a dozen other governments around the world.
What does this have to do with Donald Trump?
The explosive reaction to the Panama Papers by citizens across the globe demonstrates how important it is that our leaders be 100% transparent about their finances. We as citizens have the right to know what our leaders are doing with their money. We deserve to know if they are paying their fair share of taxes. We deserve to know if they have financial conflicts of interest. This information matters because it speaks to the character and ethics of our leaders.
But it also matters because failing to disclose this information can become a very real threat to the stability of our government. This is the lesson of the Panama Papers. Governments around the world are in crisis right now because their leaders didn’t disclose their personal financial information. One head of state has already been forced to step down. Others are on the brink or under investigation. All of this unrest and instability could have been avoided if the leaders in question had been transparent about their finances.
This is where Trump comes in. Incredibly, despite all of this, the Republican front-runner still hasn’t released his tax returns. Even more incredibly, voters are letting him get away with it. Despite the fact that he promised to release them 14 months ago; despite the fact that it is a long-standing expectation for any presidential candidate; despite the fact that every other candidate released theirs months ago, Trump has casually dismissed all calls to release his. When pressed on it in a debate in February, he said he couldn’t release them because he is being audited. The IRS issued a statement in response saying that Mr. Trump is free to release his returns whenever he wants.
He still hasn’t released them. This is troubling because as the only billionaire businessman in the race, his returns are the ones most likely to contain something of interest to voters. His steadfast refusal to release them begs the question: what is he hiding? And for that matter, why is he being audited? Somehow, this has never become a major issue in the campaign. Every time it starts to become a story, some other headline-grabbing Trump fiasco seems to draw the media’s attention away from it. The Panama Papers are a wake-up call. Our complacency on this issue has to stop now.
This should not be a partisan issue. There should be nothing controversial about transparency. All voters, including those supporting Mr. Trump, have the right to know this information. If Mr. Trump has nothing to hide, he should release his tax returns like every other candidate in recent memory has done. If he is hiding something, we must insist, persistently and vocally, that we know what it is. Voters should declare that they will not cast a vote for him until the tax returns are released. We should take to social media and demand that the #TrumpTaxReturns be released immediately. If given the chance by a contested convention, delegates should demand to see the tax returns as a condition of their support. This isn’t petty politics. It is basic prudence.
The Panama Papers demonstrate why our failure to hold Mr. Trump’s feet to the fire on this issue is reckless, short-sighted, and foolish. The kinds of bombshells revealed by the Panama Papers are exactly the reason we ask our Presidential candidates to release their tax returns. And the massive fallout from the scandal demonstrates exactly why it is so important that they do so. It is our responsibility to force the issue. If there is something in there we need to know, now is the time to find out. Not after we have already nominated the guy. Not after we have elected him President.
Now, while we still have a chance to nominate someone else.