Why we forget about the hoarding of money in tax havens
IT IS time we reluctantly admit that billionaires run the world.
Yes, those unicorns who have been able to find a way to have more money and resources than the rest of the world. Who decide to journey to space because they want to and there’s no one to really tell them otherwise.
That’s the power of billionaires. We are obsessed with them, the things they do with their money, the control they wield and the things they do to preserve their wealth.
We follow their every move, avidly look forward to the many rich lists and wealth rankings that are published every year, detailing the extent of their wealth, even though we are aware only some of their earnings are listed.
It’s partly why we also cannot get enough of productions like Billions, The Crown, Succession, The White Lotus, Bling Empire and even Real Housewives. The antics of the wealthy leave us in disbelief and nursing a feeling of disgust at the hoarding of wealth, so much so that some have even come up with the phrase “eat the rich”.
However, it doesn't stop us from consuming the content. Instead, we wait with bated breath for the next season or sequel, ready to dive into a world we know we will never belong in. We are on the outside looking in, feeling the injustice of life.
Take Succession, the Emmy-winning drama, which returns for a third season on October 18. The show, inspired by Rupert Murdoch and his children, explores the King Lear-esque power struggle between the children and how Logan Roy, the character, enjoys playing them off against one another.
And yet there is not one character we like. They are awful people whose entitlement and self-preservation makes them impossible to like. Sure, you may root for one character to destroy the other, but it’s only because someone has to come out on top.
They have no ethics, little moral fibre and will always find a way to cheat their way to success. Once again, it’s about self-preservation. They are aware of their privilege, wield it like a weapon and use it to get away with murder, both in the literal and figurative sense.
The show was the first thing I thought about when the revelations of the Pandora Papers were reported last weekend.
The Pandora Papers are the nearly 12 million leaked documents obtained by the International Consortium of Investigative Journalists and shared with journalists in 117 countries. They reveal the extent to which the world’s wealthy use offshore companies to conduct business. The files include images, emails, spreadsheets and various other forms of documents gathered from companies that were hired by their wealthy clients to create offshore structures.
The world's wealthiest are among the most avid users of offshore companies and they turn to tax and secrecy havens for a variety of reasons.
The Washington Post reports that more than 130 billionaires who have appeared on the Forbes list of the rich turn up as owners or beneficiaries of offshore assets and they all appear on the documents.
The African News Agency reported that in many countries it is not illegal to have shell companies in order to do business abroad or possess offshore assets. However, doing business abroad gets tricky when companies shift profits from high-tax countries to low-tax jurisdictions.
Reading the reports about the Pandora
Papers got me thinking about how this could be the focus of the fourth season of Succession – it’s something the Roy family would be involved in. Even Billions could tackle the topic in follow-up seasons. It’s something Bobby Axelrod and his Axe Capital employees would do for themselves and their clients.
Among the things the Pandora Papers reveal are how the 1% own property in the most expensive cities in the world, luxury yachts, artwork, jets and other assets. They are able to acquire the most exclusive and rarest jewels.
They own islands and villas they can disappear to when life gets too hectic (this is probably what Mark Zuckerberg will do after losing $7 billion (about R105bn) during Facebook’s outage earlier this week.)
And it is these luxuries that keep us watching the shows and films or, in the case of Crazy Rich Asians, reading about the exploits of billionaires.
Kevin Kwan, who wrote the best-selling Crazy Rich Asians books, detailed just how the ultra-wealthy Asians spend their money. From cosmetic surgery for Arowana fish to couture shopping in Paris after travelling in Boeing jets fitted with nightclubs and spas.
“So many aspects of and stories in the book I actually had to tone down,” he told Vanity Fair in 2013. “The reality is simply unbelievable.
“They say truth is sometimes stranger than fiction, but there’s such a thing as believability when you’re writing a novel. I did a lot more simplifying and cutting out of the decadence and the excess than I did by adding it on, if you can believe that.”
It is this visual feast of luxury, a wealth voyeurism really, that somehow makes us not get enough of billionaire content. Even with the characters’ terrible behaviour, it is somehow made better by also seeing them immersed in the luxurious things their wealth buys for them.
The Pandora Papers are a reminder that the wealthy have a different set of rules they live by.
There are many loopholes in the system that allow them to amass wealth of incredible proportions and then hide it. The system makes it possible for them to shield their wealth, by doing acquisitions of assets and the elaborate schemes of moving money around between bank accounts, which helps them to hide their true wealth and evade taxes.
In a world where being wealthy beyond acceptable means is celebrated, we shouldn’t be alarmed that this is happening and high-profile figures, including celebrities, royals and government figures, are fingered in the reports.
Like how Succession, Billions and even Dynasty have shown over the years, the wealthy will do anything to preserve their wealth and even dabble with money laundering to make sure no one ever knows their true net worth.
It’s all a part of the game. And that is why TV shows about the 1% will always fascinate us.