The Digital Information Revolution

The Panama Papers is a series of documents that reveal the global nature of wealth, tax, and fraud. They consist of about 11.5 million statements released by a whistle blower from the Panamanian law firm Mossack Fonseca. He is only known by the name “John Doe.” He released the documents to a German journalist who enlisted an international team of investigative journalists to sift through the millions of statements. On April 3, 2016, after a year of analysis, they released the first news stories that would spark a firestorm of coverage and controversy that concerned wealthy individuals from almost every country across the globe.

The Panama Papers showed how the incredibly wealthy across the globe go to great lengths to make sure their money is not taxed. The most prevalent method of doing so is creating a “shell company.” A shell company is a company that is created for an individual to store their assets. It is most often created “offshore” or in another country. This is meant to make it easier to avoid taxes. Some countries do not have as strict tax laws or are more willing to bend the rules to get more business. These shell companies are either kept secret or more often not created in the owner’s name. They are often created in the name of a “registered agent” who is ultimately responsible to the actual owner. Often times the firm who is creating the shell company legally must ask for the name of the true owner. In such cases, savvy tax evaders will give them the name of yet another registered agent who is subservient to their own desires, but neglect to mention that they are indeed another registered agent and not the actual owner. All of this requires yearly payments to the registered agents but often is only a very minor fraction of what the owner would be paying in taxes if the assets were in legitimate accounts. A practice that is becoming less common but still exists is the issuance of “bearer shares.” These shares grant the ownership of a company to whoever physically holds the share. Most countries have recognized that this practice is only used for illegitimate purposes and have made their use illegal. 

What is truly interesting about the Panama Papers is the reason John Doe released them. The first paragraph of his “manifesto”, released after the documents, is as follows:

Income inequality is one of the defining issues of our time. It affects all of us, the world over. The debate over its sudden acceleration has raged for years, with politicians, academics and activists alike helpless to stop its steady growth despite countless speeches, statistical analyses, a few meagre protests, and the occasional documentary. Still, questions remain: why? And why now? The Panama Papers provide a compelling answer to these questions: massive, pervasive corruption.

John Doe believed that the massive, pervasive corruption in modern society was the cause of our current income inequality problem. Income inequality has come to the forefront of societal issues as shown by the Occupy Wall Street movement. Some believe the middle class is disappearing and not because they are becoming more affluent but because they are becoming less. Wealth is concentrated at the top of our society to an extreme which is almost unprecedented. John Doe believed a major reason for this was the practices that came out in the Panama Papers, those which Mossack Fonseca specialized in: the creation of shell companies to evade taxes.

John Doe didn’t believe that the concentration of wealth was the only issue, but that the concentration of power was just as severe. He believed that the Panama Papers were evidence that there is, contrary to popular belief, a ruling class in today’s society. In times past, ruling classes’ effect on the working class was more pronounced. In modernity, we see that the ruling class must be much more discreet in their actions because of the rapidity with which information spreads. 

“Then,” Doe says about the times of previous ruling classes, “military might was necessary to subjugate peoples, whereas now, curtailing information access is just as effective or more so, since the act is often invisible.”

This prevalent ruling class has more money and need spend less effort to conceal their tax evasion, fraud, and other crimes they see beneficial to their wealth and wellbeing. This leaves no place for the heroes of yesteryear who fought with arms and inspiration of their countrymen. Today’s revolutionaries are a part of an information revolution, a digital one.

As information has become the cornerstone of the modern economy, those who are willing to step out of line and reveal it have become famous and infamous. In the past few years we have seen the rise of names such as Edward Snowden and Juian Assange.   These digital information revolutionaries have shown the world that there is a point at which you cannot keep silent. Both of these men have been awarded the Sam Adams Award, not named after the founding father or the brewing company, but after a whistleblower during the Vietnam War. The award is given by a group of retired CIA members who realize the importance of integrity in intelligence. Intelligence being the CIA’s way of saying information.