Hundreds of Them Living in a Single File Cabinet
This one takes a look at the offshore tax shelters which corporations use to avoid hundreds of billions of dollars of tax liability, thereby leaving... you and me... to carry the load, while our country sinks deeper into debt.
George Town: June 1
Authorities in Cayman Islands reacted swiftly today in the wake of a scathing exposé of housing conditions in this small island territory. The world’s conscience has been shocked by reports of more than 80,000 corporations crowded into office tenements under the most deplorable conditions.
Teams of housing inspectors scoured the financial district, motivated by a concern for the safety of the teeming hordes of immigrant corporations who have fled here, seeking shelter from taxes at home. Confronted with this mass migration, the Caymans are struggling to house the refugee firms, which vastly outnumber the islands 55,000 human residents.
One of the inspectors, speaking anonymously because he has not been authorized to discuss his work publicly, described the office tenements as “worse than anything I’ve ever seen.”
“We found 18,857 corporations crowded into a single five-story building,” he recalled with a shudder, his eyes closed as if to shield himself from memories of the wretched scene. “There were hundreds of them living in a single file cabinet. Corporations were sleeping in their own feces. The place was crawling with vermin.”
“We have helped them launder their money,” he said, “but in other ways sanitation is non-existent.”
A member of the Caymanian Legislative Assembly, speaking yesterday on the floor of the chamber, said “It’s a scandal, in a land as rich as the Caymans, to have immigrant corporations packed into offices that are nothing more than glorified warehouses. We can no longer turn a blind eye to their welfare; this report is a wake-up call to our territory’s conscience. We give these firms glowing titles like ‘corporate subsidiaries,’ but in reality they exist only as a few sheets of notarized paper, stuffed into a manila file folder, going year after year without seeing a single soul.”
“Overcrowding of the kind that has been discovered is a disaster waiting to happen,” he declared. He termed it “an affront to humanity” that these legal fictions were subjected to such minimal living conditions, and proposed strict new limits on how many corporations could be filed in a single drawer as well as how many could be housed under one roof.
An earlier proposal would have required each corporate headquarters be allotted at least one square foot for itself, but it drew little support and was withdrawn. Opponents derided the measure as “regulatory overkill” and “a colossal waste of space,” pointing out that none of the headquarters had personnel, furnishings, equipment, or supplies on the Islands.
Despite their squalid quarters, the corporations--which include banks, hedge funds, structured financing, investment firms, captive insurers, and offshore law practices--were described as looking “fat and well-fed.”
The CEOs of numerous U.S. firms, already struggling to fix their own nation’s debt by persuading Congress to slash Social Security, Medicare, environmental efforts, and other programs devoted to the common good, have nevertheless vowed to help fix the Caymans’ housing crisis as well.
Their motive, a spokesperson admitted, is “not entirely altruistic,” as 83 of the top 100 publicly traded U.S. corporations have subsidiaries in the Caymans or other tax havens.
The Caymans have no annual reporting, accounting, or auditing requirements for companies incorporated there, and the Caymans’ government provides a 30-year guarantee of no corporate taxes, no capital gains taxes, no payroll taxes, no property taxes, and no withholding taxes.
© Tony Russell, 2013