The Panama Papers and why we should care

by Aulani Capuchin, Contributor

If you haven’t started paying attention to the Panama Papers issue yet – you should.

Early this month, roughly two terabytes of information involving Mossack Fonseca, a Panamanian law firm, leaked. This information revealed a network of offshore accounts and shell companies for various types of the world’s elites, including world leaders and politicians.

The purpose of these accounts and companies is to make the tracing of fund allocation difficult, or rather easily concealed until heavily investigated, which is also known as money laundering.

Money laundering can be used for various purposes, including tax evasion and purchase concealment. The latter of the two can branch in a large variety of ways, for example, one government official paying off another.

Tax evasion, when put into perspective for large corporations, can mean millions of dollars that aren’t being paid by these companies that still have to come from somewhere (the pockets of citizens).

It is the responsibility of not just tax bureaucracies around the world, but the population of the countries involved to hold their leaders and delegates alike accountable for their fiscal activity. When it comes to shady government behavior, or behavior involving large players of the global economy in general, really, informing the public can come with a lot of hurdles.

The more uninformed the public is, the slimmer the likelihood of action becomes, subsequently allowing said activity to continue.

Only if the public pushes the use of various resources to crack down on this problem will something truly significant will be done. In foreign countries, their leaders are blatantly using Internet censorship to refrain from exactly this.

Another thing to take into consideration as important is proactivity. Pfizer and Allergan, two large pharmaceutical companies, were considering a merger until tax laws tightened in the U.S. as a result of the Panama Papers.

This can be a huge red flag as to the kind of financial benefits mergers have provided corporations in the past, though it has been seemingly avoided this time around.

That being said, for that to be effective in a democracy, once again the support of the people is something that is a crucial necessity behind any sort of potential legislation.

It is a privilege to be able to be part of things that could potentially solve varieties of problems, and as citizens we shouldn’t forget that.