Laura Poitras, Academy Award winning Director of Citizenfourand others at Field of Vision stitched together 200000 Google satellite images to create Best of Luck with the Wall, a video of the US-Mexico border, where the American government proposes to build a wall to keep out Mexicans.
Trump has emphasized the bilateral in his thinking and approach. This is in contrast to the multilateral world of the globalization era that is now at an end. This includes an end to multilateral trade in favour of a network of focused bilateral economic interactions. As a thought experiment, imagine that a Trump United States seeks to align itself strategically with other powers, ie. with Russia, even against the interests of its citizens (henceforth expendable in the interests of a monarchic state) or past allies (inconvenient obligations). In this vision, the US and Russia would be economically similar, as highly divided countries, rigidly ruled.
A US-Russia partition of global interests would be echoed regionally, suggesting balanced tensions between proxies in each arena that dominate international interactions, for example Israel-Syria in the Middle East. Such states would seek to profit as not only proxies but champions for their respective sponsors in each competition.
However, what of China faced with this bilateral duopoly? There are opportunities to innovate. Perhaps China is the banker of this dialectic? Closer China-India ties be a better strategy for both as it may lay the basis for a future, post-carbon economic bloc. India is otherwise too weak to influence the course of events.
As for Europe, it is now retired from the geopolitical stage as it is too internally divided. 2017 thus also marks the end of the long-duree of European colonialism. The peripheral states produced by European empires as suppliers of raw materials, whether Australia, South Africa, Congo, Algeria, Brazil or Canada, become more unstable because tied to one of the duopolistic major players and held captive to what they are willing to pay.
Bilateralism would suggest rather different international institutions. It certainly is not neoliberalism with its corresponding international institutions. Promoting a reduction to market logics seem to have destroyed civility, allowing tyranny to take root.
If such a thought experiment were to be realized, it would entail a massive forgetting of the 20th century and the lessons of the recent past.
In today’s world of off-shore tax havens,i quantitative easing,ii high frequency trading,iii and rampant global asset and real estate speculation it seems that a sort of gamified monetary space-race is going on and that it’s advancing with increasing speed. This monetary space-race game is one that is partially defined by both off-shoring and “on-shoring,” by both making assets disappear behind the legal shrouds provided by nation states that profit by providing secrecy to wealthy international clients and conglomerates, and by making virtual assets material in the form of, for example, international real-estate speculation.
But this immaterial/material financial binary is not adequate if we are to identify more comprehensively the space and spaces – the game dynamics – being put to work in service of global finance capital. For example, as but one expression of this monetary space-race, the recent tax haven scandals surrounding Panama’s Mossack Fonseca (which after two weeks of headlines is barely discussed anymore) is not so much about securing or profiting from locating capital in distant geographical spaces – tax-free islands, sandy beaches, and sun-drenched shell-company postal boxes, as it is about taking advantage of new and emerging forms of: 1) interstitial temporal spaces; 2) immaterial or undetectable digital spaces; and / or 3) invisible spaces that, as far as the public is aware, simply do not exist. That is, despite superficial appearances, the new monetary space-race is less about physically off-shoring capital and currency, than it is about staying ahead of the embittered and comparatively impoverished masses and the increasingly indebted governments ever more desperate for funds by hiding, or making invisible, digital money that’s been stored in “the cloud,” on the internet, or on an array of hard-drives. In other words, generating financial distance between wealth and the tax-hungry governments who would love access to it is not achieved through the separation offered by geographical space, but through the creation of new spaces, non-spaces, unknowable spaces that may or may not be physically located in a data-centre or business park next to you in Canada, London, New York,iv or Delaware.v
A layered global spatialization divides the world not just into haves and have-nots, but between a tax-avoiding elite that operate in the flows of a worldwide financescape of tax havens and economic free trade zones and “the rest” bound by taxes in outflanked territorial states.
The geography of the space of flows is distinguished by island tax havens: in the Caribbean, Bermuda, Panama, The Seychelles, the Channel Islands and Isle of Man for which Switzerland and its banks may be a global command and control centre.
The geography of offshore tax havens reflects the spirits of hoarding, self-enrichment, expropriation and mean-spiritedness. The leak of Mossack Fonseca’s archive via the ICIJ International Consortium of Investigative Journalists, a project of the US Centre for Public Integrity, reveals the identity of individuals and families that have cached away wealth to avoid taxation by national governments. As The Guardian put it today,
what has broken out of the vaults of the offshore legal specialists is “the sense that normal rules do not apply to the global elite. In a new gilded age, taxes would – once again – appear to be for the little people…. Slowly but surely… the world has learned that the banks that busted the global economy were also consumed with … rigging rates, ripping off customers and laundering Mexican drug money.” It reveals the “tax-dodging lengths that private wealth will go to in order to keep public coffers empty.”
The amount avoided in taxes would solve many countries budget deficits. Budget deficits are debts piled on to our children by tax avoiders. The temporal aspects, in which money made in the past is inherited tax free in the present, taxes not paid in the present then lead to debt by others in the future, make this a distinct topology. Its like the elite and the rest live on different financial planes. These two worlds, two planetary financescapes, have points of intersection but otherwise conceived as independent. The reality however is that the elite are living in a virtual reality, of course, and usually find out to their cost that they are dependent on the acquiescence of the many to this situation. Social consent can easily by withdrawn.
Countries less able to monitor financial industries and collect taxes are particularly vulnerable, as the map create by Offshore Net suggests. USD21 trillion was their 2010 estimate.
A study of the American top 100 publicly traded companies by U.S.PIRG, as measured by revenue, shows 82 maintain subsidiaries in offshore tax havens. Collectively, the companies report holding nearly $1.2 trillion offshore, with 15 accounting for two-thirds of this (see diagram).
“When corporations use tax havens to dodge the taxes they owe, the rest of us pay the price, either through higher taxes, cuts to important programs, or a bigger deficit,” said Dan Smith, U.S. PIRG Tax and Budget Advocate and report author. “It also puts small businesses without expensive tax attorneys at a big competitive disadvantage” (Offshore Shell Games).
To these sites, one can add free trade economic zones that are tax free so that companies are not taxed on the value added to products in these zones that are way-points between producers and consumers. Olivier provides one of the always excellent maps from the Le Monde Diplomatiquearchived on World Resources SIM Centre: