Saturday, February 13, 2010

European summit on bank secrecy looks like more empty rhetoric

All the talk in Europe about ending decades of bizarre bank secrecy rules aimed at protecting trillions of dollars hoarded by the world's richest families is only that -- more talk. Sunday's international conference in Luxembourg is designed to create the impression of progress, even though the holders of all that wealth have no intention of being exposed nor of paying taxes on more than a tiny portion of it. The conference brings together the finance ministers of Switzerland, the world's leader in secret offshore accounts, and Luxembourg and Austria, the European Union secrecy leaders, according to the Reuters international news service. Ministers from Lichtenstein, a longtime money secrecy haven that recently embraced transparency, and Germany also are expected to attend. "This meeting will chiefly be about tax evasion and how to tackle it cross-border," a person with knowledge of the agenda told Reuters. "It will be about bank secrecy, but there is no common position as yet." Germany has joined with the United States in efforts to crack the bank secrecy wall to increase government tax receipts. Of course, it would be a lot more reassuring if the countries could agree on bank transparency because it's the proper thing to do, and regard the increased tax collections as a secondary -- although substantial -- benefit. If ordinary people have to pay taxes every year on their holdings, why should the super-rich be able to hide behind archaic secrecy rules to escape their share? They are, after all, the largest beneficiaries of laws and traditions protecting private ownership. Then again, doing away with these secrecy regimes will by implication peel away the senseless protection enjoyed by the perpetrators of one of modern society's greatest evils -- the confiscation of wealth from countries all over the world by the Nazis in World War II. Until the banks are willing or are forced to reveal what happened to all of that wealth -- or, if it's gone, who made off with it -- protestations about reining in secrecy laws won't amount to anything worthwhile.

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