4:01 pm in Uncategorized by GREYDOG
By Iddhis Bing, 99GetSmart
A GIGANTIC FUNNEL IN LUXEMBOURG
Invisible Money 4
At the end of Invisible Money 3, the ink was drying on the latest tax evasion scheme in Marius Kohl’s office at 18, rue du Fort Wedell in Luxembourg’s capital. Kohl, head of the tax bureau at Sociétés 6, was formalizing the tax deal for the world’s third largest pharmaceutical company, GlaxoSmithKline. He and the Bureau d’Impots are happy to provide fast service for an untold number of companies – Amazon, Google, The Guardian (yes, that Guardian, through the Eden Company), iTunes, Procter & Gamble among them. His is a busy trade and still very much ongoing in luxurious Luxembourg, which profits from structural loopholes in antiquated European tax law. 40,000 pages of such instances give some hint of how widespread the tax avoidance business is.
Marius Kohl is the head of a department in a small government apparatus dedicated to tax affairs. But he is not the man who sets the policy. He has bosses above him who do that, persons readers will soon know more about. Because if Marius Kohl ever deviated from considered policy, if his actions were at variance from his superiors’ dictats, Marius Kohl would be gone at the end of the day, whether he approved a new set of origami organizations or not.
Let’s freeze Marius Kohl with his pen an instant away from signing on to yet another fictive, intracompany entity. We’ll leave him right where he is, while we turn around to take a quick look at the landscape in which Luxembourg operates, a landscape which makes Luxembourg possible.
It has been a busy month or so in politics and on the tax/debt front. Are the two inextricably linked? Of course they are. “The fact that many men are occupied in making clothes for one individual is the reason so many others go without.” Does that make sense?
In Athens in October, protesters greeted Angela Merkel with a banner in front of Parliament that read “Angela weine nicht. Da ist nichts im Shrank, was zu holen wäre” – “Don’t cry, Angela. There’s nothing left in the cupboard for you to take.” The line is originally Bertolt Brecht’s.
Is Chancellor Merkel the uncrowned Queen of Europe? Europeans might be forgiven for thinking she is. So when Ulrich Beck, a German sociologist, published an article last week depicting Merkel as a devoted student of Machiavelli, it was widely read across the continent and gave rise to a new moniker for Germany’s leader: Merkiavelli. The empress has a new set of clothes.
Beck argues that Merkel must walk the fine line between being loved at home – enough to be reëlected – and loathed outside Germany – but not so loathed as to be detested and lose her preëminence. “Merkiavelli’s power rests upon the desire to do nothing, her penchant for avoiding action, acting later, hesitating. This art of selective delay, a mixture of indifference, a refusal of Europe and European engagement, is the source of Germany’s powerful position in a continent stumbling through the crisis.”
“Madame Merkel prefers – and this is the full Machiavellian irony of her position – to make the willingness of Germany to provide assistance to indebted countries dependent upon their acceptance of the German policy of stability.”
“Politically, inside Germany the Chancellor reassures Germans, who fear for their retirement, their little house and their economic miracle, and with a very Protestant rigor she defends the politics of No in measured doses, all so that she gives the appearance of being the one instructor at school capable of teaching Europe a lesson.”
“The more Germans become critical with respect to Europe, the more they feel encircled by countries peopled with debtors who only want to get their hands into German wallets, the more difficult it will be to maintain her two positions.”
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