Missionary Renegade: Democracy Now! Daily Digest: A Daily Independent Global News Hour with Amy Goodman & Juan González for Tuesday, November 3, 2015

Sunday, November 15, 2015

Democracy Now! Daily Digest: A Daily Independent Global News Hour with Amy Goodman & Juan González for Tuesday, November 3, 2015

Democracy Now! Daily Digest: A Daily Independent Global News Hour with Amy Goodman & Juan González for Tuesday, November 3, 2015
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Have Protests Killed the Keystone XL? TransCanada Asks U.S. for Delay in Face of Likely Rejection

The corporation behind the Keystone XL oil pipeline has asked the Obama administration to suspend its long-running review of the controversial project. On Monday, TransCanada told the State Department it wants to wait until Nebraska, a state along the pipeline’s route, gives its approval. If the delay is granted, the decision on Keystone XL would be pushed until after the 2016 election—and possibly handed to President Obama’s successor. That’s led many to speculate TransCanada is throwing a Hail Mary in the hopes the next White House occupant is a Republican. We are joined by Bill McKibben, co-founder of 350.org, an environmental group that has helped lead the multi-year grassroots campaign against the Keystone XL. "In the end, this was never really about the power of the administration," McKibben says. "This was about the power of organized people to come together and change the script—and that’s what’s happened here."

TRANSCRIPT

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: The corporation behind the Keystone XL oil pipeline has asked the Obama administration to suspend its long-running review of the controversial project. On Monday, TransCanada told the State Department it wants to wait until Nebraska, a state along the pipeline’s route, gives its approval. But critics say TransCanada is trying to buy time until President Obama leaves office. After multiple delays, Obama has promised to decide on Keystone before the end of his second term.

The project has emerged as a political flashpoint, with defenders calling it a boost to the economy and opponents warning of a devastating impact on the planet. The proposed pipeline would transport 830,000 barrels of crude every day from Alberta’s oil sands to refineries on the U.S. Gulf Coast for export. In a 2013 speech, President Obama said his decision will turn on assuring it does not significantly exacerbate the problem of carbon pollution. Since then, there’s been growing speculation Obama will ultimately reject Keystone XL. The pipeline has faced years of sustained protests from groups including indigenous communities, environmentalists and land owners along its route.

It’s unclear now if the administration will grant TransCanada its delay. If it does, the decision on Keystone XL would be pushed until after the 2016 election and possibly handed President Obama’s successor. That’s led many to speculate TransCanada is throwing a Hail Mary in the hopes the next White House occupant is a Republican.

For more, we’re joined by Bill McKibben, co-founder of 350.org, the environmental group that helped lead the protest against the Keystone XL, has helped organize major protests against the pipeline outside the White House, including a historic act of civil disobedience in August of 2011 when he and more than 1,200 others were arrested.

Bill, welcome back to Democracy Now! Talk about the significance of TransCanada saying they want to pull back their request for a permit from the State Department.

BILL McKIBBEN: Hey, Amy. Well, look, a remarkable moment, really. Since you were one of the few reporters covering this story early on, you’ll remember that in 2011 TransCanada was so confident of victory that they mowed the route of the entire pipeline, planning to begin construction within weeks. It was a done deal, and it’s been becoming spectacularly undone ever since. This was kind of the final tossing in of the towel from TransCanada. They know that they can’t get approval out of the Obama administration, so they want to avoid the ignominy of actually being outright rejected. In literal terms, it probably doesn’t make much difference. If a Republican gets elected, they can just restart the whole thing and, you know, call it something else—the Triple Happiness for American Patriots pipeline or something—and get going all over again.

This is a remarkable victory for the remarkable coalition, led by indigenous people, farmers and ranchers, climate scientists, faith communities. And the good news, really, above all, about it is that it’s a victory not confined to this particular pipeline. A couple of weeks ago, the head of one of the big fossil fuel industry trade groups gave a speech in which he said to his colleagues, "We simply have to figure out a way to stop the Keystonization of every fossil fuel project." Around the world now, there is not a single major fossil fuel project that does not meet with resistance of some kind, and increasingly that resistance is successful. Keystone was one of the birthplaces of that resistance. And though we continue to want the president to give it the official no, the fact that TransCanada has given up is—well, it was a good night last night.

AMY GOODMAN: Now, they didn’t just end their—TransCanada didn’t just say they’re ending the pipeline. They want a delay in the permit process.

BILL McKIBBEN: They want the—so they want the State Department to grant them a time-out for the next couple of years. And then they’ll start—

AMY GOODMAN: They say to get Nebraska’s approval for the route.

BILL McKIBBEN: Yeah, yeah. I mean, obviously, all they want is a different president. And even if the president does what he should do and rejects the pipeline outright now, they’ll still be able to start again with a new president, should we be unwise enough to elect one of their favorite candidates. What would be good would be for the president to forthrightly deny the pipeline, mostly because it would then allow him to go off to this Paris climate conference with some real credibility as the first world leader to have stopped a big fossil fuel project because of its effect on climate.

But as far as this pipeline getting built, think about it. A done deal in 2011; now, at least through 2017, there’s no pipeline. People, coming together, have stopped for six years 800,000 barrels a day of the dirtiest oil on Earth from getting out of the ground. In the course of doing that, they’ve made life almost impossible for the big companies up in the tar sands, who have withdrawn tens of billions of dollars’ worth of capital from expansion projects. This is one of the great environmental victories in decades. And as I say, the reason it’s so important is because it’s the gift that keeps on giving. It gives us all faith that we can keep mounting these kind of battles, as long as we display the same kind of unity and purpose that we displayed here.

AMY GOODMAN: Could the State Department just ignore the request for a delay or turn it down, and President Obama—

BILL McKIBBEN: Sure.

AMY GOODMAN: —just turn down the Keystone XL?

BILL McKIBBEN: Sure. The State Department should just say, "No. You know what? You don’t really get to ask for extra innings when you’re behind at the end of nine." We’ve already said that the way we’re going to make this decision—this is what Obama and the State Department have said—are on climate grounds, not on the grounds of the route through Nebraska. Clearly, the route through Nebraska isn’t going to change the amount of carbon this thing pours into the atmosphere. So they’re well within their rights—in fact, they obviously should simply say no. Who knows whether they’ll have the courage to do that or not. We’ll continue to ask them to. 350.org, many other groups sent out letters last night asking people to remind the administration that they still have a role to play here. But let’s be serious. In the end, this was never really about the power of the administration. This was about the power of organized people to come together and change the script—and that’s what’s happened here.

AMY GOODMAN: Bill McKibben, I want to thank you for being with us, speaking to us from his home in Vermont. Bill McKibben is co-founder of 350.org.

This is Democracy Now! When we come back, why are hundreds of thousands of people who signed up for health insurance scrambling now because their healthcare insurance companies, actually co-ops, are going under? Stay with us.

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The Co-ops Collapse: How GOP & HMOs Undercut Obamacare's Nonprofit Option, Leaving 500K Uninsured

As the Obamacare open enrollment period begins, it’s the end for many healthcare co-ops, leaving hundreds of thousands of people scrambling to find coverage. The co-ops were founded to offer a cheaper alternative on insurance exchanges after Democrats stopped demanding a public option. But since going live three years ago, the co-ops have faced major cutbacks from the Republican-controlled Congress. Now the system is faltering, with at least eight health insurance co-ops shutting down. The co-op closures have left some 500,000 people without insurance—and a marketplace of fewer choices and higher prices. It’s the kind of scenario that advocates of a single-payer system warned about from the outset: With Obamacare relying on for-profit insurance companies to provide coverage, the market will find a way to squeeze out those who need it most. We are joined by three guests: physician, professor and single-payer advocate Dr. Steffie Woolhandler; Wendell Potter, a former insurance executive turned whistleblower; and Julia Hutchins, chief executive officer of Colorado HealthOP, a consumer-directed, nonprofit health cooperative in Colorado that was forced to shut down last month.

TRANSCRIPT

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: Open enrollment has begun in the health exchanges created under the Affordable Care Act for uninsured Americans. But this year, many shopping for coverage find themselves without their most affordable choice: independent, nonprofit cooperatives. The co-ops were founded to offer a cheaper alternative after Democrats stopped demanding a public option. But since going live three years ago, the co-ops have faced major cutbacks from the Republican-controlled Congress. The GOP has slashed funding by more than half and stopped the Obama administration from helping offset the unexpected high costs of covering sicker beneficiaries.

Now the system is faltering, with at least eight health insurance co-ops shutting down. A turning point came last month when all exchange providers were told the federal government would only pay them a small percentage of what they were expecting. The co-op closures have left some 500,000 people without insurance—and a marketplace of fewer choices and higher prices. It’s the kind of scenario that advocates of a single-payer system warned about from the outset: With Obamacare relying on for-profit insurance companies to provide coverage, the market will find a way to squeeze out those who need it most.

For more, we’re joined by three guests. Dr. Steffie Woolhandler is with us in New York, primary care physician, professor at the CUNY School of Public Health at Hunter College, co-founder of Physicians for a National Health Program, where she’s been a vocal advocate for single payer.

Wendell Potter also joins us in Philadelphia, a former insurance executive turned whistleblower and senior analyst on healthcare at the Center for Public Integrity.

And we go to Denver to Julia Hutchins, chief executive officer of Colorado HealthOP, a consumer-directed, nonprofit health cooperative in Colorado. Last month, state regulators forced Colorado HealthOP to shut down, saying it isn’t in strong-enough financial shape to pay out its members’ claims. Colorado HealthOP tried to challenge the closure but was denied.

We welcome you all to Democracy Now! Steffie Woolhandler, let’s begin with you. In New York, there are well over 200,000 people who are—have insurance under what’s called Health Republic, one of these healthcare co-ops. Suddenly, last Friday, to the shock of many—even people working within the system—they were told that this healthcare co-op will close by the end of the month. That’s November. That’s before you can even get coverage in this open enrollment period. The next time is January 1st. So they have to sign up twice—right now, to fill the gap to the end of December, and then, because of IT issues—they can’t just sign up now and get that insurance from now on in another company—they have to sign up now ’til the end of December, and sign up within the open enrollment period, like a day later, for getting insurance in January. Over 200,000 people are out of insurance.

DR. STEFFIE WOOLHANDLER: Yes.

AMY GOODMAN: Just in New York alone.

DR. STEFFIE WOOLHANDLER: Just in New York. And 10 of the 23 co-ops have closed, and several more are expected to close soon. These nonprofit co-ops, many of us felt they were never going to be viable. These tiny insurance co-ops was like the peewee football going against the NFL. They just didn’t have the size to make it in the marketplace.

But also, they weren’t cheaters. And the way the health insurance market works is good guys finish last, and cheaters win. The way you make a killing in the health insurance market is by signing up lots of healthy people, collecting as high premiums as possible and giving them as little care as possible—and, if they get sick, figuring out ways to force them out of the insurance. That’s the way the U.S. insurance market works. And these small nonprofit co-ops were not very good at playing the game. Many of them didn’t want to play that game.

So, we’re not surprised they went under. You know, the only way to insure a population, that has worked, is through some form of nonprofit national health insurance. That’s what every other developed nation uses. And then you have everybody in what we call the same risk pool—everyone in, nobody out.

AMY GOODMAN: We’ll talk about single payer in a moment. But, Wendell Potter, can you go back to when the Affordable Care Act was being debated and what was promised and what you said at the time? Now, you worked in several insurance companies. You worked, what, for Aetna—you were a top executive—as well as?

WENDELL POTTER: Humana and Cigna.

AMY GOODMAN: Mm-hmm, so Humana, Cigna, Aetna. Talk about what you were saying then. You were a whistleblower back in 2009.

WENDELL POTTER: Yeah. What I saw was that the—as you may remember, the public option was being proposed and had quite a bit of support in Congress. But over in the Senate, in the Senate Finance Committee in particular, Max Baucus, who was chairing the committee at the time, put together what came to be called the Gang of Six—three Republicans and three Democrats that he handpicked. He chaired this little group, with the idea, the hope, that some bipartisan legislations—some bipartisan reform legislation could be crafted and passed. It was a fool’s errand from the beginning, obviously. But out of that, Senator Kent Conrad, a Democrat of North Dakota, proposed that instead of the public option, Congress should authorize funding to create these co-ops.

And I wrote at the time that it would be great if that could—if we had a world in which those co-ops could succeed, but it was just sheer folly to think—and fantasy, to think that that could actually happen. And it’s because of largely what Steffie said: They would have to compete with these very, very large for-profit insurance companies, like the ones that I used to work for. I know what the barriers to entry—and in any market in this country, what those barriers are. They’re very, very high. And unless you have incredible capitalization, they’re just not going to succeed. I told—I testified before a Senate panel—a congressional panel, just a few weeks after that, that if Congress passed legislation without a public option, that they might as well call what they ultimately passed the Health Insurance Profit Protection and Enhancement Act.

And, Amy, that’s exactly what has happened. Since the Affordable Care Act went into effect, the for-profit insurance companies have thrived. Their stock prices more than tripled, and in some cases quadrupled, while the co-ops have been starved of funding, have not been able to overcome those barriers. And as we know, many of them are closing and leaving a lot of people in the lurch.

AMY GOODMAN: Julia Hutchins, you’re the CEO of the Colorado HealthOP. Tell us how many people you served, when you were established and what happened in the last period.

JULIA HUTCHINS: We were established through this program, the co-op program under the Affordable Care Act. And we still today serve 80,000 Coloradans through the end of the year.

AMY GOODMAN: So tell us what happened.

JULIA HUTCHINS: It was the story—maybe it’s an old story of politics and fear. Certainly, the program, part of a bipartisan compromise, it may be one of the only programs in the Affordable Care Act that really addressed competition and the need to make health insurance affordable for people. We talk a lot about access to care, but access to care is so connected to cost. So we’re a program—from the beginning, if the rules had stayed the same, which they never do, we’d still be here. But through continued cuts by Congress and then, really, at the end—I mean, where was Obama? Where is Obama now? At a time when the big insurance companies are getting bigger, what this country needs is solutions that keep healthcare local and that really engage people in their own healthcare and provide options for personalized care. And the co-op program is still around. And really, while it lost—though it was politically orphaned in the process, it still is a strong foundation to build from.

AMY GOODMAN: So, what do people do? How do you get in touch with them to tell them that their health insurance has ended? Is it possible they’ll miss it?

JULIA HUTCHINS: It is. And we’ve done everything we can. We’ve been very, very vocal. And even before we closed, we—all our members were up in arms. We had over 500 people write to Congress in one day, and have been doing everything we can to make sure people know. We do worry about, as it gets closer to the end of the year, that there are people who are in the hospital or in treatment programs, and that they’re focused on her health and not their health insurance. And a lot of our efforts, as we close out the year, are making sure we find those people and help them transition to something else and help them keep coverage. I mean, that was one of the beautiful things about the co-op program, regardless of where we sit today, is that we were the ones hitting the streets and talking about the value of coverage and getting people insured. And in some ways, we were a very cheap way to be able to do that.

AMY GOODMAN: Dr. Steffie Woolhandler, you’re smiling as you hear that.

DR. STEFFIE WOOLHANDLER: Well, I think we are going to need a national financing system. We can certainly have a local control of healthcare. In fact, a national financing system would give people their free choice of doctors or hospitals, which facilitates local control. But I do think we’re going to need that single-payer, nationally based financing to make this work.

AMY GOODMAN: Do you see that at all happening? And this goes to the issue of single payer. Where is the state of the movement today? You have the Republicans attacking Obamacare, saying they’d like to see it end. It’s one of their number one issues, though they’ve let go a little bit, saying it’s unrealistic, as millions more people have been insured and the healthcare system is now completely—revolves around the Affordable Care Act.

DR. STEFFIE WOOLHANDLER: Yeah, well, the Affordable Care Act is the new status quo, and it’s completely inadequate. We’ve still got 33 million people uninsured. Even when we’re fully implemented with the Affordable Care Act, we’re going to have 25 million uninsured. That’s just unacceptable. And then tens of millions more are getting these plans that are really underinsurance, with huge copayments and deductibles, meaning they pay for the insurance and they still can’t afford care. So we still need to be working for single payer, which is the only thing that can really provide everybody with affordable coverage.

I was just at the national meeting of Physicians for a National Health Program. We had hundreds and hundreds of people in Chicago. The students were there. They formed 52 new medical school chapters of Physicians for a National Health Program in the last year. There was a large Healthcare-NOW! meeting, which is the non-physician organization. It was sponsored by the steelworkers’ union and the national nurses’ union, with hundreds of non-physician activists. They are committed to single payer. So, we know we have a ways to go, but we’re on our way to really building the movement that will get Americans the single-payer health system that they deserve.

You know, single payer works because you save $400 billion a year in administrative costs, and you can take that money and improve care for everyone. And that’s what we need.

AMY GOODMAN: In December 2009, during the debate over the Affordable Care Act, Vermont Senator—now presidential candidate—Bernie Sanders advocated for a single-payer system. This is what he said.

SEN. BERNIE SANDERS: What’s the answer? Well, I don’t think anyone has a perfect answer, but I do think that the United States should be looking at other countries around the world. Why do we end up spending so much and get relatively poor value for what we are spending? And I think when we do that, when we look at countries throughout Europe, Scandinavia, Canada and so forth, I think it leads one to the conclusion that if we are serious about providing quality, affordable care to all Americans in a cost-effective way, then we must move toward what many of us call a Medicare-for-all, single-payer program. Now, I understand, as I think many people do, that because of the power of the insurance companies and the drug companies and the medical equipment suppliers, because of their campaign contributions, because of their lobbying, the truth of the matter is that a single-payer program has never been on the table from day one, since this whole discussion began. And I think that that is very, very unfortunate.

AMY GOODMAN: Now, that’s a Democratic presidential candidate, Bernie Sanders. Republican presidential candidate Donald Trump also spoke about how he supports a single-payer healthcare.

DONALD TRUMP: As far as single payer, it works in Canada. It works incredibly well in Scotland. It could have worked in a different age, which is the age you’re talking about here. What I’d like to see is a private system without the artificial lines around every state. I have a big company with thousands and thousands of employees. And if I’m negotiating in New York or in New Jersey or in California, I have like one bidder. Nobody can bid. You know why? Because the insurance companies are making a fortune, because they have control of the politicians—of course, with the exception of the politicians on this stage. But they have total control of the politicians. They’re making a fortune. Get rid of the artificial lines, and you will have yourself great plans. And then we have to take care of the people that can’t take care of themselves. And I will do that through a different system.

BRET BAIER: Mr. Trump, hold on one second.

SEN. RAND PAUL: Hey, Bret, Bret, I’ve got a—I’ve got a news flash.

BRET BAIER: I know, hold on, Senator Paul.

SEN. RAND PAUL: News flash: The Republican Party’s been fighting against a single-payer system—

BRET BAIER: OK.

SEN. RAND PAUL: —for a decade. So I think you’re on the wrong side of this if you’re still arguing for a single-payer system.

DONALD TRUMP: I’m not—I’m not—I don’t think you heard me. You’re having a hard time tonight.

BRET BAIER: All right.

AMY GOODMAN: That was Donald Trump and a little bit of Rand Paul there, Donald Trump in the first Fox presidential debate, and before that, Bernie Sanders. Your response to this, Wendell Potter?

WENDELL POTTER: Well, I think Senator Sanders is exactly right. And it’s such a shame that Congress did not give serious consideration to single payer when it began debate on healthcare reform. And he’s right, too, we should have looked at what works in other countries. But we didn’t. We only looked at what we currently have. And as Uwe Reinhardt, a health policy expert, has called it, the Affordable Care Act is, in many cases, an ugly Band-Aid on an ugly system. And it’s not a system that can be sustained.

Donald Trump made a very good point that other countries really like their single-payer systems. And in those countries, they spend far less on healthcare, and their outcomes are much better than ours in this country. And there’s no reason to think that the era has passed that we can’t do that in this country.

I think what you’re going to be seeing is that not just individuals and physicians are going to be becoming less and less enchanted with their healthcare system, but I think you’re going to see business leaders become more and more disenchanted, as well, too. The Affordable Care Act has done some good. It’s reformed—it put some insurance reforms in place and has brought some people into coverage. But again, as Stephanie said, many of those people now are underinsured, and it has not done very much at all to control cost. And the private insurance companies—this is where I think business leaders are finally going to start catching on. Private insurance companies cannot control cost. If they could, we would not be in this situation we are now. So I think that we will start seeing a broader coalition of people coming together to support single payer in the months and years ahead.

AMY GOODMAN: Julia Hutchins, do you feel that the private insurance industry worked together to try to get your co-op and the other co-ops across the country defunded?

JULIA HUTCHINS: Absolutely. In some ways, we were so heads down, doing the right thing for our members, and a populist movement at its core, we really underestimated how threatening we were to the existing players in the healthcare system. And this country needs something that works for people and for physicians. And that’s what healthcare care is about. It’s about that patient-physician relationship, and we’re getting farther and farther away from that through big health insurance companies. We don’t need mass-produced healthcare. We need it to be local and personalized.

AMY GOODMAN: You know, we heard that in New York this massive healthcare co-op, Health Republic, which serves over 200,000 people, would be closing at the end of the year. Then suddenly, last Friday, they announced, no, it will be at the end of the month, which leaves people to sign up twice. Now, who benefits from this? Why leave 200,000 people out in the lurch? Is it the providers that put pressure, fearing that they would get, what, 50 cents on the dollar, or whatever, so the hospitals and the doctors say, "No, we want to be paid, so they will be shortchanged, the patients"? Is this a matter of organizing and grassroots activism?

DR. STEFFIE WOOLHANDLER: OK. Well, an insurance company needs large reserves to do its job, and the state regulators came in and said, "You didn’t have enough reserves." The question is why they didn’t have enough reserves. And it’s twofold. First of all, these were the good guys, who were cooperative and were trying to enroll people and provide them with the care they needed. And that’s why they were spending more money. That’s why they had low reserves. And the second thing is that Congress has repeatedly cut the funding to the co-ops, so that they started with lower reserves, and they got—they missed out on the subsidy that they had been promised to subsidize the care for high-cost patients. So, the regulators were just doing their job. You can’t run an insurance company without reserves. But the question is, you know, why the reserves were so low. And the fingerprints of the health insurance industry are all over this. They are some of the biggest lobbyists in Congress, along with the pharmaceutical industry, which also doesn’t want any sort of a public, nonprofit involvement in the healthcare system.

AMY GOODMAN: Wendell Potter, you talk about "the casino effect." What is that?

WENDELL POTTER: Well, the casino effect is, we, in this country, have to gamble on our lives and with our money. What we are forced to do in this country is, especially if we don’t get coverage through the workplace, of going through the exchanges to get coverage, and make some assumptions about how healthy we’re going to be in the coming 12 months. No one can really do that. You can’t predict if you’re going to come down with a serious disease or get badly injured. But a lot of people just think that they’re going to continue to have another year of good health, and so often they make very bad decisions. They make bad bets in this, what I call a casino of health insurance. And even if you do get coverage through the workplace, you’re often having to make the same decision, because even employers are pushing more and more of their workers into these high-deductible plans, with the promise that your premiums might not be as high as they otherwise would be, but you’re going to have to pay a lot more money out of your own pocket. And most people are just not able to predict, obviously, how much money they might need to spend on their healthcare. So, unfortunately, so many people are finding themselves now underinsured, and only find that out, frankly, when it’s too late. And in many cases, people who have insurance are still having to go to bankruptcy because of high medical debt.

AMY GOODMAN: We’re going to leave it there, but of course we’ll continue to cover this issue. I want to thank Dr. Steffie Woolhandler, primary care physician here in New York, professor in the CUNY system, City University of New York. Julia Hutchins, thanks for joining us from Denver Open Media, chief executive officer of Colorado HealthOP, which has just gone under. And thanks so much to Wendell Potter, former health insurance executive, author of Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR Is Killing Health Care and Deceiving Americans.

This is Democracy Now! When we come back, The Price We Pay. Stay with us.

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The Price We Pay: As U.S. Becomes a Top Tax Haven, How Hiding Wealth Offshore Robs the People at Home

When it comes to sheltering the wealth of the super-rich, the United States is moving up the ranks. A new study says the U.S. is now the third most secretive country for offshore finances, trailing only Hong Kong and Switzerland. While recent U.S. laws force banks and other firms to disclose the assets of American citizens, Washington has been criticized for failing to share that information with other countries. A 2012 study by the Tax Justice Network on the "offshore economy" estimated that wealthy individuals and their families have between $21 and $32 trillion of hidden financial assets around the world in offshore accounts or tax havens. The actual sums could be higher because the study only dealt with financial wealth deposited in bank and investment accounts, and not other assets such as property and yachts. The new documentary "The Price We Pay" tackles the issue of tax havens and their cost to the societies losing out on trillions of dollars in revenue. We are joined by the film’s director, Harold Crooks, and economist James Henry, senior adviser with the Tax Justice Network.

Watch Part 2

TRANSCRIPT

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: When it comes to sheltering the wealth of the super-rich, the United States is moving up the ranks. A new study says the U.S. is now the third most secretive country for offshore finances, trailing only Hong Kong and Switzerland. While recent U.S. laws force banks and other firms to disclose assets of American citizens, Washington has been criticized for failing to share that information with other countries. The Tax Justice Network says, quote, "Though the U.S. has been a pioneer in defending itself from foreign secrecy jurisdictions ... it provides little information in return to other countries, making it a formidable, harmful and irresponsible secrecy jurisdiction." A 2012 study on the offshore economy estimated wealthy individuals and their families have between $21 [trillion] and $32 trillion of hidden financial assets around the world in offshore accounts or tax havens. The actual sums could be higher, because the study only dealt with financial wealth deposited in bank and investment accounts, and not other assets such as property and yachts.

Well, a new documentary tackles the issue of tax havens and their cost to the societies losing out on trillions of dollars in revenue. The film is called The Price We Pay. This is the trailer.

SEN. CARL LEVIN: Does Apple Inc. own directly or indirectly AOI, AOE and ASI?

PHILLIP BULLOCK: Yes.

SEN. CARL LEVIN: And where is AOI a tax resident?

PHILLIP BULLOCK: It does not have a tax residency.

JAMES HENRY: You know, we’re talking about 10 to 15 percent of the world’s financial wealth basically being invested offshore beyond the reach of tax authorities.

JOHN CHRISTENSEN: So, far from being a success story, I regard the city of London as the world’s biggest tax haven.

CHUKA HARRISON UMUNNA: Can you tell me how many subsidiary companies of your group are incorporated and operating in the Cayman Islands?

NARRATION: Barclays Bank at U.K. Public Accounts Committee.

BOB DIAMOND: I don’t have that number with me, either.

CHUKA HARRISON UMUNNA: You have 181.

TIM RIDLEY: There are $1.6 trillion booked to Cayman Islands banks. Almost none of that is actually in Cayman.

STUART FRASER: Many politicians have an illusion that they actually run their country, when actually they run their country within the confines that the global financial system places on them.

ANGUS CAMERON: There was a period before we had a welfare state. We had the welfare state under a certain set of conditions, and those conditions have changed.

SASKIA SASSEN: The social contract is broken.

UNIDENTIFIED: People didn’t invest money into services. I mean, you look at the state of the roads here, the most basic thing, and there’s potholes everywhere. Property tax, they’re introducing, water tax—all these new taxes, personal taxes.

MATT BRITTIN: What’s different about Google, we’re not selling books, and we’re not making coffee.

MARGARET HODGE: You’re selling advertising.

MATT BRITTIN: Consumers are based on the computer science. That is what creates the economic value for Google.

MARGARET HODGE: What does Bermuda create?

JARON LANIER: Kodak had hundreds of thousands of employees—really good, solid, middle-class jobs. The new world of photography is Instagram, which had 13 employees and sold for a billion dollars to Facebook.

NICOLAS COLIN: [translated] Businesses die from this industrial revolution. They stop paying taxes, and the benefits move the tax havens.

SASKIA SASSEN: At some point, more inequality is not simply more inequality. It needs another name. People are being expelled from livelihoods.

PROTESTERS: We are the 99 percent! We are the 99 percent!

JEAN ROSS: People used to, in their positions, use that money, to invest in our country, to invest in people, and they’re not doing it anymore. And as a nurse, I would say they’re probably a little bit mentally ill. It’s not normal to want to hoard all that money. And the people in this country need it.

MATT BRITTIN: We pay all the tax you require us to pay in the U.K. We paid 6 million of tax last year.

MARGARET HODGE: Yeah, maybe. We’re not accusing you of being illegal. We’re accusing you of being immoral.

AMY GOODMAN: The trailer for the new documentary, The Price We Pay.

For more, we’re joined by two guests. Harold Crooks is the director of the film, and James Henry is an economist, lawyer, senior adviser with the Tax Justice Network, co-authored their 2012 study estimating up to $32 trillion in hidden offshore assets worldwide. He’s interviewed in the documentary, The Price We Pay.

Welcome, both, to Democracy Now!

HAROLD CROOKS: Thank you.

AMY GOODMAN: Harold, let’s begin with you, why you made this film.

HAROLD CROOKS: Well, I made the film—I was approached with the offer to make the film by a well-known Canadian producer, Nathalie Barton, who had been contacted by a Canadian fiscal expert, Brigitte Alepin, who had written a number of books on the imminent collapse of public finances in the Western world, and they asked me if I would be interested in taking on the project.

And after I thought about it a bit, I realized that the issue of taxation is actually a lens through which we understand power—who has it, who doesn’t and whether the average person has a hope in hell of getting ahead in life. And once I had that perspective on it, I was happy to take on the project.

AMY GOODMAN: I want to turn to another clip from your amazing film, The Price We Pay. During a British parliamentary hearing in 2012, Labour MP Chuka Harrison Umunna questioned Barclays CEO Bob Diamond about his company’s tax practices.

CHUKA HARRISON UMUNNA: Would you say that one of the ways companies meet their obligations to society is through the payment of tax? Yes or no?

BOB DIAMOND: I think payment of tax is an important responsibility of businesses, yes.

CHUKA HARRISON UMUNNA: Could you tell me how many subsidiary companies your group uses and that are incorporated in the Isle of Man?

BOB DIAMOND: I don’t have that number with me. I’d be happy to look into it and get back to you.

CHUKA HARRISON UMUNNA: Well, according to the return that your group company put in last year, you have 30 subsidiaries operating in that jurisdiction. Can you tell me how many subsidiary companies you have operating in Jersey?

BOB DIAMOND: I don’t have that number with me, either.

CHUKA HARRISON UMUNNA: The number is 38. Can you tell me how many subsidiary companies of your group are incorporated and operating in the Cayman Islands?

BOB DIAMOND: Same answer.

CHUKA HARRISON UMUNNA: You have 181. Now, of course, all of these are well-known tax havens, which are used by companies. And a cursory reading of your group return shows that you have over 300 such companies operating in tax haven jurisdictions around the world. You will understand, Mr. Diamond, that there’s obviously—I mean, if you look at the facts that I’ve just presented, that would suggest that your bank is engaged in tax avoidance on a grand scale, would it not?

BOB DIAMOND: Well, I don’t know what you—what—I think "tax evasion" is a very clear phrase. And it’s a space we would never go to.

CHUKA HARRISON UMUNNA: I know. And I didn’t use the word.

BOB DIAMOND: And I—I chose the word "tax efficiency," which is our obligation, and it’s something that is in line with government policy.

CHUKA HARRISON UMUNNA: Your "efficiency" may be our "avoidance."

AMY GOODMAN: That’s a British Labour MP, Chuka Harrison Umunna, questioning the Barclays CEO at the time, Bob Diamond, about Barclays’ tax practices. James Henry, you are the former chief economist at McKinsey & Company. Also, you are featured in this film. Talk about what they were just speaking about.

JAMES HENRY: Well, the multinational companies and banks make this point all the time about being legal. You know, that dodges the fact that a lot of this regulatory business when it comes to corporate tax is very complicated, that these companies are intimately involved in influencing the law, and that, essentially, the international corporate tax system has devolved to a situation where it’s a question of whether you can set up the right subsidiaries in Ireland or Luxembourg or Bermuda, shifting billions of dollars offshore to tax havens. And there’s no longer a clear line between tax avoidance and tax evasion.

AMY GOODMAN: How much money are we talking about the U.S. losing? Why should this matter to everyday people who don’t use tax havens?

JAMES HENRY: Well, I think it matters in a lot of ways. But one, you know, direct estimate of this is at least $100 billion a year of lost tax revenue to the U.S. Treasury. We also, I think, are undermining the stability and the development of many countries around the world by essentially being one of the world’s largest tax havens. You know, it’s very common for wealthy Mexicans or Argentinians or Brazilians to put their money in New York as opposed to their own countries. And we made it a business not only to solicit this money, but also to conceal it and make sure that it’s tax-free when it gets here.

AMY GOODMAN: I want to turn to another clip from the film, The Price We Pay, where—this, again, in Britain—Labour MPs are questioning Amazon’s director of public policy, Andrew Cecil. The clip begins with Austin Mitchell questioning Cecil, then Labour MP Margaret Hodge speaks.

AUSTIN MITCHELL: I’m interested in why you pay so little tax, corporation tax particularly, in this country, so that we can pay some kind of benefit to all the booksellers you’ve put out of business, because undoubtedly you put a large number of booksellers, some of them local, in my case, out of business. And I don’t get, frankly, from all this interview, why Luxembourg is so lucky. I mean, the books are here, the warehouses are here, the billing is here, the business is here, the customers are here.

ANDREW CECIL: We have paid in excess of 100 million in payroll taxes in the last five years. We’ve paid tens of millions in business rates in the past five years. And—

MARGARET HODGE: I’ve heard this argument before. Let me just kill this argument, because it really makes me cross. On the one hand, so does every other business. So the community-based bookshop that you’re putting out of business also pays business rates, also pays its PAYE, also pays VA—actually, probably pays VAT in a way that you don’t, and you—in the same way. And you’re making it uncompetitive.

And the other thing is, you depend on the services that come out of the tax you pay. So, you know, you depend on the ability of your—of getting your goods around, so you’ve got to get in the truck, the roads in place. You depend on all those things.

And probably, worst of all, both you and Mr. Alstead employ people on probably minimum wage, if we’re lucky. And then we, the taxpayer, pick up tax credit bill for that, too. So we’re putting a lot of money back into the people you put, and you’re not putting enough tax into our economy. That’s what’s riling us all.

AMY GOODMAN: That’s Labour MP Margaret Hodge, interestingly, questioning Amazon. Amazon has just announced they’re opening their first actual bookstore—after putting out of business many actual bookstores around the country—in Seattle, Washington. But I’d like to turn to another clip from the film which features Labour MP Margaret Hodge, as we just were listening to her, and the vice president of Google UK, Matt Brittin.

MATT BRITTIN: What’s different about Google versus the other businesses you’ve been talking about, we’re not selling books, and we’re not making coffee.

MARGARET HODGE: You’re selling advertising space.

MATT BRITTIN: We’re—well, the services we provide to consumers are based on the computer science. That is what creates the economic value for Google.

MARGARET HODGE: What does Bermuda create?

AMY GOODMAN: That is again Labour MP Margaret Hodge and vice president of Google UK, Matt Brittin. The significance of these interactions that you put into your film?

HAROLD CROOKS: Well, the significance of the interactions is the culmination of a story with which the film begins. The film begins with the creation of offshore world—and I’ll try to do this very, very quickly. And we need a historical context for this. The British Empire collapses after the Second World War. London, which had been the capital of global finance up to that point, needs to find a new way to maintain its position as the capital of global finance. What it begins to do is transform its colonial dependencies, particularly in the Caribbean and other places, into secrecy jurisdictions or tax havens. That begins in the late ’50s and ’60s.

When we get into the 21st century, the high-tech corporations, the major high-tech corporations of the cloud economy, like Google, you know, like Amazon, etc., etc., have devised ways for gaming the system so that they are able to put their most valuable assets—the patents and intellectual property to their technology—and book them to a tax havens, where nothing is going on, with the result that hundreds of millions—and now, you know, there’s this estimate that over $2 trillion—of untaxed U.S. corporate profit is booked offshore. Well, offshore is really a fiction. It’s a legal and accounting fiction. The money is actually not there. It’s merely on a separate set of books in New York or London or Paris or New Haven.

And the point of all of this, Amy, is that the offshoring of the world’s wealth is undermining some of the major social innovations of the 20th century—the middle class, Social Security. These are things that never existed before the First World War. And they’re very, very dependent on a whole interconnected bunch of things—progressive taxation, to start with—all of which is being undermined by this offshore world that is now being gamed to the tune of trillions of dollars.

AMY GOODMAN: James Henry, we have 15 seconds. What do you think is most important to do right now?

JAMES HENRY: Well, there’s a global tax justice movement. It recognizes this is a global haven industry that we’re fighting, not just an archipelago of individual havens. And there’s all kinds of tax reform that we need to put on the agenda, going forward. But this is not something that’s going to be made in Washington. It’s going to be something that citizens have to get involved in.

AMY GOODMAN: Do you think Occupy began the movement?

JAMES HENRY: I think Occupy contributed to awareness, but I think, you know, we’ve got to make the focus on tax, because otherwise we have, essentially, these people are becoming citizens of nowhere, for tax purposes, and they have extraordinary representation without taxation.

AMY GOODMAN: We’re going to have to leave it there. James Henry and Harold Crooks, thanks so much for joining us. The film is The Price We Pay.

And that does it for our broadcast. We have a job opening, director of development. Check our website.

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The Price We Pay: Inside the World of Big Corporate Tax Havens and Offshore Finance

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