Who would have thought, 50 years ago, that there would no longer be a Cold War, that technology would advance so fast and that we would be living in such an interconnected world that added so much to the empowerment of the people? Probably, only a few could have imagined the extent of change that the global society would experience. However, people tend to develop a historic arrogance by applying current circumstances to previous settings and criticising people in the past for their actions – we tend to constantly think that the contemporary situation is the best that has ever been. There are some reasons to believe that this is true. For example, today we have more inventions than ever before, or with the expansion of the internet more people than ever can globally voice their opinions. In spite of all that, we should be reflective on our societal progress and rather than solely assessing it from the positive sides, we could also assess societal advancement in terms of the problems and our responses to those problems. In other words, nuclear fission is only as far an improvement as it is not used to build an atomic bomb.
There is much reason to believe that a growing societal lethargy and decadence is developing. Among the many ways to analyse this hypothesis, this article leans on a comparative case study that juxtaposes two seemingly unrelated phenomena: the Corona Pandemic of 2020 and the leak of the infamous Panama Papers.
Corona Vaccine? Who knows what is in there?
The 2020 global pandemic is an every burdensome crisis for great parts of the global population. Depending on the country, social activities are restricted and many people are also professionally affected by the limitations of the crisis. Next to the many interesting aspects of this crisis, one is particularly fascinating: the public opinion on the crisis. There are many different opinions on the crisis and everyone seems to be involved in the discussion – it seems like everybody has something to say about the situation. Among many other opinions, some people criticise their government for being too lax or not strictly enforcing measures to prevent the spreading of the virus, others criticise the government for being too strict and claiming that citizens’ personal freedoms are jeopardised, yet others criticise governments for being inconsistent and others do not even believe in the existence of the virus. Taking one step further, the opinions on the vaccine against the virus also diverge greatly. In any case, ask someone about the Corona virus and they will tell you something about it, regardless of their level of knowledge on the topic.
Panama? Oh, they have the canal, right?
Back in 2016, over 11,5 million documents were leaked that contained financial information on thousands of accounts that were, and still are, used to evade taxes. These documents are infamously known as the Panama Papers, because they were published by hackers who gained access to, then, one of the largest law firms for offshore tax evasion in Panama, Mossack Fonseca. With this leak (you can find the full documents here), an endless list of the names and accounts of businessmen and women, celebrities, politicians and other millionaires was made public. The whole world is able to see who deposits her money where. Since Caribbean states, such as the Cayman Islands, Bahamas or Panama, have highly favourable taxation systems in place, millionaires and billionaires have great interest to move their assets under such a jurisdiction. Just to make this clearer: there is a huge difference in paying 10€ million in taxes or just 5€ million per year. To put this into perspective, investing only this 5€ million with a yearly return of 8% would make almost 11€ million 10 years later. Now, add 5€ million to this savings plan each year and multiply this with thousands of other accounts and you end up with ridiculous numbers. In addition to the Panama Papers, it can be assumed that there are also many more people engaging in tax evasion other than those enlisted in the documents and that not only the number of those people is growing, but, more importantly, the size of their assets, too. All in all, every year states lose trillions of Euros, because many rich people do not pay the full amount of taxes in the state they are conducting business in. These considerable sums could be used to finance infrastructure projects, improve the education system, modernise hospitals, increase welfare spending, reducing homelessness, invest in renewable energy sources, improve capital markets performance, tackle issues in the housing market or better train teachers, the police and politicians. Instead, those who own such accounts are able to hoard the saved money and reinvest it for it to reproduce. That being so, societies’ development rates remain below their real potential.
Corona? Panama? Where is the connection?
The previous paragraphs seem to treat very different aspects, but they are connected. In the Corona case, everybody is eager to enter into discussions, voice their opinions and make normative claims in regard to the situation. In the case of the Panama Papers, nobody is talking about it – it is a forgotten side note in our history books. Not because we never assumed that there is no tax evasion, but with the leak we know their faces – we know who is taking money away from us. During the pandemic, there were countless public protests with thousands of participants. All over social media, people are launching campaigns against the vaccine and against social distancing rules. When the Panama Papers were leaked, nobody went to the streets that public money is being withheld. Malcolm Turnbull, former prime minister of Australia, easily served until the end of his term, Saudi Arabia’s King and the President of the United Arab Emirates are still serving. While populist leader Marine Le Pen throws around nationalist slogans, her father and founder of the nationalist party, withholds millions from the French state by hoarding that money in offshore accounts. It remains unclear how many more high-ranking politicians are involved in tax fraud. Nobody is in the streets.
When it comes to wearing a mask, the citizens are quick to voice their anger. It is a tangible measure and they dislike it. Citizens dislike the restrictions and the vaccine, but they do not seem to dislike that money is withheld from them. All the taxes that are not paid, and it cannot be stressed enough, would have helped all the citizens to live a better life. Withholding this money from a state severely hampers its growth rate.
It is interesting to see that there is such a discrepancy in the reactions to these two different global events. In both cases, all citizens are equally affected. However, in the case of the pandemic, citizens are merely subject to minor inconveniences, such as wearing a mask or not being able to go shopping. On the other hand, tax evasion takes away real quality of life, as the quality of public services cannot live up to its potential. In essence, there are protests against wearing face masks, but not for better schools.
And maybe that is the core aspect of this whole situation: the difference between reaction and action. What makes the two global events different is that the pandemic triggered reactionary actions, while the leak of the Panama Papers required proactive actions. This is a clear sign of decadence and broader societal decline: when societies stop to proactively seek ways for improvement and only react when something is happening to them. Maybe, we are not so much better than the generations before us. Maybe, we are gradually losing our visionary drive and make room for our convenient lethargy. Maybe, it is time to rethink what our priorities are.