Opinion: George Osborne and tax evasion what’s trending? via Storify – John Gelmini

HM Revenue & Customs

HM Revenue & Customs (Photo credit: jam_90s)

The answer to Dr Alf’s perfectly reasonable question is because George Osborne has large numbers of friends engaged in paying as little tax as possible and because he knows that if he starts to tackle tax evasion by multinationals (practically all of them), that they will re-base themselves in more tax efficient locations, as Sir Richard Branson, Sir Ralph Halpern, Sir Philip Green, David Coulthard, the former racing driver, Glaxo Smith Kline, the Barclay Brothers, Lord Vestey, Union International Group, Hanson Trust and most of the top media groups have already done.

State Street, the American company tasked by the Government to manage the funds in Stakeholder Pensions under “Auto Enrollment”, are based in the Dublin Financial District as are HSBC, BT PLC, Facebook, Linked In, Microsoft, Google, Amazon, Mandiant and a host of British and American companies who “book sales” in Eire rather than the UK.

I have seen the buildings myself, earlier in the Summer, during a short Citybreak yet the Government did nothing because they knew that these companies had been secretly promised just 3% Corporation Tax by the Irish Government.

HMRC does nothing because they lack the trained staff capable of out-thinking Big 4 accountancy practices and because they themselves use offshore special purpose vehicles devised by PWC and KPMG for their own buildings (See Private Eye editions and Google Mapeley Steps in Bermuda).

Then, there is the revolving door between the Big 4 and HMRC, whereby on one day a Big 4 partner will be devising aggressive tax avoidance schemes and on another he or she is working for HMRC as a poacher turned gamekeeper.

Whilst they “game-keep” to close down the first set of schemes, their colleagues devise many more new ones in such quantity that HMRC could never keep up.

It is the civilized version of Krupp and Sir Basil Zaharoff working to produce armor-piercing shells to a South American dictatorship on one day, and then selling tough armor plate to the rivals of those countries for use on battleships.

The system works in reverse as people like Dave Harnett the former CEO of the HMRC advise multinationals on tax avoidance.

Whilst working for HMRC before this, he let Vodaphone off a £6 billion gbp tax bill against the legal advice of HMRC’s lawyers and refused to talk about this and companies like Eon who have not paid any Corporation Tax for the past 8 years according to Margaret Hodge at the Public Accounts Committee.

For the super wealthy and large multinationals, tax is optional and unless you get Global Governance, a single currency for the whole world and global tax enforcement it will always be like that despite all the huffing,puffing and mock indignation by politicians.

The late Leona Helmsley put it best “Little people pay taxes”.

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Moritz Erhardt: Extreme Personal Competition to the Death – John Gelmini

Wall Street Sign. Author: Ramy Majouji

Wall Street Sign. Author: Ramy Majouji (Photo credit: Wikipedia)

Dr Alf has raised difficult issues within this blog about the intense competition for high flyers that prevails in the rarified atmosphere of the investment banking community and the processes it uses to find and reward and develop the so-called “Masters of the Universe”.

These were once depicted as the Gordon Gekko character, played by Michael Douglas in the 2 Wall Street films but because of the failings of the UK education system many of these aspirant investment bankers come from countries within and outside of the EU where the teaching of mathematics is of a much higher standard.

Moritz Erhardt, the 21-year-old,  Bank Of America Merrill Lynch (BOAML) intern, who died after
working for 3 days and nights without sleep in a row, was typical of the sort of employee employed by City/Wall Street investment banks.

He was also like many young people in pressurized environments, who are expected to perform to extraordinary lengths.

The hours worked by Junior hospital doctors used to be not dissimilar to the hours worked by BOAML until they were limited by the EU’s Working Time Directive, airline pilots, lorry drivers and others used to drive until they got what the Americans called “White line fever” and even now, we hear of a Ryanair pilot being dismissed for” industrial misconduct” because he revealed the numbers of hours he was being forced to work, the low margin of error in terms of fuel that he was allowed to complete his flights with.

In Japan many of the so-called “salarymen” have literally died of overwork or been found dead in one of their sleeping pods. The spouse of one tried to sue her late husband’s employer for working her husband to death but the Japanese courts were highly unsympathetic and threw the case out.

At GE and what is now part of Sir Philip Green’s Arcadia Group PLC, I can remember working on pre acquisition due diligence for several days at a stretch without sleep and often at different ends of the country after hours of driving.When I did it, I was considerably older than the youthful Moritz Erhardt but these sorts of time pressures are not untypical when you are locked into a very tight timetable by a CEO who demands 125% and a perfect report or dazzling presentation by 7.00 AM on Monday morning.

Dr Alf asks what can be done to make internships cleaner.

Clearly they will have to be regulated as to:

–Pay (Too many carry no salary of any kind)

–Access (Competition is fierce but the process must be opened up to a wider range of people)

–Hours and intensity of workload

Studies commissioned by the world’s military forces show that without sleep, performance falls, mistakes are made and that eventually madness and death ensue.

That is why commandos on night operations were given amphetamines to enable them to complete their missions but afterwards had to get some sleep.

People have physical, mental, emotional and psychological limits and we cannot push people to those limits and expect no casualties.

Moritz Erhardt was a casualty which may or may not have been avoidable and his relatives may well have a case for breach of an employers duty of care and a massive payout.

Until there are more deaths and successful legal action is brought nothing will change but there is no doubt something needs to be done to break this cult of testosterone fueled lunacy.

John Gelmini


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