• Georgetown Times
  • Waccamaw Times
  • Inlet Outlook

Barack Obama vs. the Cayman Islands

  • Thursday, June 27, 2013

  • Updated Monday, September 23, 2013 11:15 am

By Mark Shields

Barack Obama has never minced words about the Cayman Islands. As an Illinois senator, Obama co-sponsored legislation to crack down on wealthy American individuals and corporations using offshore investments and tax shelters to avoid and to minimize what they would owe the U.S. in taxes.

As a presidential candidate, speaking of Ugland House in the Cayman islands — which, according to a 2008 investigation by the U.S. Government Accountability Office, served as the registered office for 18,857 entities (nearly half of which had U. S. billing addresses) — Barack Obama spoke bluntly: "You've got a building in the Cayman Islands that supposedly houses 12,000 corporations. That's either the biggest building or the biggest tax scam on record."

During the 2012 campaign, Republican nominee Mitt Romney — having lacked the wit or the imagination during his six-year quest to divest himself of the political liability of his offshore holdings — became a punching bag for the Obama campaign. Recall Romney's unsuccessful London visit for the Olympics? All the time Romney was overseas, the Obama camp was running an attack ad that began with the president, on camera, stating, "I approve this message," which told the viewer that Mitt Romney "had millions in a Swiss bank account" and "tax havens like Bermuda and the Cayman Islands."

The argument has understandable appeal. Investments and wealth in these offshore tax havens, which have no corporate taxes and no taxes on capital gains, are shrouded in secrecy. As Romney told Robert Costa of the National Review, while explaining why, as a presidential candidate, he had kept his own island accounts, "The so-called offshore account in the Cayman Islands, for instance, is an account established by a U.S. firm to allow foreign investors to invest in U.S. enterprises and not be subject to taxes outside of their own jurisdiction." That's pretty straightforward: The offshore account's purpose is to enable the investor to avoid paying taxes he could otherwise owe to the U.S. Treasury.

Of course, our neighborhood dry cleaner, barber or bakery has neither the deep pockets nor the high-priced accountants necessary to minimize or avoid the taxes they owe by setting up a dummy corporation in the Cayman Islands.

But hold on. It turns out that Barack Obama is outraged by wealthy individuals profiting from Cayman Islands accounts only if those wealthy individuals are card-carrying Republicans.

First, it was revealed that Jack Lew, whom President Obama nominated and whom the Senate eventually confirmed as secretary of the treasury, had, as an executive of Citigroup, a Cayman Islands account worth the pocket-change amount of $56,000 located at the aforementioned Ugland House — "either the largest building in the world or the largest tax scam in the world" — on the Cayman Islands. Citigroup, let the record show, had only 121 such accounts.

Next came Penny Pritzker, Chicago billionaire and hotel executive, whom Obama nominated to be secretary of commerce. Her disclosure report revealed that she had received some $53.6 million last year from an offshore trust in the Bahamas. That's a whole lot more than millionaire Mitt Romney earned from his offshore accounts.

Most recently, President Obama chose his Harvard Law School classmate and friend, Michael Froman, his longtime economic advisor, to be the U.S. Trade Representative. Thanks to The New York Times' Jonathan Weisman, we find that Froman, another alumnus of Citigroup, held $490,845 in a fund managed by his employer and housed — you guessed it — at Ugland House.

Three presidential nominees, all with serious offshore holdings, demand some serious explaining from the White House. Are offshore investments only evil when Republicans make them and somehow insignificant when they enrich Democrats?



To find out more about Mark Shields and read his past columns, visit the Creators webpage at www.creators.com.

DISTRIBUTED BY CREATORS.COM

COPYRIGHT 2013 MARK SHIELDS

Opinions that appear on this page in Letters to the Editor or in columns do not necessarily reflect the opinions of this newspaper.

Comments

Notice about comments:

South Strand News is pleased to offer readers the enhanced ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. We do not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not South Strand News.

If you find a comment that is objectionable, please click "report abuse" and we will review it for possible removal. Please be reminded, however, that in accordance with our Terms of Use and federal law, we are under no obligation to remove any third party comments posted on our website. Read our full terms and conditions.



South Strand News

© 2014 South Strand News an Evening Post Industries company. All Rights Reserved.

Registration on or use of this site constitutes acceptance of our Terms of Service, Privacy Policy and Parental Consent Form.
150-02-88705