To Pay for the Pandemic, Dry Out the Tax Havens

The costs associated with the COVID-19 pandemic and its massive economic fallout are difficult to estimate, but the sums will be enormous. The first U.S. stimulus package alone exceeded $2 trillion. Then there is the loss of life, reduced economic productivity, and the personal financial ruin many will face. More stimulus packages likely will be required. Worldwide, the total costs will be even higher.

The bitter truth is that the costs and consequences of the pandemic likely could have been avoided or dramatically reduced if leaders had done their jobs. In 2013, the World Bank estimated that an annual expenditure of only $3.4 billion would have let developing countries build up a robust pandemic prevention capability, making a global outbreak much less likely. Yet this relatively modest expenditure wasn’t made.

The money needed to pay for the pandemic is actually close at hand, hidden away in offshore financial centers (OFCs), more commonly known as tax havens. OFCs are estimated to hold up to $36 trillion in cash, gold, and securities, not including tangible assets such as real estate, art, and jewels. (For comparison, U.S. federal tax revenues are a little over $3 trillion a year.) OFCs are located around the world and include Switzerland, Hong Kong, the Cayman Islands, the British Virgin Islands, the Bahamas, the Isle of Man, Luxembourg, Lichtenstein, Ireland, Singapore, Panama, Trinidad and Tobago, the Seychelles, and Vanuatu. And the Financial Secrecy Index, published by the Tax Justice Network, ranks the United States as the second-most complicit country after the Cayman Islands in helping individuals to hide their assets.

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