The World Today for May 14, 2018

NEED TO KNOW

UNITED KINGDOM

The Ties that Bind

The Sackler family of London derives its wealth from manufacturing OxyContin and other opioids. They’re known around the British capital as jet-setting philanthropists and business leaders.

But for years, the Sacklers’ private companies have been routing sales through Bermuda, a British overseas territory that is one of the many nodes of an international web of tax havens that extends around the world.

“This would have allowed profit to be taken on the island nation, where no tax is payable,” wrote the Evening Standard, a London newspaper, in an investigative piece. “However, the products were shipped direct from the UK to the country where they were sold, and did not go anywhere near Bermuda.”

Called “the family that built an empire of pain” in the New Yorker, the Sacklers benefited from their offshore strategy.

But today such schemes might be coming to an end.

Facing a potential backbench rebellion in parliament, British leaders earlier this month agreed to legislation that will compel Bermuda and other overseas territories to publish the true owners of companies based there, the BBC reported. (Here is an explainer about overseas territories, which include the Cayman Islands, Gibraltar, the Falkland Islands and other sites around the globe.)

Proponents of the move said the tax havens hurt taxpayers who must compensate for the government’s lower revenues, especially in poor countries where corrupt leaders abscond with state assets.

But British Virgin Islands Premier Orlando Smith said the new transparency policy was deeply flawed. “It is not only a breach of trust but calls into question our very relationship with the UK and the constitutional rights of the people of the BVI,” he said in a statement quoted by Reuters.

Writing in the Guardian, Prem Sikka, a University of Sheffield accounting professor, supported the move to expose overseas tax shelters. But he noted that it wouldn’t fix Britain’s failure to keep track of all the business deals that launder an estimated $120 billion through the UK annually.

Still, the move had its admirers. Canadians have questioned if they too should compel the publication of the true, or “beneficial,” owners of companies, the Toronto Star reported. “The UK is becoming the global leader for beneficial ownership transparency and holding tax havens to account,” said Richard Leblanc, a business professor at York and Harvard Universities.

The Sacklers theoretically could still use Bermuda under the new proposed rules. But now the full scope of their operations – financial and drug-wise – might be revealed rather than hidden.

WANT TO KNOW

NICARAGUA

Holding Ground

The Nicaraguan army’s calls over the weekend for an end to the violent protests demanding that strongman President Daniel Ortega resign didn’t stop demonstrators from taking to the streets.

The army expressed over the weekend the need for renewed dialogue between student protesters and Ortega’s government. It also said it regretted that more than 60 individuals have been killed since Ortega’s proposed cuts to social security last month prompted continuous nationwide protests by unorganized masses of students – and a brutal crackdown by security forces.

Ortega has since abandoned the proposal. But the violence against protesters combined with Ortega’s tactics to consolidate power over the years have morphed the protests into a movement with staying power.

Thousands of Nicaraguans organized through social media and demonstrated in defiance of the government on Sunday in the city of Masaya, a town about 20 miles southeast of the capital, where two died in protests the previous day, the Associated Press reported.

IRAQ

The Vote of Despair

Muqtada al-Sadr, a fiery Shi’ite cleric who led uprisings against US troops after the American invasion in 2003, took the lead Monday morning as the results from Iraq’s first parliamentary elections on Saturday since the defeat of Islamic State continued to roll in, Reuters reported.

With half of the ballots counted, commentators are calling the results “remarkable,” given that Al-Sadr has lost much of his influence over the past few years to Iranian-backed politicians.

The results are a setback for US-backed Prime Minister Haider al-Abadi, who entered the election as a favorite and took the lead in early polls over the weekend. Now he appears to be in third, behind Shi’ite militia leader Hadi al-Amiri’s bloc, which is backed by Tehran.

Less than 45 percent of eligible Iraqi voters cast ballots, a clear sign of voters’ disenchantment with their current political choices, the Wall Street Journal reported. Final results are expected late Monday.

If Al-Sadr’s bloc wins, he’d almost certainly handpick the post of prime minister, a troubling development for the US, which has called the Mehdi Army, the Shi’ite militia loyal to Sadr, the biggest threat to Iraq’s security.

INDONESIA

A Family Affair

Three nearly simultaneous suicide attacks carried out by members of the same family – including children – on three separate churches in Surabaya, Indonesia, killed 11 people and injured dozens more Sunday, the Daily Beast reported.

At one church, a mother, and her two daughters, 12 and 9, were strapped with suicide belts that they then detonated. At another, the family’s sons, 18 and 16, rode motorcycles with explosives into a church yard and blew themselves up. At a third, the patriarch drove a bomb-laden car onto the grounds and set it off.

Islamic State claimed credit for the attack.

Surabaya, located in east Java, has a significant Christian minority – about 11 percent of the city’s population of almost three million, the New York Times reported. The bombings occurred as followers of Islamic State have started to grow in Indonesia, a Muslim-majority nation: Its first major attack was only two years ago.

The attack also comes just before the start of the Muslim holy month of Ramadan, which usually sees an uptick in attacks, the newspaper wrote.

DISCOVERIES

Analyze This

Sometimes people make odd decisions subconsciously.

While the ideas surrounding such decisions might not be the most logical or accurate, there’s a bit of science behind this process.

Known as “unconscious bias,” our brains take shortcuts to reach certain conclusions, like deciding whom to trust based solely on certain character traits, the New York Times reported.

Researchers have observed that in work settings, for example, people tend to trust those who talk the most and display confidence in their knowledge of particular issues.

Whether logical or not, the brain instinctively tricks us into trusting people who seem to know what they’re talking about – all without allowing the time to objectively assess the situation.

But fret not – every bad habit can be broken.

The simplest solution is awareness of the phenomenon: Take a step back, analyze the person’s credentials and experiences, and judge if their perceived knowledge and trustworthiness is the real deal.

Asking a friend might do the job as well, the Times wrote. Seeking outside input is a great way to get hold of unconscious bias – more knowledge had on a situation begets better decision making.

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