Monthly Archives: November 2017

11.20.17
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Yemen: The UK-US-Saudi war enters a new genocidal phase

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Two-and-a-half years of a lethal blockade and non-stop bombardment have produced almost nothing in the way of territorial gains in the West’s Saudi-executed war against the Yemeni nation. The latest tightening of the blockade is an obscene and desperate attempt to postpone its inevitable defeat.

 

The war against Yemen – sponsored by the West and executed by their ever-loyal Saudi fall guys – is going badly. Very badly.

When the Saudis began their bombardment of the Arab world’s poorest country, named ‘Decisive Storm’, in March 2015, they promised a ‘limited’ mission. In reality, it has proved to be seemingly limitless and completely indecisive. A Harvard study estimates the Saudis are spending $200million per day on this war, driving their military budget up to $87billion, the third highest in the world.  But they remain nowhere near achieving their stated goal of defeating the Houthi-led resistance and recapturing the capital, Sanaa. Indeed, Hadi, the ‘President’ the Saudis are supposedly supporting, is still holed up in Riyadh,apparently unable to set foot in his own country, such is the depth of popular animosity towards him.

Meanwhile, the ‘coalition’ which Saudi Arabia purports to lead is falling apart. Qatar – the world’s richest country in terms of per capita income, who were supposed to bankroll a large chunk of the war – pulled out long ago; whilst the Pakistani parliament – whose allotted role was to provide the ground troops – unanimously vetoed the proposal last year. Meanwhile, in the South, the Emiratis are backing forces hostile to the very President the war purports to be defending. Indeed, Hadi’s own troops are now complaining that the Saudis and Emiratis are actually bombing them. Yes, the ‘legitimate government’ of President Hadi – the one the whole operation is supposedly being fought in support of – is now itselfbeing targeted by the aggressors, with Hadi accusing the Emirati crown prince ofacting like an occupier. Tawakkol Karman, a Nobel peace prize-winning activist, even suggested that “ the Saudi-led air strikes have killed more fighters of the national army than Houthis.” Furthermore, the war has massively expanded Al Qaeda’s base in the country, and provided a new one for ISIS. Whilst this is not an immediate problem for Saudi Arabia in itself – after all, the more sectarian forces come to the fore, the less likely Yemen will be able to unite and pose a threat to Al Saud – but is nevertheless a real potential danger for the future, should those forces decide to turn their experience and weaponry on the kingdom itself. The Saudis seem to be, belatedly, recognising this, recently branding as ‘Al Qaeda terrorists’ one of the biggest Salafi groups in the country, the Abu Abbas brigade – after years of arming its men.

Indeed, the war is going so badly that even the Saudis themselves are now privately saying they want out. Leaked emails last August revealed that Crown Prince Mohammed bin Salman – who as defence minister was responsible for initiating the war in March 2015 – is keen to end the war. Yet still the war continues. London-based Yemeni Safa al-Shami told me that “The Saudis are in trouble; they don’t want [the war] to continue anymore. But they are being told ‘you have to finish the mission to the end’.” By this analysis, far from ‘turning a blind eye’ to a ‘Saudi war’, the West are positively demanding that a reluctant Saudi Arabia continue its futile and murderous campaign.

And this campaign, already characterised by a brutally callous attitude to the Yemeni population, has just reached a new level of terror. Humiliated by the firing of a Houthi missile into Riyadh on November 5th – demonstrating that, despite years of pummelling, the Houthis are now stronger than ever – the Saudis announced that their blockade would henceforth become total, with entry of allgoods to the country – via land, sea or air – completely ended. Medicins san Frontier verified the following week, that all their humanitarian flights into the country had been blocked. The Saudis then announced that some of the minor ports would be reopened, but only those in government-held areas. The country’s biggest port, Hodeidah, on which 80% of the population depend, remains closed, and this week, the Saudis bombed the capital’s airport again, preventing aid delivery.

Even in it’s previous, partial, form, the blockade’s results have been truly sickening. Hodeidah’s capacity has been massively crippled since its four cranes were destroyed by coalition airstrikes in 2015, and the ‘coalition’ has prevented replacements being installed ever since. In addition, ships have been delayed, often for months, or turned back altogether for no explicable reason other than to punish the populations of Houthi-controlled areas. This siege – against a country dependent on imports for over 80% of its food, fuel and medicine – is nothing less than genocidal. Save the Children reported this week that 130 Yemeni children are now dying every day from extreme hunger or disease, with 50,000 killed this year alone. Meanwhile, the cholera epidemic – triggered by a combination of the war’s crippling of water sanitation systems and the Hadi government’s decision to block payments to all waste, sewage and health workers in Houthi-controlled areas – became the biggest in recorded history last month, with almost 900,000 infected by the disease. The previous biggest epidemic, still underway in Haiti, took seven years to reach 800,000 cases. Yemen surpassed that number in just six months.

Yet, with two-thirds of the population – over 18 million people – now dependent on humanitarian aid for their survival, even these shocking figures are set to escalate very quickly. Seven million people are at immediate risk of famine. If this new total ban on humanitarian aid to the country’s biggest air and sea ports is maintained, they will die. These are the depths to which the West is prepared to push Saudi Arabia in its futile drive to permanently destroy the ‘Yemeni threat’.

The UN’s humanitarian chief, Mark Lowcock, has been very clear. “I have told the [UN Security] Council that unless those measures are lifted … there will be a famine in Yemen. It will not be like the famine that we saw in South Sudan earlier in the year, where tens of thousands of people were affected. It will not be like the famine which cost 250,000 people their lives in Somalia in 2011. It will be the largest famine the world has seen in many decades, with millions of victims.”

Britain and the USA are driving the Saudis to unleash the world’s biggest famine for years against a totally captive population. Yet, as far as Western media is concerned, this is all totally un-newsworthy. The wilful starving to death of 130 children per day for the whole of this year is a footnote, at best, to this week’s rumours about Brexit or Trump’s latest absurd vulgarity. When I met Safa Al-Shami, she asked me, “Where is the media in all of this? How many pictures have we seen from Syria, from Iraq; where is Yemen in all of that? The media should start talking about this!” But she was  also clear that this lack of coverage is no excuse for a lack of action, at least not in Britain. “Look at how the British people marched and demonstrated because Tony Blair declared war against Iraq. The British people need to realise that this war in Yemen is part of the same dirty game. They have to do something. I blame the British people because they are educated and they know. The Americans are ignorant.” The horrors inflicted on Yemen by the British have deep historical precedents – it was 50 years ago this month that British forces finally withdrew from Aden, the Yemeni port they had colonised in 1839. Indeed, the country is embedded enough in the national consciousness to be the subject of a new BBC drama, whitewashing and glorifying the British colonisation of Yemen just as they whitewash the British role there today.

And yet the British still like to think of Boris Johnson as some kind of affable buffoon. The truth is, he and the entire UK cabinet are child murderers on the most monstrous level. They, along with all those parliamentarians who voted to continue this vicious war, must be stopped, held to account and brought to justice.

An edited version of this piece was originally published by RT.

11.20.17
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European identity is founded on hostility to Islam in general and Turkey in particular

My commentary on the news that Turkey is pulling 40 soldiers out of a NATO exercise in Norway after Erdogan’s name appeared in a list of enemies on a poster at the drill. Erdogan said an “enemy poster”, featuring his name on one side and a picture of modern Turkey’s founder, Mustafa Kemal Ataturk, on the other, was unfurled at the training exercise in Norway, prompting a decision by Turkey’s military chief and European Union minister to pull the troops out.

11.08.17
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Close down Gibraltar

This article was originally published in April 2017 on RT.com 

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British sovereignty over Gibraltar stems from the same treaty that gave Britain a monopoly on the slave trade and granted Brazil to Portugal. It, like all these abominations, belongs in the dustbin of history.
The British ruling class have been frothing with belligerent outrage this week following EU President Donald Tusk’s comments on Gibraltar in his letter to Theresa May. Responding to the British Prime Minister’s letter formally requesting to leave the EU, Tusk noted that any agreement between the UK and the EU would not apply to Gibraltar without Spanish consent. The statement was hardly controversial in itself, given that all member states already have a veto over any agreement, such is the nature of the decision-making in the EU. As Stephen Bush commented in the New Statesman, by giving Spain a veto over the terms of a future trade deal, Tusk was giving it “a right which it already has an EU member”. Indeed, compared to Ms’ May’s thinly veiled threat to unleash terrorism against the EU should Britain not get the deal it wants, Tusk’s gentle reminder of the existing state of affairs was positively christlike.

 

Nonetheless, it was enough to provoke the full fury of British supremacism. The Sun newspaper devoted its entire front page to declaring “Hands off OUR rock” (helpfully translated into Spanish for the paper’s Iberian readers), whilst former Tory leader Michael Howard waded in with a threat to rerun the Falklands war. Current Tory defence minister Michael Fallon appeared to embrace this approach with a promise that Britain will “go all the way” to keep Gibraltar under British rule, a classic euphemism for the use of armed violence.  

 

All of this prompted a slightly bemused response from the Spanish, with Foreign Minister Alfonso Dastis commenting that his government was “surprised by the tone of comments coming out of a country traditionally characterised by its composure…it seems someone is losing their cool”, he added.

 

In fact, the longest rulers of Gibraltar were neither Spanish nor British, but North African Muslims. The word ‘Gibraltar’ itself comes from the Arabic name for the Rock – Jabat-at-Tariq, meaning “mountain of Tariq”. Tariq led the Ummayad conquest of Gibraltar in 711 and it remained, along with the rest of Spain, under Moorish control until 1462. Then, after two and half centuries of Spanish rule, Britain took the territory in 1704, its troops conducting mass burglary and rape, causing over 90% of the inhabitants to flee. In 1713, Britain forced Spain to cede the territory to Britain “in perpetuity” in the Treaty of Utrecht, turning it into another piece of Britain’s growing colonial jigsaw.

 

A glance at the map immediately reveals the strategic value of the tiny territory, especially to an Empire like Britain’s, based on control of the seas. The southernmost tip of Western Europe, Gibraltar lies just 8 miles from the North African coast, making the Strait of Gibraltar the narrowest ‘choke point’ on the Mediterranean. As a British naval base, it played a key role in the battle of Trafalgar, the Crimean war, and the World War Two campaign against German U boats. Following the misnamed ‘decolonial period’ in the 1950s and 60s, Britain took care to hang on to a series of such strategically placed territories to ensure it could continue to project military power against those of its former colonies that dared to challenge the new neocolonial dispensation. This covert empire included places like Diego Garcia, leased to the US as a crucial refuelling stop for its long-distance bombers following the ethnic cleansing of its native population; parts of Cyprus, regularly used to dispatch British fighter jets to the Middle East; Falklands, an air and naval base from which to intimidate Latin America; and Gibraltar.

 

Gibraltar’s strategic importance increased massively following the opening of the Suez canal in 1882, becoming a crucial point on the sea route between Britain and its empire in the East; today, fully one half of all world trade passes through the strait, including one third of oil and gas shipments.

 

But Britain’s strategically located islands and peninsulas are not only military bases; they also make up what leading tax haven expert Nicholas Shaxson calls a global “spider’s web” of tax evasion and money laundering. Following the end of (most of) Britain’s formal empire, lawyers, bankers and criminals from the City of London, New York and elsewhere, helped to turn Britain’s overseas territories into jurisdictions offering absolute secrecy to those seeking to hide their wealth from both the tax authorities and the criminal justice system. Effectively, places like Gibraltar, alongside other UK-managed territories such as the Cayman Islands, Bermuda, Jersey, Guernsey, the Turks and Caicos islands, and the British Virgin islands, were transformed into a giant global money laundering service. Local branches of the major London banks were established in each territory, taking in vast amounts of criminal wealth, which could then be safely transferred to each bank’s parent branch in London. Today, the developing world is estimated to lose $1.25trillion per year in illicit wealth transfers to tax havens in this way, around ten times the rich world’s aid budget. As Shaxson puts it, “For every dollar that we have been generously handing out across the top of the table, we in the West have been taking back some $10 of illicit money under the table”. Eva Joly, a magistrate involved in investigating the criminal use of tax havens, commented that “It has taken me a long time to understand that the expansion in the use of these jurisdictions has a link to decolonisation. It is a modern form of colonialism”.

 

Gibraltar is a major part of this criminal network. John Christenson, former Economic Advisor to Jersey, itself a major UK-run tax haven, noted that “the instruction from senior partners in London was to direct the really, really dodgy business away from Jersey to Gibraltar…[we] regarded Gibraltar as totally subprime. This was where you put the real monkey business”. This was apparently confirmed in 2014, when OLAF, the European anti-fraud office, revealed that it had “a number of concerns” over “cigarette smuggling across the border” between Gibraltar and Spain, including “indications of the involvement of organised crime”. The following year, Spanish newspaper ABC reported that Gibraltar was home to no less than 15 organised crime gangs connected to drug smuggling, money laundering and the Russian mafia. In 2008, Expatica.com  reported that, according to Spain, “Gibraltar refuses to cooperate in investigations into money laundering, tax evasion and organised crime”, quoting a Spanish police official involved in anti-money laundering operations as saying that “we’ve reached a point where when we chance upon something related to Gibraltar in an investigation we prefer to leave it aside because we face a brick wall. It is useless trying to get information.”

 

Indeed, this is the whole point of a tax haven: it guarantees secrecy to its depositors, protecting them from the taxman and criminal investigators alike. This is precisely what enables them to soak up so much of the world’s stolen wealth and channel it into London.

 

The secrecy offered by Gibraltar is astonishing. The beneficial owners of any company incorporated in the territory – that is, the ones actually taking the revenues – are not only kept private, but are not even submitted to the registrar of companies. ‘Nominee’ shareholders and directors can be used – that is, people not genuinely connected to the company in any meaningful way – and only one of each needs to be named. Gibraltar has signed no information exchange treaties with any other country, meaning that, according to taxhavens.biz, “information regarding offshore clients is safe and will not get back to other country’s tax authorities”.

 

Ah yes, tax avoidance. Gibraltar has no sales tax, no capital gains tax, no inheritance tax, wealth taxes or estate taxes. Since 2010, it has had a corporate tax rate of 10%, although it is currently under investigation by the European Commission for, probably illegally, exempting at least 165 multinational corporations from even paying this.  As Richard Murphy has noted, Gibraltar is “deliberately run as a tax haven with the intention of undermining [Spain’s] tax revenues.”

What’s more, this is all likely to get a lot worse unless action is taken. At present, Gibraltar is – at least in theory – bound by EU regulations on financial transparency. Once it leaves the EU, however, none of those will apply. This is why Spain, in particular, is so worried about Gibraltar being used to destroy its tax base even further. As Richard Murphy of Tax Research UK has pointed out, Gibraltar “is funded by its activity as a tax haven and centre for offshore gambling. The first activity is intent on undermining the global economy and the legitimate tax revenues of democratically elected governments. The other is wedded to destroying individual lives. Quite emphatically, this is a place that is dedicated to undermining wellbeing”. It is time it was closed down.

11.07.17
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Britain is the heart and soul of tax evasion

This article was originally published in April 2016 on RT.com

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The British government’s claim to be tackling tax avoidance is about as credible as Al Capone claiming to be leading the fight against organized crime. In fact, Britain is at the heart of the global tax haven network, and continues to lead the fight against its regulation.

The 11 and a half million leaked documents from Panamanian law firm Mossack Fonseca have proven, once again, what we have already known for some time – that the ‘offshore world’ of tax havens is a den of money laundering and tax evasion right at the heart of the global financial system.

Despite attempts by Western media to twist the revelations into a story about the ‘corruption’ of official enemies – North Korea, Syria, China and, of course, Putin, who is not even mentioned in the documents – the real story is the British government’s assiduous cultivation of the offshore world. For whilst corruption exists in every country, what enables that corruption to flourish and become institutionalized is the network of secretive financial regimes that allow the world’s biggest criminals and fraudsters to escape taxation, regulation and oversight of their activities. And this network is a conscious creation of the British state.

You wouldn’t know this, of course, listening to the words of the British Prime Minister, who always casts himself on the side of the angels. In 2013, David Cameron hosted a G8 Summit claiming that he would lead a push for an end to the use of tax havens as a means for what he called “shady secretive companies” to hide their cash and activities. In the event, nothing of any substance was agreed, largely due to Cameron’s failure to conduct the necessary behind-the-scenes lobbying: the posturing, it seems, was designed solely for public consumption.

Even today, in response to the Panama Papers, Number Ten continue to claim that Cameron put tax evasion “front and centre” of Britain’s G8 presidency and is now “ahead of the pack” on tax transparency.” Keen to hype up what will no doubt be another round of empty rhetoric and BRICS-bashing, Foreign Secretary Philip Hammond has also chimed in: “We’ve got an anti-corruption summit here in May. This is a key agenda for the Prime Minister”.

What the Panama Papers demonstrate, however, is that the real, and hidden, key agenda for the British government is maintaining the offshore netherworld’s role as a conduit through which global funds, largely plundered from the global South, can escape democratic control to enter the City of London’s private banks.

Of the 215,000 companies identified in the Mossack Fonseca documents, over half were incorporated in the British Virgin Islands, one single territory in what tax haven expert Nicholas Shaxson calls a “spider’s web” of well over a dozen separate UK-controlled dens of financial chicanery. In addition, the UK was ranked number two of those jurisdictions where the banks, law firms and other middlemen associated with the Panama Papers operate, only topped by Hong Kong, whose institutional environment is itself a creation of the UK. And of the ten banks who most frequently asked Mossack Fonseca to set up paper companies to hide their client’s finances, four were British: HSBC, Coutts, Rothschild and UBS. HSBC, recently fined $1.9bn for laundering the money of Mexico’s most violent drug cartels, used the Panamanian firm to create 2300 offshore companies, whilst Coutts – the family bank of the Windsors – set up just under 500. And, of course, David Cameron’s own father was named in the papers, having “helped create and develop” Blairmore Holdings, worth $20million, from its inception in 1982 til his death in 2010. Blairmore, in which Cameron junior was also a shareholder, was registered in the Bahamas, and was specifically advertised to investors as a means of avoiding UK tax. The Daily Mail noted that: “Even though he lived in London, the Prime Minister’s father would leave the country and fly to Switzerland or the Bahamas for board meetings of Blairmore Holdings – to ensure it would not have to pay UK income tax or corporation tax. He hired a small army of Bahamas residents, including a part-time bishop, to sign its paperwork – as part of another bid to show his firm was not British-based.”
That Britain should emerge as central to this scandal is no surprise. For as Nicholas Shaxson, a leading authority on tax havens, put it when I interviewed him in 2011, “The City of London is effectively the grand-daddy of the global offshore system”. Whilst there are various different lists of tax havens in existence, depending on how exactly they are defined, on any one of them explains Shaxson, “you will see that about half of the tax havens on there, of the ones that matter, are in some way British or partly British.” These are essentially of three types. Firstly, are “Jersey, Guernsey and the Isle of Man: the crown dependencies. They’re very fundamentally controlled by Britain.” Next are the Overseas Territories, such as the Caymans, Bermuda, the Virgin Islands, Gibraltar and the Turks and Caicos Islands, in which “all the things that matter are effectively controlled by Great Britain”. Of course, it suits the British government to portray all these territories as ‘autonomous’ or ‘self-governing’ in order to provide itself with plausible deniability about what they are doing. But the reality is that the overseas territories are run by a governor appointed by the Queen on the British government’s advice. The governor, not the elected council, Shaxson notes in his book Treasure Islands, “is responsible for defence, internal security and foreign relations; he appoints the police commissioner, the complaints commissioner, auditor general, attorney general, the judiciary and a number of other senior public officials. The final appeal court is the Privy Council in London”. Casey Gill, one of the earliest lawyers specializing in offshore operations explained how legislation was devised in the Caymans: tax experts and accountants would fly in from all over the world “and say ‘these are the loopholes in our system’. And Caymans legislation would be designed accordingly”, often by a conglomerate run by Gill, before being sent to the British Foreign Office for approval. Shaxson asked Gill if Britain, who had the power to veto such legislation, ever raised any objections. “No,” he said, “Not ever. Never”.
Finally, “there are other countries that are either in the British Commonwealth or they have very long and deep historical links with Britain. All of these different networks feed money and feed the business of handling money into the City of London. And so the City is the biggest protector – the City of London Corporation but also the banks located in the City – huge defenders of the tax havens around the world.” Recently, the City of London Corporation has been negotiating with the Kenyan government on plans<http://africanarguments.org/2015/12/01/campaigners-warn-of-kenyas-secretive-plan-to-set-up-international-financial-centre/> to create an ‘International Financial Centre’ in Kenya, which will effectively turn Kenya into the first tax haven in mainland Africa.
The entire UK-controlled web is home to offshore deposits estimated in 2009 to be worth $3.2trillion, 55% of the global total: equivalent to roughly $500 for every man, woman and child on the planet.
In his book ‘Treasure Islands: Tax Havens and the Men Who Stole the World’. Shaxson describes how, in the 1960s, a “London-centred web of half-British territories” was “deliberately created” in order to “catch financial business from nearby jurisdictions by offering lightly taxed, lightly regulated and secretive bolt holes for money. Criminal and other money could be handled by the City of London, yet far enough from London to minimize any stink”.
Whilst ostensibly involved in a process of ‘decolonisation’, in fact the UK hung on to a large global network of small, sparsely-populated islands; “the British empire”, Shaxson wrote, “had faked its own death”. These islands were to serve the same imperial purpose the empire had always had: the projection of British power and the channeling of African, Asian and Latin American wealth into Britain. But whilst some of the islands, such as Diego Garcia and the Falklands, were to serve as crucial military outposts, many of the others were developed as a means of facilitating the financial plunder of the former colonial world. In Shaxson’s words, the role of these tax havens is to “capture passing foreign business and channel it to London just as a spider’s web catches insects” whilst also acting as a “money laundering filter that lets the City get involved in dirty business while providing it with enough distance to maintain plausible deniability”. Whilst the vast majority of critical media reporting on tax havens tends to portray the UK as a ‘victim’ of tax havens, the reality is that, just like the empire they replaced, these ‘treasure islands’ provide a massive cash injection into the ‘motherland’: “in the second quarter of 2009”, Shaxson writes, “the UK received net financing of US$332.5billion just from its three Crown Dependencies Jersey, Guernsey and the Isle of Man”. And where does this money come from? Obviously, it comes from all over the world; but wealthy European and North American nations have been much better equipped to prevent ‘capital flight’ from their territories than have developing countries. Indeed, the Bank of England took special care, when it was establishing the global tax haven network, to protect the UK from potential ill effects; a letter from the Bank of England quoted by Shaxson, written in 1969 and marked ‘secret’, writes of the new tax havens that “there is of course no objection to their providing bolt holes for non-residents but we need to be sure that in so doing opportunities are not created for the transfer of UK capital to the non-Sterling area outside UK rules”. As Shaxson comments, “No objection to the looting of other countries – so long as Britain was protected”. Of course, it is the poorest countries which are in the worst equipped to defend themselves against this looting.
In 2008, Global Financial Integrity estimated that flows of illicit money out of developing countries into tax havens were running at about $1.25 trillion per year, roughly ten times the total value of aid given to developing countries by the rich world. Shaxson himself originally came to be interested in tax havens whilst investigating the illegal West African oil trade. As he explains: “I began to see how the terrible human cost of poverty and inequality in Africa connected with the apparently impersonal world of accounting regulations and tax exemptions. Africa’s supposedly natural or inevitable disasters all had one thing in common: the movement of money out of Africa and into Europe and the United States, assisted by tax havens and a pinstriped army of respectable bankers, lawyers and accountants. But almost nobody wanted to look beyond Africa at the system that made this possible”. People, like Cameron, were more interested in handwringing about ‘corrupt African governments’ than in examining the system that enabled and promoted this corruption. Tax havens are facilitating the plunder, by the London banks, of African wealth. And they are doing so because this is what they were designed to do – to continue the extortion of colonialism, just at the moment Britain was forced to give up the bulk of its formal empire.
It is this system that Cameron’s government – in diametric opposition to its rhetorical flourishes – is working to perpetuate.  Indeed, much of Cameron’s battling with Europe has been driven precisely by the desire to maintain the impunity of the City and its web of tax havens in the face of attempts by the EU to regulate the banking sector. As the FT reported this week, “David Cameron personally intervened in 2013 to weaken an EU drive to reveal the beneficiaries of trusts, creating a possible loophole that other European nations warned could be exploited by tax evaders”. Britain has also led opposition to EU attempts to reforms that would make corporations register for tax in the places where they actually do business. And one of the key concessions Cameron managed to wring out of the EU Summit in February this year was that Britain, in the words of the Telegraph, “can now pull an emergency lever over eurozone laws they have “reasoned opposition” to, forcing leaders to hold back from implementation until their concerns are addressed”. The Telegraph then gives some revealing detail on exactly what kinds of laws might trigger Britain’s ‘reasoned opposition’: “The protections will address real concerns in the Treasury that the EU will develop a sprawling framework which will clamp down on the reckless “Anglo-Saxon” lenders which many on the continent still blame for bringing crisis to European shores back in 2009…In the aftermath of the last financial crisis, the UK had its fingers burnt over the EU’s decision to press ahead with a controversial banker bonus cap in 2012. …Other British battlegrounds include the much-resented Financial Transactions Tax, a radical attempt to impose a single levy on Europe’s financial sector. This was initially vetoed by the UK at the EU level, but is still being pursued by a group of euro states.” In other words, far from being hamstrung from taking action by the non-cooperation of other countries, the UK is the leading saboteur of any attempts to make the financial sector more accountable.
But of course, this is only natural. For accountability would bring the whole criminal enterprise crashing down.

11.06.17
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The ‘spider’s web’: Britain’s global money laundering network

This article was originally published in Counterpunch magazine in June 2016

Kwame Nkrumah was the leader of the Ghanaian independence movement in the 1950s, eventually leading the country to become the first black African nation to break free from British rule in 1957. But Nkrumah knew that the country he led remained tied into a colonial world economy, and would require much more than formal political independence to become truly liberated. He analysed the condition of political independence combined with economic dependence as ‘neocolonialism’ which, he argued, aimed “to keep [living] standards depressed” in the formerly colonized countries “in the interest of the developed countries” and to preserve “the colonial pattern of commerce and industry”. Specifically he noted “the financial power of the developed countries being used in such a way as to impoverish the less developed.” This short sentence describes precisely the main role of today’s global network of tax havens.
Whilst there is no single, internationally-agreed, definition of exactly what constitutes a tax haven, there is little disagreement on the broad contours of their appeal: the chance for capital to escape the regulation, scrutiny and tax laws of the society in which it was generated. Their scale and significance to the global economy is hard to overstate: according to Ronen Palan, one of the leading academic authorities on ‘offshore’ finance, tax havens hold an estimated 20% of all private wealth, process almost half the world’s stock of money, conduct 80% of international financial transactions and account for almost 100% of foreign exchange transactions (worth $2 trillion per day). It is not surprising, then, that 99 of Europe’s top 100 companies have subsidiaries in tax havens. As the investigative journalist Nicholas Shaxson has commented, “the offshore system is not just a colourful outgrowth of the global economy, but instead lies right at its centre”. But this has not always been the case. Whilst early tax havens began to take shape in the 1930s, their emergence as the world’s major financial centres coincided precisely with the end of (most) formal colonialism.
Whilst most of the British Empire had gained independence by the end of the 1960s, Britain retained control of a significant number of island outposts scattered around the globe. Some of these, such as the Chagos and Falkland islands, became outposts for the projection of military power. The Chagos islands, for example, were emptied of their indigenous populations and turned into a US base which has played a crucial role in the refueling of bomber jets on their way to the Middle East, as well as a staging post in the CIA’s notorious rendition programme. But most of the islands were destined for another, although linked, purpose: to act as financial vehicles for the continued looting of the former colonial regions, channeling their resources back to the imperial heartlands. Closest to home were the three Crown Dependencies of Jersey, Guernsey and the Isle of Man; then the fourteen Overseas Territories, mostly in the Caribbean; and finally a range of other jurisdictions such as Gibraltar and Hong Kong. Virtually all of these islands had become tax havens within years of the formal decolonization of the rest of the empire, and collectively represent around one half of all the world’s tax havens (however defined) today. With the exception of Hong Kong, all remain under the control of the British crown, with governor-generals appointed by London, and legislation subject to approval or veto by the British Foreign Office.
Once established, Britain’s network of tax havens created the competitive pressures that led other global powers to create their own offshore centres in response. As noted by Palan, Murphy and Chavagneux, “the British state and the British Empire emerged as the second [after Switzerland] and soon the dominant hub of the offshore economy…A City of London-centred economy emerged, closely linked to a satellite system of British dependencies. The British Empire economy combined tax avoidance and evasion with regulatory avoidance in a new synthesis known as OFCs [Offshore Financial Centres]. The powerful attraction of this London-centred offshore economy forced both the United States and Japan to develop their own limited version of OFCs, adopting a model originally designed in Singapore”. As Shaxson has noted, “It was Africa’s curse that its countries gained independence at precisely the same time as purpose-built offshore warehouses for loot properly started to emerge…The colonial powers left, but quietly left the mechanisms for exploitation in place”.
The main way in which tax havens drain the resources of the developing world is through their facilitation of illicit capital flight. Whilst this affects all countries, as Palan et al explain, “unlike illicit flows of money between developed countries, which tend to be multilateral (eg Swiss firms transfer illicit money to the United States, and US firms transfer money to Switzerland)…flows [from developing countries] tend to be one-directional, from the developing to the developed, from the poor to the rich”, with an estimated “80-90% of all illicit money transfers from the developing countries” thought to be “permanent outward transfers”. The result is illicit flows of $1.25 trillion per year out of developing countries, according to a 2008 report by Global Financial Integrity, ten times the total aid sent to the developing world. Palan and his colleagues note that “these sums are much larger than all other deleterious effects of development, including the transfers identified by traditional dependency theory”. 
 
According to Raymond Baker of Global Financial Integrity, fraudulent transfer pricing accounts for around two thirds of these illicit flows. This occurs when subsidiaries of multinational corporations either over-charge or under-charge another of their subsidiaries to avoid tax. An Exxon copper mine in Chile, for example, raised eyebrows in 2002 when it was sold for $1.8billion, despite being lumbered with $500 million debt and having been, at least on paper, consistently loss-making for the previous 23 years. What emerged is that the entire profits of the mine had been swallowed up in interest payments on a loan that had been taken out with Exxon’s Bermuda subsidiary. Thus the Bermuda subsidiary was making all the profit – tax free – whilst the mine itself was officially loss making, and did not pay a penny of tax to the Chilean government for the entirety of its existence. With one exception, this practice was being used by every single mining enterprise in the country. Given that 60% of all global trade is composed of such ‘intra-firm’ trade, and such deliberate mispricing appears to be the industry standard, this constitutes a massive drain of wealth: research by Christian Aid suggests that developing countries lose $160 billion per year to such practices. If these revenues were collected as tax and spent on healthcare in the same proportions as they have been since 2000, they note, this money would save the lives of 1000 under-fives per day. These practices are facilitated primarily by tax havens. 
The second largest form of illicit money flows from developing countries, constituting 30-35% of the total, is money from criminal enterprises. The secrecy provided by tax havens – which makes it nearly impossible to trace the owners of companies – along with the willful disinterest in how funds were acquired – makes tax havens a magnet for criminal funds seeking a ‘laundering’ service to clean dirty money.
Finally, an estimated 3% of the illicit money flows comes from government officials involved in theft and bribery. Whilst small as an overall proportion, however, such flows have had major consequences, as much of the money was stolen from international loans, leaving the public on the hook for ever-growing, and ultimately unpayable, debts. A major study of 30 African countries by Boyce and Ndikumana in 2003 found that for every $1 lent to Africa between 1970 and 1996, up to 80 cents flowed out of the country as capital flight within a year, often stashed away in the private bank accounts of corrupt leaders in tax havens. A further study of 33 African countries revealed that over $700 billion had fled the continent between 1970 and 2008, amounting to $944 billion including imputed interest. This dwarfs the total African foreign debt of $177bn, making Africa a net creditor to the rest of the world, by a huge margin (of $767billion). But whereas the wealth is held in private offshore bank accounts, the debt is owed by the population, with interest payments reaching $20 billion per year in 2006. Boyce and Ndikumana argue that such payments “represent the third and final act in the tragedy of debt-fuelled capital flight. In the first two acts – foreign borrowing in the name of the public, and diversion of part or all of the money into private assets abroad – there is no net loss of capital from Africa. What comes in simply goes back out again. It is when African countries start to repay these debts that the resource drain begins”. The authors have calculated that, by diverting public funds away from healthcare and towards debt repayments, “debt fuelled capital flight resulted in an extra 77,000 infant deaths per year”, not to mention deaths amongst other age groups, and losses to every other part of the public sector. Tax havens, by providing the facilities by which stolen money could be hidden and stored, have played a major role in facilitating debt-fuelled capital flight.
Not even the tax havens themselves appear to benefit. Despite the hundreds of billions passing through the Pacific tax havens each year, for example, they “remain among the poorest nations in the world” (Palan, Murphy and Chavagneux). And the Cayman islands – the world’s fifth largest financial centre, hosting 80,000 registered companies and holding $1.9 trillion in deposits, does not even provide subsistence to its population; the island’s budget for 2004-5 had as an objective that all residents should achieve at least subsistence levels of income – an astonishing admission for what is, on paper, one of the world’s richest countries per capita, with a population smaller than a typical English village. 
So, through transfer mispricing, money laundering, debt-fuelled capital flight and straightforward tax evasion, tax havens are facilitating the draining of over $1 trillion per year from developing countries. But once that money arrives in the tax havens, it doesn’t typically stay there. As Martyn Scriven, secretary of the Jersey Banker’s Association, explained to Nicholas Shaxson: “We gather deposits from wealthy folk all around the world, and the bulk of those deposits are sent to London. The banks consolidate their balances every day, and surplus funds won’t sit here – they either go to another bank or on and through to the City. If I have money to spare, I pass it to the father. Great dollops of money go into London from here”. Indeed, according to a recent UK Treasury report, “the UK has consistently been the net recipient of funds flowing through the banking system from the nine jurisdictions” covered in the report (six of the UK’s overseas territories plus its three crown dependencies, all of them tax havens). In particular, “The Crown Dependencies make a significant contribution to the liquidity of the UK market. Together, they provided net financing to UK banks of $332.5 billion in the second quarter of calendar year 2009, largely accounted for by the ’up-streaming’ to the UK head office of deposits collected by UK banks in the Crown Dependencies.” The report explains that “‘Up-streaming’ allows deposits to be gathered by subsidiaries or branches in a number of
different jurisdictions and then concentrated in one centre, in this case the UK, where the bank
has the necessary infrastructure to manage and invest these funds. This model is followed by
many large banks around the world and is not confined to ‘British’ jurisdictions”. 
 
In other words, the US and British banks use tax havens to gather wealth from all over the world using unregulated subsidiaries in tax havens, and then channel that money to their parent companies in London and New York. The UK report concludes that “in aggregate, the UK was a net recipient of funds from the nine jurisdictions of $257 billion at end-June 2009”, conforming to “the long-standing pattern that the UK has consistently been a net recipient of funds.” As Shaxson put it, the British-controlled tax havens “scattered across the world capture passing foreign business and channel it to London just as a spider’s web catches insects”. But this web also acts as “a money-laundering filter that lets the City get involved in dirty business whilst providing it with enough distance to maintain plausible deniability… By the time the money gets to London, often via intermediary jurisdictions, it has been washed clean”.
And once it gets to London or New York, it is pretty safe – the US success rate in catching criminal money, for example, is estimated by Global Financial Integrity to be around 0.1%. No wonder that Baker calls this system, ‘the ugliest chapter in global economic affairs since slavery’. For Shaxson, “the offshore world is not a bunch of independent states exercising their sovereign rights to set their laws and tax systems as they see fit. It is a set of networks of influence controlled by the world’s major powers, notably Britain and the United States”; and even the UK Treasury admits “the UK’s responsibility for representing their [the Overseas Territories and Crown Dependencies] interests in international fora”. 
Just as under formal colonialism, of course – and as Western media loves to point out – there are certainly also beneficiaries of tax havens in the global South. The ruling elites who have plundered their own countries and stashed the money abroad, from Mobutu in the Congo, to Marcos in the Philippines, Abacha in Nigeria and countless others, have become some of the world’s wealthiest people thanks to the ‘no-questions’ storage and laundering services provided by tax havens. Neocolonialism, as colonialism before it, has always relied on its indigenous collaborators. 
 
Likewise, there are also big losers from the tax haven system in the global North. Richard Murphy has estimated that £25 billion per year in tax revenues are lost to tax havens from the UK alone, and Shaxson notes that one third of Britain’s largest companies pay no tax at all. Furthermore, all countries, including the richest, have been forced to compete with tax havens by emulating some of their deregulated and low tax features in order to avoid capital flight offshore, with the result that, in Shaxson’s words, “in the large economies tax burdens are being shifted away from mobile capital and corporations and onto the shoulders of ordinary folk”. He adds that “overall, taxes have not generally declined [in the US]. What has happened instead is that the rich have been paying less, and everyone else has had to take up the slack”.
Nevertheless, what is beyond doubt is that the damage inflicted on developing countries by tax havens, in terms of world historic levels of capital flight, and measured in the deaths of literally hundreds of thousands of men, women and children is simply incomparable with the side effects suffered by the developed world. Equally incontrovertible is that it is the predominantly Western banks and multinational corporations that are the biggest winners from the explosion of offshore, as demonstrated by the net flows into US and UK-based institutions – institutions, that is, on which a massive and increasing proportion of Western citizens depend for their pensions.
This short essay has, by its nature, many omissions, barely scratching the surface of the mechanisms used by tax havens to drain the resources of the developing world. Neglected, for example, were the issue of double (non)-taxation; the role of offshore in creating financial crises in which developing countries suffer disproportionately (and following which Western corporations buy up bankrupted companies at far below their real value); and the crucial role of under-development itself in boosting Western profits, firstly by keeping third world wages low, and secondly by maintaining the West’s monopoly of hi-tech industry. Nevertheless, it has shown that whilst all countries are impacted by the tax losses, capital flight and illicit transfers facilitated by tax havens, it is the developing world which suffers the most inhuman consequences by a large margin; and at the same time, the net flows into London from its string of tax havens dwarf overall UK tax losses by a factor of around ten. Whilst I have not seen comparative figures for New York, I have no reason to disbelieve the UK Treasury’s claim that a similar pattern is at work. What is clear is that the US and UK, the world’s foremost neocolonial powers, are net (and huge) beneficiaries of the offshore system, relying on a string of ‘offshore’ territories over which they have effective control (places such as Panama in the case of the US) to provide ‘arms length’ banking services it would be politically difficult to provide at home. Nkrumah claims that “Neo-colonialism is…the worst form of imperialism. For those who practice it, it means power without responsibility and for those who suffer from it, it means exploitation without redress”. It would be hard to find a more precise example of this than in today’s empire of tax havens.
11.03.17
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Yemen’s peace talks failed because the aggressors wanted them to fail

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This article was originally published in June 2015 in Middle East Eye.

The Yemen peace talks in Geneva broke down last week before they even got underway – indeed, the delegations never even made it into the same room, let alone reaching an agreement. That this was so came as no great surprise either to observers or participants of the disastrous war in Yemen. But in all the talk of ‘mutual recriminations’ and ‘intransigence on both sides’, it is important not to lose sight of the fact that these talks failed because the aggressors – that is, the Saudi-led and British-US sponsored ‘coalition’ bombing the country – wanted them to fail.

The central fact is that the ceasefire proposed by UN Secretary-general Ban-Ki Moon – a basic condition for peace talks everywhere – was blocked by the Saudis. The Houthis, naturally enough, refused to negotiate whilst the Saudis were still bombing. The Saudis refused to stop bombing until the Houthis withdrew from all the cities they captured during the war. In other words, whilst the Houthis sought a mutual ceasefire, the Saudis demanded nothing less than abject surrender as the precondition for negotiations. Given that the Houthis have suffered very few territorial losses since the Saudis began bombing in March, this was obviously never going to happen.

The Saudis’ Yemeni allies – forces loyal to exiled President Hadi (who came to power in 2012 following an election in which he was the sole candidate) – clearly shared their backers’ bad faith in relation to the talks. As Medhat al-Zahedwrites in Al Ahram Weekly:

“In response to Ki-moon’s appeal for a two-week humanitarian truce on the occasion of the Holy Month of Ramadan, the Yemeni government in exile adopted a far from conciliatory tone. Ramadan was a month for jihad and did not require the fighting to stop, the foreign minister said …Opposition to a truce was stronger still from Ahmed Al-Masiri, the leader of the Southern Resistance forces that are fighting the Houthis and regiments from the Yemeni army loyal to former president Ali Abdullah Saleh on the ground… He rejected the idea of a humanitarian truce, saying it was “out of the question during Ramadan and after Ramadan”. “Ramadan is a holy month in which jihad is permissible,” he said…The conference got off to a heated start, with the Yemeni delegation brandishing Riyadh-inspired slogans. “We came to speak about implementing the UN Security Council Resolution, not to negotiate,” it said. “The task is to reinstate the government and withdraw the militias.” The rigidity of the Yemeni government and its Saudi backer stems from the fact that they have opposed the negotiations from the outset. They have insisted on the term “consultation” and originally pushed for Riyadh as the venue. “We agreed [to come to Geneva] to please the UN, so that they don’t say we are against peace or that we are stubborn,” Al-Masiri said.”

The anti-Houthi side, in other words, had no intention of either negotiating or accepting a ceasefire themselves, but went to Geneva simply to allow the ongoing war to be spun in such a way that places the blame solely on the Houthis.

In fact, this deliberate scuppering of any chance of a negotiated settlement in favour of continued war and chaos mirrors precisely the start of the Saudi bombing campaign itself. A month after the bombing began, it was revealed that “Operation Decisive Storm” had been initiated just as Yemen’s warring parties were on the verge of signing a power-sharing agreement that could have ended the country’s civil war. As Jamestown Foundation noted: “According to the former UN Special Adviser on Yemen, Jamal Benomar, negotiations between all major stakeholders in Yemen were nearing an interim conclusion on a power sharing agreement when Saudi Arabia and its allies launched Operation Decisive Storm on March 25 (Wall Street Journal, April 26). Despite the Houthis’ push into south Yemen, representatives from the south remained engaged in negotiations. The commencement of aerial strikes by Saudi Arabia and its partners ended the negotiations and led to a dramatic escalation of violence between the Houthis and southern militias, who, with the support of Saudi Arabia, were determined to reverse the gains made in the south by the Houthis and their allies.”

The question, then, is ‘why’? Why would Saudi Arabia gratuitously extend a destabilising war on their own Southern border – and continue to do so even when it had become thoroughly apparent that their ‘Decisive’ Storm was anything but?

The answer is not simply that they want to prevent ‘Shia’ influence in Yemen’s government, as is often claimed – as if it is self-evident that a ‘Sunni’ government would be against a ‘Shia’ one. This analysis is typical of the way in which orientalist Western journalism continues to attempt to ‘naturalise’ and reify religious and ethnic divisions in a way that suggests that sectarian intolerance is somehow in the DNA of non-Europeans. In fact, the ‘Sunni’ Saudi rulers have happily supported a Yemeni ‘Shia’ movement in the past – the forerunners of the Houthis no less – in the 1960s when the Zaydi Shia royalty was under threat from an Egyptian-backed republican movement: a conflict in which the Sunni Saudis and Shia Iran were on the same side. The Saudi involvement in Yemen is not about some kind of age-old sectarian identity – it is about strategy, a specific strategy that is in fact very new, dating back to the middle of the last decade, when the Saudi-Israeli-US-British alliance decided to channel billions of dollars into sectarian death squads that would be unleashed against the growing resistance axis spearheaded by Iran, Syria, and Hezbollah. The Houthis, by threatening the regional base of one of the most powerful of these groups – Al Qaeda in the Arab Peninsula – were a threat to this strategy. The chaos arising from the Saudi intervention, meanwhile, has provided the perfect conditions for its spread.

 

11.03.17
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Yemen and Britain’s deep-seated culture of duplicity and lying

Image result for the history thieves

This piece was originally published in August 2017 in Middle East Eye. 

Last Thursday was the last day of the current UK parliamentary session, before its summer recess. This made it the date for a particularly obnoxious new British tradition called ‘take out the trash day’. The UK government is obliged to issue all its public reports before the end of the parliamentary year; but to avoid scrutiny from MPs, the government now regularly withholds any potentially embarrassing reports until the very last day of that session. Then it can release them safe in the knowledge that there will be no time left for MPs to examine them, and no opportunity to question ministers over them.

So having issued very little information over the preceding weeks, once MPs were heading back to their constituencies, the government took the opportunity to releasedozens of reports and ministerial statements detailing everything from cuts to police, to the revolving door between cabinet ministers and private corporations, to the millions in legal fees the government spent attempting to prevent parliamentary scrutiny of Brexit. Buried deep amongst them was a Foreign Office report on the state of human rights in 30 countries deemed to be of ‘priority concern’. What makes the report embarrassing to Britain, however, is that 20 of these countries are major customers of British arms exports; with Saudi Arabia, of course, topping the list. The Saudis, whose mass executions, public lashings and restrictions on women’s rights are all detailed in the report, increased their UK weapons purchases from Britain by 11,000% following the start of their bombing campaign against Yemen in March 2015, and have purchased more than £3.3billion worth since then. Those weapons have played a major role in pushing Yemen to its current catastrophic situation, facing the fastest-growing cholera epidemic since records began, with 7 million people on the verge of famine. No wonder the UK does not want to draw attention to what is being facilitated by its relationship with the Saudis. It is right to be ashamed.

As well as downplaying Saudi atrocities, however, we also learned last Thursday that the UK government has been exaggerating its aid contribution to Yemen. In the most recent Commons debate on Yemen on 5th July, International Development minister Rory Stewart gave a figure he had inflated by 30%; his department used ‘take out the trash day’ to issue a correction to that figure, presumably expecting that no one would notice. In that, they seem to have been correct; I have been unable to find a single press report mentioning it. But perhaps lying to parliament about Yemen no longer qualifies as news – after all, it seems to have become standard practice for ministers.

By early 2016, with atrocities mounting in Yemen – such as airstrikes against three Medicins Sans Frontiers hospitals in as many months – some MPs began challenging the government’s policy, concerned in particular that British weapons were being used to carry out war crimes. Every time he was questioned on the issue, however, then-UK Foreign Secretary Phillip Hammond insisted, in the face of copious evidence, that “we have assessed there has not been a breach of international humanitarian law by the coalition”. This claim, or variations of it, was repeated by ministers to parliament six times. But then, on ‘take out the trash day’ 2016, the Foreign Office effectively admitted that it had been a lie.  What Hammond should have said, said the FCO in the six ‘corrections’ they issued, was that “we have not assessed that there has been a breach of international humanitarian law by the coalition”. And that was because such an assessment – an assessment the government had been claiming all year to have carried out and which exonerated the Saudis – had never been made.

Britain is up to its neck in Yemen: it is the major supplier of the bombs dropped on Yemen, and of the jets used to drop them; it provides diplomatic cover to the Saudis (such as repeatedly blocking an independent investigation into Saudi war crimes); it supports the starvation blockade of the country; it provides training and logistical assistance to the Saudi armed forces; and it has 125 soldiers stationed in Saudi Arabia, including six officers based in the Saudi command and control HQ‘assisting with target selection’. Indeed, Britain may well have officers embedded in the Saudi army itself, given 2015’s ‘take out the trash day’ admission that Britain has 177 military personnel embedded within the armed forces of several other, undisclosed, countries. Yet ministers continue to lie to parliament that Britain is ‘not a party’ to the war in Yemen. As Mark Curtis has noted, this line was even repeated on the very day the British government disclosed that the Saudis used five different types of British bombs and missiles on Yemen.

The brazenness of the UK’s lies about its role in Yemen is underpinned by a tight secrecy which it hopes will prevent most of its duplicity ever being discovered.

Britain’s relations with Saudi Arabia have always been kept as obscure as possible, with the government regularly suppressing its own investigations and reports into the matter; the current refusal to release a Home Office report on terrorism funding lest it embarrass the Saudi and British governments has many precedents. In 2006, Tony Blair personally shut down the Serious Fraud Office investigation into a billion-pound bribery case involving British Aerospace and a Saudi prince, on the grounds it could endanger ‘national security’. And in 2014 Theresa May signed a secret ‘memorandum of understanding’ with Saudi Crown Prince Mohamed bin Nayaf which the UK has consistently refused to make public. This was just months before the British-Saudi war on Yemen was unleashed.

Secrecy surrounds every aspect of Britain’s Yemen operation. It was the Saudi foreign minister, not the UK, who admitted to the stationing of British officers in his country’s command and control centre. The government has refused to provide details of its export licences to Saudi Arabia. And the government informed neither public nor parliament of its decision to send the Royal Navy’s most advanced warship, HMS Daring, to the coast of Yemen last November, essentially to help shore up the blockade.

When the truth does come out, government ministers see it as their job to try to rubbish it; Middle East minister Tobias Ellwood, for example, responded to a UN report documenting more than 100 coalition airstrikes which violated international law by claiming they had been either “mistakes” by the Saudis or, astoundingly, that they had been “fabricated” by the “media-savvy” Houthis.

But, as Ian Cobain has thoroughly documented in “The History Thieves: Secrets, lies and the shaping of a modern nation”, this culture of secrecy and deception is deeply-rooted in British political life – and nowhere more to than the Foreign Office.

In 2001, a group of elderly Kenyans began the process of taking the British government to court over their treatment. All of them alleged that they had been tortured by the British during the Mau-Mau rebellion of the 1950s. Writes Ian Cobain, “If the old people were telling the truth, hundreds of thousands of Kikuyu, the country’s largest ethnic group, had been incarcerated by the colonial government, abused, tortured, and not infrequently raped… [Jailers] had beaten inmates to death, and even burned men alive”. Yet the official documentation in Kenya seemed to be almost entirely lacking in anything covering the treatment of prisoners – and when the judge in the trial ordered the Foreign Office to disclose all relevants, they claimed they had nothing other than what was already held in the Kenyan archives. This was strange, as the colonial authorities had been meticulous record-keepers. Someone, it seemed, was not telling the truth.

Stories had long circulated of huge wooden crates being removed from the Kenyan archives to be flown to Gatwick nine days before independence. And then, during the trial, Oxford historian David Anderson introduced a 40-year old Foreign Office minute which suggested the Foreign Office were withholding around 1500 files on Kenyan which had never been disclosed. That was when the Foreign Office came clean. They had lied about not holding any relevant files; in fact, they finally admitted, they were indeed holding 1500 files on the last days of British rule in Kenya. Once these were handed over, they immediately corroborated all the Kenyans’ allegations; as Cobain wrote, the files “detailed the way in which suspected insurgents had been beaten to death, burned alive, raped, castrated – like two of the High Court claimants – and kept in manacles for years. Even children had been killed.” The government settled the case and paid £20million compensation to 5,228 claimants.

The case had led to the discovery of an epic cover-up. For it soon emerged that it was not only Kenya from where documents had been secretly removed. Following a instruction issued by the British colonial secretary Iain Macleod on 3rd May 1961, a massive operation of file-destroying and removal had been initiated across the entire British Empire. All files that could potentially embarrass the British government were ordered to be destroyed or removed to London – and almost 9000 such files, the government admitted in 2011, from 37 former colonies, were still being secretly held in Hanslope Park, 40 miles North of London. The government said it would clear the files for declassification and transfer to the national archives, and appointed Cambridge historian Tony Badger to oversee the process. He established that the true number of secret files was in fact more than 20,000. Yet even these ‘purged’ files had clearly themselves been purged. The Yemen files were particularly thin on the ground: Aden, which had seen a four-year long rebellion repressed with vicious brutality immediately prior to independence, had just five boxes. And when these were opened, writes Cobain, “it was found that half the files inside were personnel records of law ranking officials, while most of the remaining papers concerned agriculture”. This was not surprising, given what we now know from British civil servants in Aden, who have described what one called an “orgy of burning”. The files sent to London were, he wrote, “severely weeded”, such that “details of tribal affrays, secret counter-insurgency operations funded out of the coded-worded money bags…and many examples of less sensitive ‘keeni meeni’ are all gone, and are not duplicated elsewhere”. Keeni Meeni is the Swahili term for the ‘slithering of a snake’. It is an apt description for this entire episode of empire white-washing, indeed, for the whole operation of British imperialism, both then and now.
In truth, British foreign policy has always been a matter decided behind closed doors, with public and parliament informed as little as possible, and consulted even less. Cobain explains how Britain’s eleven-year war in Oman, begun in 1965, was not even publicly admitted until 1972, with ministers lying about the situation to parliament almost compulsively, and journalists barred from entering the country at all. He also notes how Britain’s unique system of media self-censorship – enforced by the infamous D notice committee – which covers almost all aspects of war reporting, today results in an estimated 80-90% of all relevant news reports being submitted to the committee before publication. This is an amazing level of government control of information about its wars, covert or otherwise. Moreover, we now know that the 20,000 secret files from ‘Operation Legacy’ were but the tip of the iceberg: the Foreign Office is, it has recently been discovered, actually holding at least 170,000, and possibly up to 1.2 million secret files, dating back to 1662 and taking up 15 miles of floor-to-ceiling shelving. The Foreign Office has clearly never considered itself to be bound by the various Public Records Acts which supposedly make official documents accessible to all. In 1971, former Cabinet minister Richard Crossman claimed that “secretiveness is the real English disease and in particular the chronic ailment of British government” – and that it “ensures that the House of Commons is the worst informed legislature in the world”. Today’s war in Yemen shows he remains dismally right.