Reprinted from The Guardian
The massive fallout from the Panama Papers investigation -- the largest leak of documents in history, which has exposed the tax affairs of the world's most powerful people -- is being felt globally. (The investigation has already captured its first head of state, in the Prime Minister of Iceland who resigned on Tuesday.) Yet, so far, the reaction in the US has been muted.
It shouldn't be. While the investigation has not named any well-known US citizens -- though "just wait for what is coming next" as one of the lead editors said -- the scandal should be a critical issue in US presidential election. This is especially true in the Democratic primary, where the story once again calls into question free trade agreements which the party's elite have been pushing on its rank-and-file for years.
What makes this story particularly relevant is that it was partly predicted by presidential candidate Bernie Sanders when the Obama administration signed the Panama free trade agreement in 2011.
At the time, Sanders gave a prescient speech warning of the exact kind of scandal exposed by the Panama Papers. As Congress was debating the deal, Sanders said on the House floor that "Panama is a world leader when it comes to allowing wealthy Americans and large corporations to evade US taxes by stashing their cash in off-shore tax havens. And, the Panama free trade agreement would make this bad situation much worse." (The speech is now going viral on Facebook.)
But with or without the Panama free trade deal, using foreign tax havens to store vast amounts of wealth has been an American tradition for decades. And as Glenn Greenwald wrote, much like the Snowden revelations, the true scandal of the Panama Papers is not what's illegal, but what has been legalized.