Other than being small Caribbean countries, what do Panama and Antigua have most prominently in common? Trade wonks will know there's a stalled U.S.-Panama FTA hungover from the bad old Bush years, and that Antigua's case challenging the U.S.'s right to set our own gambling policy give them that common thread. But what else?
If you answered "setting of huge banking scandal", you're right!
Gazillionaire financier Bernie Madoff Allen Stanford has been all over the headlines for an $8 Billion fraud scheme (yes that's a 'B'...) that rocked several Caribbean and Latin American countries, including Panama and Antigua. As the New York Times reports on the scandal and its impact on other popular offshore banking destinations:
Panama's strict banking secrecy laws make it a well known tax haven and popular destination for money laundering of all sorts. During the Stanford manhunt, one financial press blogger betrayed the truth, that "of course" Panama would be implicated in a Caribbean financial scandal:
You'd hope the U.S. government will be smarter than Stanford - who despite what the blogger notes about the ease for him to hide abroad was caught on U.S. soil last week. The guvs can prove they are smarter by doing away with Bush's hangover Panama FTA, which would do nothing to ensure that the rich pay their fair share of taxes as we invest hundreds of billions in American recovery. Even worse, the Panama FTA could potentially allow corporations and the wealthy to escape the regulations that will be needed to avoid the next financial crisis - deregulation having gotten us into this economic tailspin in the first place.
The Antigua case is something of a non-sequitur - though it's still crucial that the Obama administration act in the public interest to both resolve that case and get us out of an overreaching WTO agreement on financial services. However, U.S. policymakers still have time to avoid facilitating further fraud by sending the Panama FTA packing.
(Photo used under Creative Commons license courtesy of Flickr user guano)