Thomas More Institute

In recent weeks, newspapers and media at large have been speaking about the biggest leak in contemporary history. The Panama Papers amount to 2.6 terabytes of information or 11.5 million documents on offshore tax havens. The records constitute the internal database of Mossack Fonseca, a Panama-based law firm, and were published by the International Consortium of Investigative Journalists. These documents implicate high-profile individuals – including 143 politicians – in large-scale tax avoidance.

Whilst not in itself illegal, the use of offshore structures raises important ethical questions. In a continent, Europe, where austerity has held sway for a number of years and where ordinary people have had to make financial sacrifices in order to keep sovereign states financially soluble, the fact that political elites are resorting to tax-dodging schemes seems like a shocking slap in the face. Financial opacity, big corporations and politicians form an explosive trio that challenges the realm of public morality within which it is hoped that leadership should operate.

Cases such as this undermine public trust in political figures, and further widen the gap between the people and their representatives. Both Labour and Conservative MPs, like Carolyn Flint and Jacob Rees-Mogg, called for the publication of politicians’ tax affairs. It is essential to make sure that those who govern are as transparent as possible about that which may hinder their defence of national interests. Only thus can a coherent global financial governance arise and political life will once more be informed by ethical judgement.

Yet, it is also important to ensure that demands for transparency do not turn into a form of political witch-hunt. Some equilibrium between privacy and accountability must somehow be found, so that public trust may be restored without scapegoating or the endangering of individuals’ rights. Clear as it may be that a renewal of political openness is much needed nowadays, the public ought at the same time to acknowledge the limits of its claims when challenging political authority.