A worthwhile read; an excerpt:

Globalization’s advocates – and they are very many, including all the varied categories of worthies on both sides of the Atlantic and beyond who preside over almost all respectable academic institutions and elite gatherings – habitually celebrate its transfer of income from higher-income to lower-income countries while disregarding the overwhelming evidence that much of that consists of the transfer of income from lower-income people in higher-income countries to higher-income people in lower-income countries. When I presented overwhelming statistical evidence to that effect (in The Endangered American Dream, 1993, andTurbo-capitalism, 1999), Robert Solow in the New York Review of Books and Paul Krugman in a purpose-written little book attacked me as a simple-minded xenophobe, a sort of proto-Trump, who had no clue about the wonders of comparative advantage in ensuring the best possible economic outcome for everyone.

Less polemical economists did in due course pay attention to the evidence of rising inequality in the more developed economies (yes, even in ever so virtuous Norway and such), but they then explained it as very largely the result of the information technology revolution, which continues to devalue all forms of routine work in both production and distribution, as opposed to the globalization-caused decline in advanced-country manufacturing that drives once well-paid production workers into low-paid services. Others disagreed of course – but actually nobody of political consequence paid any attention. That remained so even after Thomas Piketty’s Capital in the Twenty-first Century became the Harvard University Press all-time bestseller in 2014 – and not because of that book’s shortcomings (now expertly re-examined in the current issue of Commentaire by André Babeau, Denis Kessler, Didier Maillard and Gilles Saint-Paul). It was just that national and international liberal elites are perpetually focused on “north–south” inequalities, never in internal advanced-country inequalities: hence the horrible electoral surprises of 2016, when in the US the victims of globalization found their candidates in Donald Trump on one side and Bernie Sanders on the other, while their British counterparts won their Brexit. That referendum has evoked shamelessly anti-democratic and madly over-the-top reactions from the princes of the international elite; Mario Monti, himself an unelected Italian Senator for life (on €147,000 per year) and unelected ex-Prime Minister (with a nice pension) as well as an ex-EU commissioner of note, loudly proclaimed the Brexit vote itself to be an abuse of democracy.

This is the context that makes The Panama Papers so very important. With this totally new evidence in hand, we now know that globalization has caused rising inequality in quite another way than the transfer of higher-paying manufacturing jobs and all other such phen­omena – very unfortunate in my view but not shameful or criminal. It is just a matter of numbers: Mossack Fonseca’s 214,000 offshore companies alone (and there are many other such shell companies, formed by many other law firms) handled not millions or billions but trillions of dollars in their totality, thereby wholly subverting the presumptively equalizing effect of taxation. When the less affluent must pay their payroll taxes and income taxes in full, while the more affluent with offshore companies do not pay their own taxes, the total effect of the taxation system is regressive, even without adding the inherently regressive effects of sales and value-added taxes. Once we recognize the sheer magnitude of “offshored” income flows, and once we take into account the strongly regressive effects of supposedly progressive taxation systems, the phenomenon of rising inequality in affluent societies may not need much additional explaining – and it hardly matters if those were tax-avoidance or tax-evasion trillions.