OpenLearn Live bridges the gap between free learning and your world. This page will be updated across the day.
Yesterday we offered a quick guide to the Panama Papers - you can catch up with that reading list on yesterday's OLL. The story has developed, so here's some additional pieces to help you understand the story more clearly.
At the LSE's Europp blog, Benjamin Leruth explains how the revelations could lead to victory in Iceland for the Pirate Party:
However, despite Iceland’s economic recovery, the [Sigmundur] Gunnlaugsson government became increasingly unpopular. On top of societal and environmental issues, the government decided to freeze EU accession talks as well as to discontinue the constitutional project. A series of protests took place between late 2014 and 2015 calling for the government to resign. Protestors listed 99 reasons for the government to resign, and a major demonstration was held on 26 May in front of the Parliament.
With the involvement of three ministers in the Panama Papers on top of the existing public discontent, it would be hard for the government to stay in power until the next parliamentary elections, which are scheduled to take place by the end of April 2017. A major public protest was immediately scheduled for 4 April in front of the parliament, and the reaction could be quite similar to the ‘pots and pans revolution’ of 2008-09. Different scenarios are possible, but early elections are extremely likely to take place. These could lead to the formation of a left-wing coalition government led by the Pirate Party, which has topped opinion polls since early 2015. The most recent poll suggests the Pirate Party would get 36.1 per cent of the votes if an election were called, which represents more than the coalition’s Progressive and Independence parties combined.
Since Leruth's opinion piece was published, Birgitta Jonsdottir - an Icelandic MP - called for Sigmundur Gunnlaugsson to stand down, in a piece for The Independent:
On Monday, the largest protest in the history of Iceland took place to protest against the total collapse of ethics among the 1 per cent in Iceland in the wake of the Panama papers scandal. The Prime Minister, Sigmundur Gunnlaugsson, is among those alleged to have misled voters and the nation, by failing to disclose a shell company owned by himself and his wife, and which gave him a seat at both ends of the table in the negotiations over the collapse of the Icelandic banks.
The opposition parties in the Icelandic parliament have put forward a resolution to demand of vote of no confidence towards in the Prime Minister and his cabinet, triggering early elections. This resolution will go into the Parliament’s daily agenda no later than Thursday this week. It is, however, increasingly likely that the Prime Minister will be forced to resign by his cabinet before the motion of no confidence is debated and then voted on.
And since that was published, in the last hour, Sigmundur Gunnlaugsson has stepped down. BBC News reports:
The prime minister of Iceland has resigned - the first major casualty of the Panama Papers leaks which have shed an embarrassing spotlight on the world of offshore finance.
The leaks, from Panama law firm Mossack Fonseca, showed PM Sigmundur Gunnlaugsson owned an offshore company, Wintris, with his wife.
He was accused of concealing millions of dollars worth of family assets.
A big protest was held in front of parliament in Iceland on Monday.
Reports suggest the agriculture minister will be the new PM.
Away from Iceland, the revelations about Russian connections to the tax havens are less likely to have a major effect, says Anastasia Nesvetailova at The Conversation:
Aware that president Vladimir Putin would be linked to offshore schemes, the people around him began their PR manoeuvres ahead of time. The week before the papers were released, the Kremlin was forewarning the public about an imminent “information attack aimed at destabilising Russia in light of its success in Syria”.
The reaction of the Russian individuals mentioned in the Panama Papers – at least those who have gone on record so far – has also been calm. Some have denied knowledge of ownership of any offshore accounts. Considering the way offshore structures operate and set up, is not an implausible proposition.
Nevertheless, that hasn't stopped criticism of the Russian state. In a commentary piece originally from Vox, republished by the European Council on Foreign Relations, Mark Galeotti says The Panama Papers show how corruption really works in Russia:
The real currency in Russia is not money but power — and the latter can buy the former, but not necessarily the other way around. You can be rich today, but the state can impoverish you tomorrow. Conversely, if you have power, you can always get money, as we are likely seeing with the Panama Papers, or else simply don't even need it.
While the Panama Papers involve far more cash, and are likely to draw far more attention, it's the other story that is the more meaningful, for demonstrating that Russia's real currency isn't money — it's power and connections.
The sudden spotlight on South and Central American nations and their links to tax avoidance may prove uncomfortable for that region. Writing for Caribbean News Now, Jessica Cruz, Melanie Landa, and Christopher Razo,
Research Associates at the Council on Hemispheric Affairs say that Latin America has been exposed:
Concerns are high for Latin America not only because the law firm whose files were leaked was based in Panama, but because these files exposed the offshore tax-exempt accounts of a number of Latin American leaders and politicians from all throughout the region.
In Argentina, the recently elected, Mauricio Macri, was associated with the offshore company, Fleg Trading Ltd, which was incorporated in the Bahamas in 1998 and dissolved in January 2009. Macri, however, claims he did not recognize any financial asset ties with the company that would have taken place during his time as mayor of Buenos Aries.
And for Britain? For the editor of OpenDemocracyUK, Adam Ramsay, the revelation is a reminder of what the UK now exists to do:
Because it's hard not to look at the whole affair, and see Britain right at the core of it. Or, at least, the British State, which you might argue is a different thing.
There are, you see, a few important facts we are rarely told about the British State. Like the fact that it is responsible for more land in the Southern Hemisphere than the Northern and for more penguins than any other government, that there are eighteen legislatures under Westminster's wings, and that they include amongst them by far the most important network of tax havens and secrecy areas in the world.
With the City of London at its core, Britain's network of havens from tax, regulation and other pesky laws stretches first to the Crown Dependencies – Mann, Guernsey and Jersey – and then into the British Overseas Territories: the Virgin Islands, Bermuda, the Cayman Islands. From there, this web extends to places like Hong Kong: not under British rule since 1997, but, according to Nicholas Shaxton, still feeding “billions in business to the City”.
Looking at the documents leaked from Mossack Fonseca one thing is clear: Britain's network is once again at the core. More than half of the companies listed in the documents are registered in the UK or its Overseas Territories, and Hong Kong plays a huge role.
Writing just a month ago for OpenLearn, the OU's Peter Bloom explained the basics of tax avoidance - and what we might do to solve the problem:
There are more radical ideas for dealing with this problem. One of the more popular is to directly punish the banks who assist corporations in avoiding taxes. Huge banks continue to serve as attractive places for companies to place their money to pay less taxes. They also create financial mechanisms such as the ‘Interest Rate Swaps’ and ‘Trade Return Swaps’ to evade taxes. Governments are for this reason increasingly seeking to reduce the role of banks because of their contribution to this problem. In doing so they are revealing their willingness to potentially not only punish businesses but all those who help facilitate tax noncompliance.
Others have advocated for a more global solution. Whereas recognising that tax avoidance is technically legal, they point out that it is the poor who most suffer from its effects. Further, these avoidances take precious resources from projects and services vital to a country’s welfare and development. These conditions can threaten other countries because of problems of economic migration and political instability. For this reason, it is far from a national problem. Consequently, there is a rising call for international organizations such as the United Nations to play a direct role in dealing with this issue.
In the current New Scientist, Robin Murphy talks about using robots to save drowning refugees:
When we heard about refugees drowning off the coast of Greece we called Tony Mulligan, CEO of a company called Hydronalix, which makes remote-controlled lifeguarding marine robots called EMILYs. He said, “I will take two experts and two EMILYs to Greece.” I met him out there in January. He donated the robots, one to the Hellenic Coast Guard and one to the Hellenic Red Cross.
This week, we're digging about in the dumpster of the forgotten digital world - ideas which didn't work, or were outstripped, or simply faded away. Yesterday, we blew the dust of an Apple Newton. Today, we're turning our attention to The Daily.
Rupert Murdoch hasn't always given the impression of being at ease with news shifting online. The erecting, and then awkward dismantling of, The Sun paywall and the attempts to stop Google indexing his news content could be seen, to adapt a famous headline, as evidence of Old Man Yells At Cloud Servers. A more charitable interpretation would be that he's a businessman trying to find ways to protect a business which once was hugely profitable, and now looks merely expensive.
The launch of The Daily fits more closely into that second interpretation.
Murdoch wasn't the first person to launch an online newspaper - but most of these are just news-driven websites with names chosen to sound like a legacy print product. The Daily was to be a different beast from The Daily Beast.
With only a limited website, The Daily would be delivered to people's iPads on a pattern which mimiced the cycle of a print newspaper. The polar opposite to the old BBC News Online slogan 'updated every second of every day', The Daily was going to update once a day. The Week reported the plan:
The Daily has a very newspaper-like feel. Each edition will consist of six sections and appears daily in time for breakfast. Although the product will have its own website, it is expected to feature only a small percentage of the content that subscribers see on their iPads.
And this wasn't a timid, toe-dipping exercise - the paper was given 100 journalists. It had heavy investment behind it, and the boss himself handled launch duties:
The first edition was pushed out on February 2nd, 2011. And, as The Guardian review explained, while the publishing cycle was a throwback to the days of hot metal, in every other sense The Daily was embracing the world of digital:
So what does an iPad newspaper feel like? The answer is "not much like a newspaper".
Instead, the Daily feels much more like one of the better examples of an iPad magazine, along the lines of Wired or Virgin's Project. Despite the fact that both publications are ultimately owned by the same company, the Daily is nothing like the Times's iPad app, as there's little attempt to replicate much of the look, feel or tone of a traditional print newspaper.
This means there's plenty of video, both in stories and the ads that are strewn through the Daily. In some cases, rather than use ordinary photographs, there are 360-degree panoramic shots that you can swipe around. Sometimes these videos and panoramas feel gimmicky, but occasionally they work well.
The other important thing to note about The Daily was that - in order to repay that investment - it was going to charge. And that's probably the main reason why we're talking about it in the past tense. The digital paper didn't find an audience - not a large enough one, anyway - in order to make the maths work. Jeff Jarvis ran through his estimates:
When it started, I calculated that The Daily would need to net at least 750,000 subscriptions – 1m when accounting for cancellations (aka "churn") – to break even on an operating basis, what with a share of sales going to Apple on the iPad. Murdoch promised he would sell "millions." In the end, it reached 100,000 subscribers, not nearly enough to compensate for a reported $30m in development cost and $500,000 per week burn rate.
Or, as Rupert Murdoch put it:
"[The Daily] could not find a large enough audience quickly enough to convince us the business model was sustainable in the long-term."
NPR's media correspondent David Folkenflik suggested that the decision to focus almost entirely on content-within-an-app might have been a problem:
It was not necessarily an enormous reinvention of things that were already available. In addition, I think very compelling question is how people would stumble across and decide that they wanted to do this, when it was kept essentially in a walled garden behind this tablet pay wall. So, there were questions of execution, both technically, in terms of content but also about how you market this to people who aren't already experiencing it themselves.
Jeff Jarvis also pointed out that, in the digital world, it's hard to sell news when the stuff is leaking out of every corner on the web:
Larry Kramer, publisher of the much-larger USA Today, just said with admirable candor that he can't put up a pay wall online because his product "isn't unique enough". Ditto The Daily.
But for Jarvis, there was one other structural problem with the product - unfortunately, the paper's unique selling point, the once-a-day publication:
News was only ever daily because it was forced into that limitation by the means of production and distribution of print. The internet freed us from those shackles of time. Why put them on again? Nostalgia?
A hard-to-discover product charging money for stale news. Not an entirely compelling proposition. The title closed at the end of 2012.
So, having burned through some cash, has the idea of a digital newspaper deciding to restore the shackles of a print timetable been buried? Well... not quite. Last week, an announcement came from a different part of the Murdoch news empire. The UK Press Gazette carried the story:
The Times and Sunday Times have merged their websites and relaunched them with a focus around “editions” rather than rolling news.
One core edition will be published each day on The Times which will then be updated at 9am, midday and 5pm. Updates will also appear on smartphone and tablet apps.
On weekends the edition updates will be at midday and 6pm.
Publisher News UK said in a statement: “The move from rolling news to an edition-based model is based on intensive customer research, which showed that readers come to The Times and The Sunday Times at set points of the day and read us primarily for the accuracy of our reporting, and the originality of our analysis and comment.
“The new publishing times reflect the pattern of our readers’ daily routines and their desire for a curated, finite edition that will keep them fully informed in minimum time, with maximum flair. We retain the flexibility to follow a big breaking news story if the editors believe it is warranted.
“The new responsive website and apps have a cleaner, smarter design and a new font, Times Digital, to optimise the digital reading experience. Our sections will also be named consistently across all of our products for ease and simplicity.”
It sounds a lot like The Daily, or at least The Three Times Daily. This time, though, the experiment is taking place from a position of greater strength - The Times is turning a profit, and already has a subscriber base larger than that of The Daily at the point it closed. Maybe the idea of The Daily isn't quite as dead as it seemed.
What does it take to win in the digital world? Find out with our free course Succeeding In The Digital World