Secrecy and Kleptocracy

Over a century ago, Georg Simmel noted that the need for secrecy unites the nobility with criminal gangs in their quest for power and resources. This insight finds its most vivid contemporary expression in the offshore financial system, where trillions in private household wealth – totaling at least 12 percent of global GDP – circulate largely outside the rule of law. It makes possible not just tax evasion, but law evasion writ large, including debt dodging and the corruption of electoral systems. This system has created a multinational elite which has grown nearly ungovernable, threatening democracy, capitalism, and even the natural environment. The talk will offer a sociological analysis of the agency and mechanisms underlying this phenomenon, drawing on both a long-term ethnography of the offshore system and Big Data network analysis of its characteristics – including its hidden vulnerabilities.

Brooke Harrington is Professor of Economic Sociology at Dartmouth College. Since 2007, she has examined inequality from the top end of the socio-economic spectrum, via the offshore financial system – a research program inaugurated at the MPIfG. Her most recent publication from this project, Offshore: Stealth Wealth and the New Colonialism (W.W. Norton, 2024; in German from Campus) was named a “Best Book of 2024” by the Financial Times and one of the “Political Books That Help Us Make Sense of 2024” by The New Yorker. Her previous book on offshore finance as a social, political and economic phenomenon –  Capital without Borders (Harvard University Press) – won the Outstanding Book Award of the Secion on Inequality, Poverty and Mobility of the American Sociological Association and was translated into four languages. With a grant from the US National Science Foundation, she is currently leading a team using network science methods on the Panama, Paradise and Pandora Papers – nearly 7 terabytes of leaked offshore files – to test propositions gleaned from her ethnographic research.

Suggested preparatory reading

How the offshore financial system works and how my research came to focus on wealth managers as hubs of the system.
2015 Atlantic article | 2012 scholarly journal article

Quantitative network analysis testing the key propositions derived from my qualitative research – namely, that wealth managers really are the hubs of the system and sanctions should focus on stopping them.
2023 NYT op-ed | 2023 scholarly journal article