| Welcome to The Daily 202! Tell your friends to sign up here. On this day in 1957, the Soviet Union successfully launched the first artificial satellite, Sputnik, kicking off the Space Age and fueling American fears of the U.S.S.R.'s technological capabilities. | | |  | The big idea | | Fresh tranche of 'Pandora Papers' shows U.S. rise as secretive tax haven | | But the rise of the Mount Rushmore state — and several others — as a harbor for shielding global wealth is interesting inasmuch as America has always lectured smaller countries about the necessity of unimpeachable financial hygiene and transparency. And another wave of hard evidence the global elites exploit rules that rig the global financial system in their favor could have domestic political aftershocks, as President Biden pushes to raise taxes on the wealthy and corporations to pay for his ambitious domestic agenda. The White House did not return an email seeking comment. The details can be found in nearly 12 million financial records obtained by the International Consortium of Investigative Journalists (ICIJ) and examined by The Washington Post and other news organizations. Today, The Post is publishing its second wave of articles based on the Pandora Papers. | | From Sioux Falls, S.D., my colleagues Debbie Cenziper, Will Fitzgibbon, and Salwan Georges reported on a seven-year-old financial firm called "Trident Trust" that enticed clientele with "The South Dakota Advantage" — essentially laws making it easier to hide who owns what and where. "Among those who answered the call: a Colombian textile magnate caught in a scheme to launder the proceeds of an international drug ring, an orange juice mogul who settled with authorities in Brazil for allegedly colluding to underpay local farmers, and family members of the former president of a sugar producer in the Dominican Republic that has been accused of exploiting laborers and forcibly evicting families from their homes." Debbie, Will, and Salwan note: "[A] burgeoning American trust industry is increasingly sheltering the assets of international millionaires and billionaires by promising levels of protection and secrecy that rival or surpass those offered in overseas tax havens. That shield, which is near-absolute, has insulated the industry from meaningful oversight and allowed it to forge new footholds in U.S. states." | | It's not just South Dakota, of course, my colleagues reported: "Other states competing to lure wealth include Alaska, Delaware, Nevada and New Hampshire. In South Dakota, assets in trusts more than quadrupled over the past decade to $360 billion. One of the largest trust companies in the state, the South Dakota Trust Company, boasts a roster of international clients from 54 countries. The industry's rapid expansion was led by a group of trust company insiders, who year after year pitched legislative proposals that were highly appealing to customers in the United States and abroad: protecting trusts from creditors, from taxing authorities, from foreign governments. With little opposition, state legislators turned the proposals into laws — dozens since the late 1990s." The Pandora Papers helped identify "206 U.S.-based trusts holding combined assets worth more than $1 billion, including nearly 30 trusts that held assets linked to people or companies accused of fraud, bribery or human rights abuses in some of the world's most vulnerable communities." | | The latest Washington Post stories on the #PandoraPapers | "[A] burgeoning American trust industry is increasingly sheltering the assets of international millionaires and billionaires by promising levels of protection and secrecy that rival or surpass those offered in overseas tax havens." | | | | | | | | Quite apart from the global super-rich parking their money in American shelters is the matter of U.S. citizens hiding money from the courts and their victims overseas, as Debbie and Will document here. "Efforts to find and seize assets sheltered abroad are often hamstrung by uncooperative providers of offshore services, and by treaties on information sharing that can produce outdated or limited information, according to a dozen former prosecutors and investigators" who spoke to The Post and the ICIJ, Debbie and Will reported. That comes at an enormous cost to Mark Ryan and his family, they explained. Ryan and two other men sued entertainment executive Marc Collins-Rector, accusing him of drugging, threatening and raping them. "They won a multimillion-dollar default judgment from a California court — money that would have helped pay for the care Ryan needed after seizures and a stroke, brought on by an abrupt withdrawal from the alcohol and pills, forced him into the nursing home just after his 30th birthday." They never got a dime. Here are Debbie and Will on how he did it: "For a fee of $500, Collins-Rector set up a trust in the Central American country of Belize through a financial and corporate services firm that grew into a one-stop shop for American clients, including at least a dozen who sheltered assets while facing criminal investigations or costly lawsuits. Robert Durst, convicted last month for the execution-style murder of a close friend and confidante in California in 2000, was a client. So was a mob accomplice; a dentist charged with defrauding Medicaid; a producer of adulterated drugs; and the founder of a cruise company accused of negligence by the families of 31 sailors who drowned during a hurricane." | | A fresh story shows how U.S. sanctions afflict Putin's allies — and how far they go to evade them, Greg Miller reports. "The Pandora files show sanctions not only hitting their Russian targets but then triggering losses that spread across their interconnected financial networks. The documents contain material on at least 46 Russian oligarchs who appear on the Forbes list of billionaires... But the files also underscore the limits of sanctions, making clear that vast quantities of Russian money continue to slosh through secret global accounts while Moscow's actions beyond its borders seem undeterred." | | |  | What's happening now | | Biden attacks Republican tactics as 'reckless and dangerous' when it comes to the debt ceiling |  Biden and first lady Jill Biden return to the White House after spending the weekend in Delaware. (Chip Somodevilla/Getty Images) | | | Biden spoke about the debt ceiling limit a few moments ago, attacking Republicans for their "reckless and dangerous" approach to raising it. The president stressed that a debt limit increase would pay for what the U.S. has already spent, not his infrastructure package. "In my view, raising the debt limit comes down to paying what we already owe. What has already been acquired is not anything new," he said. "So, if we're going to make good on what's already been approved by previous Congresses and previous presidents and parties, we have to pay for it." | - Key quote: "Folks watching at home, you should know this is the Republican position," Biden said. "They won't vote to raise the debt limit to cover their own spending. Democrats voted with them to cover that spending last four years... Not only are Republicans refusing to do their job, but threatening to use the power, their power to prevent us from doing our job, saving the economy from a catastrophic event. I think, quite frankly, it's hypocritical, dangerous and disgraceful."
- Biden said Democrats won't use reconciliation because it's "fraught with all kinds of potential danger for miscalculation." He said he will talk to Senate Minority Leader Mitch McConnell after the Kentucky Republican sent him a letter asking Democrats to use reconciliation.
- Biden said he has 48 Senate votes for his reconciliation package and needs two more, but he declined to pinpoint Sen. Kyrsten Sinema's (D-Ariz.) topline number is on a reconciliation package.
- The president said he will speak more on his agenda tomorrow.
| | Senate Majority Leader Chuck Schumer (D-N.Y.) says the debt ceiling must be addressed "by the end of this week." "Schumer's push to accelerate the debt ceiling vote comes as lawmakers have just two weeks before hitting the date at which the U.S. government may run out of the ability to pay all of its bills. Treasury Secretary Janet Yellen has told lawmakers Treasury could hit the 'X Date' when it runs out of 'emergency measures' to pay its obligations on Oct. 18, but stressed there is substantial uncertainty surrounding that projection," Jeff Stein and Tony Romm report. | - "Let me be clear about the task ahead of us: we must get a bill to the President's desk dealing with the debt limit by the end of the week. Period," Schumer said in a letter to other Senate Democrats.
| | |  | Lunchtime reads from The Post | | Ex-Facebook employee is the whistleblower |  Facebook whistleblower Frances Haugen talks with CBS's Scott Pelley on "60 Minutes." (Robert Fortunato/CBS News) | | | A former Facebook employee, Frances Haugen, was revealed as the "whistleblower" behind leaked documents that plunged the company into scandal, Cat Zakrzewski and Cristiano Lima report. Haugen was behind the leak of "thousands of pages of leaked internal company research, which she says show that the company has been negligent in eliminating violence, misinformation and other harmful content from its services, and that it has misled investors about these efforts." | - Haugen told The Post that "while working at Facebook in the company's civic integrity division, she realized it was not disclosing important information about the harms of its products to the public and the policymakers tasked with regulation, creating a situation she said posed a threat to democracy."
- "Facebook in its current form is dangerous," she said. "It became necessary to get the public involved."
| | USPS is testing paycheck cashing, which could transform how millions access money and pay bills. "Postal customers can now redeem paychecks in Washington, Baltimore, Falls Church, Va., and the Bronx, N.Y., for Visa gift cards topping out at $500, an agency spokesperson said. Postal officials expect to expand the pilot into a fuller study with more locations and financial products, such as bill-paying services and ATMs, according to three people involved with the program," Jacob Bogage reports. | - "Postal banking has become a Democratic hobby horse in recent years, with activists and politicians saying it solves two problems: the Postal Service's precarious financial condition and the barriers many U.S. households face to building wealth and accessing their money."
- "For the nation's 14.1 million unbanked and underbanked adults, the plan presents a government-backed alternative to paycheck cashing stores and payday lenders."
| - "Covid outbreaks have idled port terminals. There still aren't enough cargo containers, causing prices to spike 10-fold from a year ago. Labor shortages have stalled trucking and pushed U.S. job openings to all-time highs. And that was before UPS, Walmart and others embark on hiring hundreds of thousands of seasonal workers to take on the peak of peak."
| | Trump's rally in Perry, Ga., might have bolstered the legal case against him. "The Brookings Institution think tank on Monday updated its analysis of Trump's post-election conduct to include his remarks at the Sept. 25 rally in Perry, when he repeatedly blasted Gov. Brian Kemp for refusing to reverse his defeat," the Atlanta Journal-Constitution's Greg Bluestein reports. | - "Trump has long assailed Kemp for refusing to call a special legislative session, but the report's authors say the remarks specifically calling for a 'special election' are a new angle for investigators, one that echoes comments from advisers promoting the idea that he could have declared martial law to force states to hold new elections."
| | |  | The Pandora Papers investigation, visualized | | | The massive trove of private financial records exceeds the dimensions of the leak that was at the center of the Panama Papers investigation five years ago. The new material encompasses records from 14 separate financial-services entities operating in countries and territories including Switzerland, Singapore, Cyprus, Belize and the British Virgin Islands. Read more about this global investigation. | | |  | Hot on the left | | | "The congressional committee investigating the Jan. 6 assault on the Capitol is steeling itself for its first encounter with an immovable object: Donald Trump," Politico's Kyle Cheney reports. "The former president has a fast-approaching deadline to attempt to block the National Archives from releasing records from his White House that could shed light on his attempts to overturn the 2020 election results. And some of Trump's closest aides have until Thursday to comply with a committee subpoena for their own records. … The expected fight from Trump is likely to be the first test of [the panel's] legal and political muscle … "[On Thursday] subpoenas to former White House Chief of Staff Mark Meadows, longtime Trump aide Dan Scavino and Trump-world figures Steve Bannon and Kash Patel require them to supply documents to the panel … But committee members expect that these witnesses won't willingly cooperate — one of the reasons the panel issued subpoenas without offering them a chance to voluntarily provide documents or testimony." | | |  | Hot on the right | | | Trump said he'd beat Florida Gov. Ron DeSantis in a 2024 GOP primary. In an interview with Yahoo! Finance's Ben Werschkul, Trump talked about a wide range of topics — the pandemic, the economy, and his plans for a third run for the presidency. "The former president was confident about his chances if he decided to run, even if it meant a potential head-to-head matchup with DeSantis, another GOP favorite. 'If I faced him, I'd beat him like I would beat everyone else,' Trump declared, even as he said he doesn't actually expect a showdown. 'I don't think I will face him,' he predicted about what DeSantis and other Republicans would do if he got into the race. 'I think most people would drop out, I think he would drop out.' The Florida governor is currently up for reelection in 2022, and he says he isn't looking beyond that race." | | |  | Today in Washington | | | Biden has no more public events listed in today's schedule. | | |  | In closing | | | John Oliver talked about a specific type of chemicals — PFAS — and the danger they present:  | | | | | Thanks for reading. See you tomorrow. | | |
