A few well-written words can convey a wealth of information, particularly when there is no lag time between when they are written and when they are read. The IPS blog gives you an opportunity to hear directly from IPS scholars and staff on ideas large and small and for us to hear back from you.
- wall street tax
- Green Climate Fund
- carbon trading
- State Of The Union
- climate justice
- climate finance
- United Nations
- Pete Seeger
- John Kerry
- robin hood tax
Baltimore Nonviolence Center
Barbara's Blog, by Barbara Ehrenreich
Blog This Rock
Busboys and Poets Blog
CODEPINK's Pink Tank
Demos blog: Ideas|Action
Dollars and Sense blog
Economic Policy Institute
Editor's Cut: The Nation Blog
FOE International blog
Kevin Drum (Mother Jones)
The New America Media blogs
Political Animal/Washington Monthly
Southern Poverty Law Center
US Campaign to End the Israeli Occupation
Entries tagged "financial transactions tax"Page Previous 1 • 2 • 3 • 4 • 5 • 6 Next
December 14, 2012 · By Sarah Anderson
Under pressure to address a massive deficit, legislators voted overwhelmingly this week in favor of a tax on financial speculation. This really happened, I swear.
OK, it was in Europe, not the United States. But it could happen here—and it should.
The vote in the European Parliament on December 10 was the latest in a series of victories by international campaigners for a tax on trades of stocks, bonds, and derivatives. Often called a “Robin Hood Tax,” the goal is to raise massive revenues for urgent needs, such as combating unemployment, global poverty, and climate change.
A financial transaction tax would also discourage the senseless high frequency trading that now dominates our financial markets. Recently, the chief economist of the Commodity Futures Trading Commission (the top U.S. derivatives regulator) found that such trading practices are hurting traditional investors.
In reaction to the Parliamentary vote, David Hillman, of the U.K. Robin Hood Tax campaign, said that the tax “will raise at least 37 billion euros per year for the countries involved whilst reining in the worst excesses of the financial sector.”
Nicolas Mombrial, a Brussels-based policy adviser for Oxfam, added that “The European Parliament’s overwhelming support reflects the will of Europe’s people. In cash-strapped times, an financial transactions tax is a no-brainer that is morally right, technically feasible, and economically sound.”
Read the rest of this article on the Yes! Magazine website.
October 12, 2012 · By Sarah Anderson
European campaigners for a financial transaction tax have done some awfully goofy things over the past three years.
At one French demonstration, they stripped down to their skivvies to emphasize the small size of the tax (0.1% on trade of stocks and bonds and 0.02% on derivatives under the European Commission's proposal). In Germany, they rented a limo and crashed the Berlinale film festival, dressed as Robin Hood characters. In many countries, they've gotten elected officials to pose with silly hats and fake bows and arrows.
But after this week, the opponents of the financial transaction tax (aka Robin Hood Tax) will no longer snicker at such antics. At a meeting of European finance ministers on October 9, 11 governments committed to implementing the tax. This is two more than the minimum number needed for an official EU agreement. And it is a huge victory for those of us -- not just in Europe but also in the United States and around the world -- who've been pushing for such taxes as a way to curb short-term speculation and generate massive revenue for job creation, global health, climate, and other pressing needs.
Of course the goofy stunts weren't the only game-changers. Campaigners have also built up strong technical arguments about the feasibility of such taxes. And a growing number of financial professionals have come out in support, blunting the industry backlash.
The broader European crisis has also been a major factor. In fact, there are rumors that Italy and Spain may have sold their support in exchange for some debt concessions from Germany. The additional eight governments in the new coalition of the willing are France, Austria, Belgium, Estonia, Greece, Portugal, Slovakia, and Slovenia. More may join in the coming months.
There are still a few hurdles ahead. There will be a round of negotiations that could result in the European Commission's proposal being watered down by lowering the rates or narrowing the base to only cover securities. There will be a fight to make sure revenues help people and the planet instead of the big banks. And EU heads of state will have to vote by a qualified majority to give the initiative the green light. This means some countries that don't plan to implement the tax themselves will still need to sign off on it. The biggest opponent, UK Prime Minister David Cameron, may have some obstructionist tricks up his sleeve.
But according to Peter Wahl of WEED, one of the key forces behind the German campaign, "there is now quite a strong political will behind the project, so that we can expect definitive implementation rather soon, perhaps already during 2013."
Europe's dramatic step forward can only boost the growing U.S. grassroots efforts for a Robin Hood Tax. Our current Treasury Secretary, Timothy Geithner, has been a naysayer, sometimes even chastising European leaders for considering the idea. But with Geithner heading out the door after the election and Europe moving towards raising revenue off the tax, we may get a blast of fresh thinking.
Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies.
Follow her on Twitter: www.twitter.com/Anderson_IPS
October 9, 2012 · By Janet Redman
Civil society to World Bank president Dr. Jim Kim, "add your voice to the choir of support for an FTT"
Today, the Institute for Policy Studies sent the newly appointed World Bank president Dr. Jim Kim a letter signed by 58 organizations from around the world urging him to champion financial transaction taxes (FTT) – a tiny tax on stocks, bonds, currency and other derivatives trades - as an innovative way to raise much-needed money to address climate change, health and other development priorities in poorer countries. The groups – including WWF, Greenpeace, Oxfam, AFL-CIO, World AIDS Campaign, United Methodist Church, and the Main Street Alliance – come from a broad cross-section of civil society and show a growing consensus that it's time for developed countries to get serious about meeting their promises on climate and development finance.
The letter was sent in anticipation of the World Bank's annual meeting in Tokyo later this week, where high-level finance ministry officials from developed and developing countries will assemble to discuss poverty eradication, sustainable development and the world economic outlook.
In the letter, groups urged Dr. Kim to "[p]romote FTT as a source of innovative finance for developing countries’ efforts to address climate change. Such revenues are needed for the Green Climate Fund and … it would be helpful to promote FTT as a source of climate finance in the context of studies and reports mandated by international bodies such as the G20 and the UN."
In conjunction with the Bank meetings the Leading Group on Innovative Financing for Development will hold a symposium highlighting the role of FTT on meeting the funding gap for climate and development left by the global economic crisis. Two of the countries featured in the event – France and Germany – are part of an eleven-country 'coalition of the willing' that announced their commitment to implement an FTT today at the European Union Finance Ministers Meeting (ECOFIN). The letter to Kim emphasized that "[a]t this key moment in their decision-making, it is particularly important to urge European leaders to allocate part of FTT revenue to development and climate."
Now that countries have taken this leap forward, the World Bank's leader should make his own bold move and support an FTT.
Note: Besides the four biggest economies in the Eurozone – France, Germany, Italy and Spain – Austria, Belgium, Estonia, Greece, Portugal, Slovakia and Slovenia have pledged to implement a financial transaction tax at ECOFIN. This "coalition of the willing" approach will still need to be given the green light by EU heads of state, but the political momentum is clearly strong.
Dr. Jim Yong Kim
The World Bank
1818 H Street, NW
Washington, DC 20433
October 9, 2012
Re: Financial transaction taxes as a source of innovative finance
Dear Dr. Kim:
We, the undersigned 58 organizations, congratulate you on your position as World Bank President. We are hopeful that with your impressive track record, you will bring fresh thinking to this important financial institution.
We are writing now to encourage you to use your prominent position of influence to become a vocal champion of innovative ways to ensure sufficient resources are available to tackle the most pressing problems faced by the world’s poorest and most vulnerable people.
Given the budget constraints facing many of the largest donor countries, it is widely accepted that new sources of financing are needed. Our organizations are part of a growing international campaign to promote one of the most promising forms of innovative finance – small taxes on trades of stock, derivatives, currencies, and other financial instruments.
We have long advocated that such financial transaction taxes (FTTs) are a practical way to generate revenue to fill domestic and international financing gaps, discourage the type of short- term financial speculation that has little social value but poses high risks to the economy, and serve as a predictable and sustainable source financing for health, climate, development, education, and job creation. In a recent paper, the UN Department of Economic and Social Affairs concluded that “financial and currency transaction taxes are technically feasible and economically sensible. They could readily provide the means of meeting global development financing needs.”
Over the past two years, we have been encouraged by significant shifts in the debate, with influential leaders such as Bill Gates, UNAIDS Executive Director Michel Sidibé, Bishop Desmond Tutu, Kofi Annan, and Pope Benedict XVI coming out in support. Now is a critical time to add your voice to the call.
A group of at least 11 European governments appears on track to forge an EU agreement to implement a FTT by the end of 2012. However, with the exception of France, they have made no clear commitment yet on how the resources would be allocated. Your support could help ensure that a substantial portion of the revenue goes to meet the needs of the world’s poorest people, rather than simply paying down deficits.
1. Raise FTT in the context of your work to publicize the new World Development Report focusing on jobs. As governments look for sources of financing for job-creation strategies, FTT should be promoted as one potential source.
2. Promote the FTT as part of a plan to achieve internationally agreed global health, education and other development goals. For example, with the prospect of ending AIDS closer than ever, FTT revenues could help achieve Millennium Development Goal #6, aimed at reversing the spread of HIV/AIDS and ensuring universal access to treatment and help fully fund implementation of the 2011 Political Declaration on HIV/AIDS.
3. Promote FTT as a source of innovative finance for developing countries’ efforts to address climate change. Such revenues are needed for the Green Climate Fund and other funds of the UN Framework Convention on Climate Change, including the Adaptation Fund, Least Developed Countries Fund, and the Special Climate Change Fund. Further, it would be helpful to promote FTT as a source of climate finance in the context of studies and reports mandated by international bodies such as the G20 and the UN.
4. Bring these messages to the general public and world leaders. At this key moment in their decision-making, it is particularly important to urge European leaders to allocate part of FTT revenue to development and climate. We also recommend that you publish an open letter on this theme in major newspapers.
5. Meet with civil society and independent experts on this timely issue. We would be very pleased to organize a briefing that would include participation by leading experts in the field. Over the past several years, many of our organizations have been involved in similar briefings with the International Monetary Fund, the Gates Foundation, the European Commission, and national governments. We would appreciate the opportunity to share research and analysis of the feasibility and potential benefits of this means of generating additional finance.
We look forward to hearing from you. Sincerely,
Alliance for a Just Society, USA
Australian Council of Trade Unions (ACTU)
Balance Promoción para el Desarrollo y Juventud, Mexico
Campaign for the Welfare State, Norway
Canadian HIV/AIDS Legal Network
Center for Economic and Social Rights, USA
Chicago Political Economy Group, USA
Coalition 15%, Cameroon
Comisiones Obreras (CCOO), Spain
Confederazione Generale Italiana del Lavoro (Ialian Geneneral Confederation on Labour)
CPATH (Center for Policy Analysis on Trade and Health), USA
Ecologistas en Acción, Spain
Europeans for Financial Reform
Friends of the Earth U.S. Gender Action, USA
Global Health Advocates France Global South Initiative, Nepal
Halifax Initiative, Canada
Health GAP, USA
IG Bauen-Agrar-Umwelt (Trade Union for Building, Forestry, Agriculture and the Environment), Germany
INPUD (International Network of People who Use Drugs), United Kingdom
Institute for Policy Studies, Global Economy Project, USA
Interagency Coalition on AIDS and Development (ICAD), Canada
International Civil Society Support International HIV/AIDS Alliance
International NGO Forum on Indonesian Development (INFID)
International Trade Union Confederation
Kampagne: Steuer gegen Armut (Tax Against Poverty Campaign), Germany
KOO-Koordinierungsstelle der Österreichischen Bischofskonferenz f.internationale Entwicklung und Mission, Austria
Main Street Alliance, USA
Maryknoll Office for Global Concerns, USA
National Union of Public and General Employees, Canada
NSW Nurses and Midwives' Association, Australia
Public Services International
Réseau Accès aux Médicaments Essentiels (RAME), Burkina Faso
Robin Hood Tax Campaign, United Kingdom
Stamp Out Poverty, United Kingdom
Trades Union Congress, Great Britain
Treatment Action Group, USA
UBUNTU - World Forum of Civil Society Networks
Unión Sindical Obrera (USO), Spain
United Methodist Church, General Board of Church and Society, USA
Wealth for the Common Good, USA
Women in Europe and Central Asia Regions plus (WECARe+), Germany
World AIDS Campaign International, South Africa and Kenya
World Democratic Governance project Association
World Federalist Movement Japan
July 3, 2012 · By Salvatore Babones
The leaders of continental Europe's four biggest countries agreed at last week's euro zone summit on the principle that the European Union should move toward imposing a tax on financial transactions. Though it was hardly mentioned in the U.S. press, the agreement was big news in Europe. The leaders say they will raise funds equal to 1 percent of total euro zone gross domestic product through a financial transactions tax (FTT), though no details were forthcoming on just what would be taxed or at what rates.
That President François Hollande of France, Chancellor Angela Merkel of Germany, Prime Minister Mario Monte of Italy and Prime Minister Mariano Rajoy should all take time out from acute crisis talks to agree on any long-term policy position is remarkable. That they should agree on a new tax is more remarkable still. Nonetheless, Chancellor Merkel stated flatly that she was "pleased that all four here have committed to a financial transactions tax."
FFTs are nothing new. They used to be called "stamp duties" and all industrialized countries used to have them. Today, they survive mainly in real estate transfer taxes. Stamp duties on frequently traded financial instruments like stocks and bonds were eliminated in the twentieth century in most countries under pressure from the finance industry.
When the world went off the gold standard in 1971 and modern foreign currency markets came into existence, economist James Tobin recommended that a small transactions tax be applied to foreign exchange transactions as a way to prevent instability in these new markets. He argued that the hyper-efficiency of foreign exchange markets could lead to unwanted volatility that might harm countries' real economies and that a transactions tax would reduce these tendencies.
If Tobin was right for the foreign currency markets, he was even more right for stock markets. He couldn't anticipate in 1972 that by 2012 stocks would be traded electronically at such high speed that banks would move their computers physically closer to the exchanges so that their trading orders would be executed faster. Tobin taxes are probably more important today for damping down volatility in share markets than in currency markets.
The goal of a Tobin tax on financial transactions is not to take from the rich and give to the poor. It's to prevent the rich from destroying the economy for the rest of us. Tobin taxes are meant to slow down runaway markets, to let a little air out of inflating bubbles and in general to give people and governments just a little more time to respond to economic problems before they get out of hand. Tobin taxes give the real economy just a miniscule edge over the speculative economy. Usually, that's all that's needed to prevent the speculators from running roughshod over the rest of us.
What turns a Tobin tax into a Robin Hood tax is what you do with the money you collect. President Hollande et compagnie have made no mention of taking from the rich to give to the poor. Their plan, to the extent that they have one, seems to be to use the proceeds of a FFT to fund the European Union budget. At best, the money collected might go to the poor of Europe. There's certainly no talk of spending it on the poor of the world.
And, yet, the rich countries of the world - including the euro four and the United States - have all agreed to dedicate at least 0.7 percent of their national incomes to official development assistance (ODA) to poor countries. This foreign aid commitment has been in place in various forms since 1970, though it has been met by only a few (mainly Nordic) countries. Since the beginning of the global financial crisis, levels of ODA have actually declined for many countries.
United States ODA to poor countries is only 0.21 percent. The top three recipients are Afghanistan, Iraq and Pakistan, which hardly suggests that our aid money is independent of our foreign policy goals. France, Germany, Italy and Spain give 0.50 percent, 0.39 percent, 0.15 percent and 0.43 percent, respectively (2010 figures from the Organisation for Economic Co-operation and Development).
The numbers being mooted for the euro zone FTT are tantalizingly similar to the figures that developed countries have committed to spending on foreign aid. It is, however, highly unlikely that any money raised will be used for this purpose. A new tax imposed during an upturn might go to aid. A new tax imposed during a downturn will inevitably be spent at home.
The best solution might be a threshold split. The first 0.5 percent of gross domestic product raised by an FTT could be spent on national debt relief. Any remaining sum could then go to the aid budget. The advantage of such an arrangement would be to make the tax politically palatable now, but morally palatable later. It would also make the tax anti-cyclical: in a downturn the money raised would stay at home, while in an upturn it would go abroad. Wins all around.
But waiting in the wings is the sheriff of Nottingham. The UK's Chancellor of the Exchequer, George Osborne, staunchly opposes a European FFT that might cover British-based companies. Of course, if it doesn't include the UK, a European FTT would just drive business to London. The City of London is by far the world's largest offshore financial center, dwarfing other even shadier British territories like Bermuda, the Channel Islands, the Cayman Islands, the Isle of Man and the Turks and Caicos Islands.
To have any hope of helping the ordinary citizens of Europe and the poor people of the rest of the world, a European FTT would have to be coupled with European legislation to prohibit the trading of European financial instruments outside Europe. This is technically feasible, but it would require a higher level of commitment than European leaders have shown to date.
To be morally and politically palatable, a FFT should have a built-in threshold beyond which any funds collected would go straight to official development assistance. On the one hand, it is politically unrealistic to expect a European FTT to be devoted entirely to foreign aid. On the other hand, a narrowly targeted FTT designed only to respond to the current euro crisis might simply be repealed once the crisis passes. A well-designed FTT should serve both purposes.
Throughout this debate it must be remembered that a well-designed FTT will pay for itself. The original Tobin tax idea wasn't about feeding the poor. It was about improving economic performance by damping down the worst excesses of financial markets. Runaway markets can severely misallocate financial capital. We should all have learned that lesson in 2007, if not in 1929. If we can save the euro while improving the economy and at the same time divert part of the benefit to help the poorest people on Earth ... why not?
The sheriff might just have to accept a happy ending after all.
June 19, 2012 · By Janet Redman
Today I’m joining tens of thousands of people — in 15 cities around the country — rallying outside Wall Street institutions to tell President Barack Obama that it's time to put a tiny tax on big banks. We’re calling it a Robin Hood tax because the tiny tax will hit some of the wealthiest corporations on earth, but the money it raises will mean big bucks for people and the planet. Take back our money from the banks, give it to the people. Simple enough:
In Washington, DC, where I live, we’re heading down to JP Morgan — home to CEO Jamie Dimon who just lost $2 billion on his watch to risky trades. He told members of Congress in a hearing last week that everyone should calm down, it’s just a drop in the bucket. He's likely to stick to the same script at another hearing today.
This is exactly the problem. Wall Street fat cats don’t care if their reckless behavior makes the economy less stable. In fact, they make a lot of money when the prices of things like food and oil race up and down.
Volatility may be a cash cow for the already rich, but it undermines long-term investment in what we actually need — like clean energy. A Robin Hood tax could curb some of that risky speculation by making high-speed trading less lucrative.
That’s part of why climate activists are calling on world leaders to tax financial speculation — and why that call is reaching a crescendo at the Rio+20 Earth Summit. People who care about our children’s future are demanding that the financial sector, which made trillions from a global economy that trashed the planet, pay its fair share to heal the environment.
The other reason is that a Robin Hood tax could raise hundreds of billions of dollars each year for building a climate-friendly economy and creating good, green jobs.
Heads of State like new French President François Hollande are committed to a financial speculation tax, and to coordinating with other European countries. Now more than ever it’s time for Obama to say yes to a Robin Hood tax.