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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.

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Entries since October 2012

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European Victory on Taxing Speculation

October 12, 2012 ·

Cross-Posted with the Huffington Post

European campaigners for a financial transaction tax have done some awfully goofy things over the past three years.

Global Day of Action FTT-Robin Hood Tax/FlickrAt 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 

Join Us October 17 at the Letelier-Moffitt Awards

October 12, 2012 ·

We’d love to see you Wednesday, October 17, at the Letelier-Moffitt Human Rights Awards reception and ceremony at the Carnegie Institution. It will be an uplifting evening, with generations of social justice activists on hand to enjoy the artistry of DC’s most powerful and visionary youth poets and the music of Patricio Zamorano and his band as we celebrate national and international voices for justice.

Tickets may sell out soon, so purchase yours now or support this important event even if you can't attend.

Student leaders Noam Titelman, Camila Vallejo and Boris Gabriel participate in a demonstration in downtown SantiagoWe are thrilled to honor two amazing organizations in 2012 with much in common. Just as the Chilean Students Movement is challenging Augusto Pinochet's legacy and free-market ideology, City Life/Vida Urbana is standing up to Ronald Reagan's legacy and ideology. These struggles are also united in building a better world rooted in the rights to education, housing, and other core needs. And they are planting the seeds of transformative change.

Both groups remind us of what so many of you know so well: Powerful social movements equipped with bold ideas are the catalysts for positive social change. IPS is proud to belong to dynamic coalitions forging powerful new approaches that are making a difference.

The great actor and activist Danny Glover will present the City Life/Vida Urbana award to Curdina Hill and Steve Meacham. Tiffany Loftin, president of the United States Student Association, will present the award to the Chilean student leaders Camila Vallejo and Noam Titelman.

City Life actionFun fact: Readers of the UK's Guardian newspaper chose Vallejo as "the person of the year."

If you've attended in recent years, please take note of our new venue, located at 1530 P Street, NW in Washington, DC. The reception will begin at 5:30 p.m. and the ceremony will get underway at 7 p.m.

The Institute for Policy Studies has honored human rights heroes for 36 years in the names of our colleagues Orlando Letelier and Ronni Karpen Moffitt, who were assassinated in 1976 by agents of the Chilean dictatorship. John Cavanagh is the Institute's director and Joy Zarembka is its associate director. IPS-dc.org

What Went Unmentioned in the Vice Presidential Debate

October 11, 2012 ·

Biden and Ryan discuss Israel but ignore Palestine.

What remains missing on in the v-p debate is what Israel has gained from the debate — just the debate! — over Iran. That is, as long as Israel maintains its spurious claim that Iran represents an "existential threat" to Israel, no one — no one — especially in the United States, is willing to say a word, let alone exert real pressure, on Israel to end its occupation of Palestinian lands and its apartheid policies towards Palestinian people. No one's talking about that.
 
On the substance of Iran, we once again saw an actual disagreement on Iran policy. We're still hearing about "red lines" for the use of force against Iran, but the red lines are in two different places. To his credit, Biden didn't reference a military strike or red lines directly, although he did say the Obama administration would not allow Iran "to get" a nuclear weapon. He went on to say that war should always be the last resort.
 
Ryan was different. He reinforced Romney's on-again-off-again red line, threatening force to prevent Iran from obtaining "nuclear capability" — which could mean today.

But once again — Israel's occupation, apartheid, settlements expansion, the siege of Gaza, Palestinian prisoners, violations of international law and human rights — not a word. We heard from Biden that "the last thing America needs is to get into another ground war in the Middle East." But he sticks to the Obama plan — endorsed by Ryan as well — for maintaining the war through at least the end of 2014, when a "transition" to Afghan security would take place, with training, special ops, and other forces remaining in Afghanistan. No evidence of what might be different after another year and a half of war, instead of ending it right now, but nonetheless both parties agree on continuing a failed and devastating war.

And once again the drone war, militarization of U.S. policy in Africa... and Palestine, all remain unmentioned. The unspoken, indiscernable, invisible questions. And Palestine at the center.

This Week in OtherWords: A Genetically Engineered Food Special Edition

October 10, 2012 ·

This week, OtherWords is running three commentaries and a cartoon regarding the growing number of genetically modified foods that land on our plate whether we realize it or not.

In her debut guest column, Jill Richardson challenges big food companies to boast about their penchant for these modified crops if they're so wonderful. Wenonah Hauter introduces readers to the latest newfangled food making a stir: an apple that doesn't brown when it's sliced long before it's eaten. Jim Hightower discusses the ruse maintained by General Mills, Kellogg, and other huge food companies that have bought out tiny organic outfits and tried to not let consumers know.

Any of these commentaries could accompany Khalil Bendib's Snow White cartoon, which depicts a witch handing her a new kind of poisoned apple. And all three address California's upcoming referendum on a new state rule that would require the labeling of genetically modified food. Known as Proposition 37, this requirement would have national ramifications for the industry because of California's huge market.

As always, I encourage you to subscribe to our weekly newsletter. If you haven't signed up yet, please do.

  1. Consumer Choice: As American as Apple Pie / Wenonah Hauter
    The creation of a new genetically modified apple highlights once again the need for clear labeling of this kind of food.
  2. Iran in the Campaign's Crosshairs / Chris Toensing
    Mitt Romney is playing the same cynical game as Benjamin Netanyahu.
  3. The Problem with Craig Romney and his Padre / Jason Salzman
    Mitt's Latino "ambassador" may speak Spanish, but he can't talk about real policies.
  4. The Corporate Court's War on Women / Martha Burk
    So far, not so good.
  5. Apparently, Suite Crime Does Pay / Sam Pizzigati
    The executives responsible for the financial industry's pervasive fraud are paying no personal price.
  6. Big Food Fight / Jill Richardson
    If the products they sell us are as great as they say, what are General Mills, Kraft, and other processed food behemoths hiding?
  7. Big Food Behemoths Embarrass their Organic Offshoots / Jim Hightower
    Big Food's mobilization against California's right-to-know law is making more green-minded consumers aware of the companies that own their favorite brands.
  8. Just Don't Let the Other Side Vote / William A. Collins
    Texas won't accept your student ID for voting, but your gun permit will do just fine.
  9. Poisoned Apple, 2012 / Khalil Bendib (Cartoon)

Poisoned Apple, 2012, an OtherWords cartoon by Khalil Bendib

Civil Society to World Bank President Dr. Jim Kim: Add Your Voice to the Choir of Support for a Financial Transactions Tax

October 9, 2012 ·

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
President
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.

Recommendations:

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,

AFL-CIO, USA
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
Education International
Europeans for Financial Reform
Friends of the Earth U.S. Gender Action,
USA
Global Health Advocates France
Global South Initiative, Nepal
Greenpeace
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
Oxfam International
Positive-Generation,
Cameroon
Public Services International
Réseau Accès aux Médicaments Essentiels (RAME),
Burkina Faso
Robin Hood Tax Campaign,
United Kingdom
Salamander Trust
Stamp Out Poverty,
United Kingdom
TAW AFRICA
TAW-BURKINA
TAW-CAMEROON
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
VOCAL-NY,
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
WWF International

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