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Entries since November 2011Page Previous 1 • 2 • 3 • 4 • 5 • 6
November 4, 2011 · By Sarah Anderson
Talk about piling on. Bill Gates, the Pope, Michael Moore, the Archbishop of Canterbury, 1,000 parliamentarians, 1,000 economists, the world's major labor leaders, Occupy Wall Street protesters, Oxfam and other major development groups, thousands of nurses, the World Wildlife Fund and other major enviros…It might be easier to list who didn't come out didn't come out in support of a Wall Street tax in the lead-up to this week's G20 summit in Cannes.
The outcome? No home run, but some measurable steps forward.
No one expected a G20-wide agreement on taxing financial transactions at this summit. Despite rising support, opposition from the United Kingdom, Canada, and the United States, among others, is still just too strong. But there were high hopes that a subset of European and non-European G20 countries would launch a "coalition of the willing" in support of the tax.
This goal was achieved. In his concluding press conference, summit host French President Nicolas Sarkozy announced that South Africa, Brazil, and Argentina were joining the list of current supporters, including France, Germany, Spain, the European Commission, and several other European governments. Sarkozy said he hopes to move towards implementation in early 2012.
Sarkozy and German Chancellor Angela Merkel have been the strongest supporters of taxing financial transactions for nearly two years. A few months ago, the European Commission also reversed its earlier opposition and released proposed legislation for such a tax in the European Union. But while Europe appears likely to move forward, the addition of several emerging market countries to the supporter list is significant for several reasons:
- The increased revenue that can be generated.
- The reduced potential for tax avoidance.
- The enhanced chances that revenue won't just be plowed into European bank bailouts, but instead spent on human needs in both the global North and South.
- The strengthened legitimacy through the backing of rising powers in the Global South.
For U.S. advocates, there was another modest victory. Over the past two years, Treasury Secretary Timothy Geithner has made no secret of his aversion to the tax. In September, Geithner angered some of his European counterparts by objecting to proposals to raise funds to address their deficit problems through an EU-wide tax on financial transactions.
In Cannes, the Obama position shifted from active blocking to friendly neutrality.
"The president made clear that he shares the objectives that Chancellor Merkel and President Sarkozy have in ensuring that the financial sector contributes an appropriate share to the resolution of crises," said Michael Froman, the White House's G20 point person. "I think there is broad consensus between the Europeans that the president met with this morning and ourselves about the ability of each to pursue this in their own way, whatever way they see to be most effective."
The final communiqué of the G20 leaders was a disappointment, however.
The only relevant line in it is a typical diplomatic non-statement: "We acknowledge the initiatives in some of our countries to tax the financial sector for various purposes including a financial transaction tax inter alia to support development."
But with the likelihood of a critical mass of countries coordinating taxes on financial speculation, this kind of mumbo jumbo may disappear in the coming years. Once other governments start generating massive revenues by taxing speculation, even the most closed-minded economic advisers in this country may see the issue anew.
Sarah Anderson directs the Global Economy Project at the .
November 4, 2011 · By John Cavanagh
Could any of us have imagined that in six short weeks, the people of this country would have found our voice? Most of you reading this have likely participated in Occupy activities in your town or city. IPS board member Barbara Ehrenreich worked with IPS interns to create a massive list of phone numbers of mayors of Occupied towns. They came up with over 400 places where people are standing up to be heard.
These are days of action. I've just returned with a group of IPS colleagues from the U.S. Treasury Department where National Nurses United led thousands of us in a protest for a measure that IPS has been advocating for years: a Wall Street tax that would curb financial speculation and generate tens of billions of dollars that can be used to create jobs and help the environment. Tomorrow night, IPS and the Other 98% and thousands more will march from Occupy DC to protest a gala dinner backed by the Koch brothers.
On Saturday, tens of thousands will join in a "move your money" day that uses our power to defund Wall Street banks and build up Main Street banks. And, on Sunday, thousands more will create a human chain to surround the White House to demand an end to an oil pipeline that would despoil land and water from Western Canada to the Gulf of Mexico.
The 99 percent have found our voice and at IPS we are devoting every ounce of our energy to filling this new public space with the true picture of the obscene inequality that our corporations and U.S. policy have created over the past three decades. We have a team at IPS, led by Chuck Collins, that is both putting out daily facts and figures on inequality and is steering people toward creative action. Chuck himself is now working on a book to trace the gap between the 99 percent and the 1 percent (help us decide on a title for the new book).
And, working with allies at YES! Magazine and elsewhere, we have built up a New Economy Working Group that is illuminating the path from this failed Wall Street economy to a green Main Street economy – an economy that is ecology balanced, that eliminates extreme inequality, and that nurtures the democratic expression that is blossoming across this country. IPS is producing fact sheets, leading workshops at Occupy sites, sending op-eds to papers all over the country, and giving voice to the rising tide of moral outrage.
The Occupy outpouring is changing the entire debate in this country. Newspapers are reporting on inequality. Politicians are being forced to respond to the charge that their policies lavish favor on the 1 percent. Banks are canceling outrageous fees on consumers. Conservative officials in Ohio and Wisconsin are feeling more heat to maintain protections on workers and communities. As we change the national conversation, we can dismantle the barriers to change.
This is your moment and IPS is proud to walk down this path with you. Sign up to receive our Unconventional Newsletter every two weeks.
November 4, 2011 · By Janet Redman
In December 2008, in the eleventh hour of two weeks of intense negotiations over the future of a global climate deal, negotiators sat exhausted and exasperated as the team from the United States moved to block a temporary agreement. Visibly frustrated, the lead negotiator for Papua New Guinea growled at the US, “If you can't lead then get out of the way.” The room exploded in applause, and the US backed down.
Flash forward three years and the United States, now under what was supposed to be a progressive administration, is standing in the way of other countries’ progress again. This time a coalition of the willing in Europe – led by French president Nicolas Sarkozy and German chancellor Angela Merkel – are laying plans to put a tiny tax on financial speculation by big banks and financiers who treat the global economy like their own personal casino.
A financial speculation tax (a.k.a. FST, Robin Hood tax or financial transaction tax) could raise serious money – on the order of $400 billion per year, and groups that are worried about the impacts of climate change think that this is one of the best proposals out there for generating some of the money developing countries desperately need to adapt to a warming world and to build low-carbon economies.
The Obama administration – and in particular Treasury Secretary Timothy Geithner – has staunchly opposed taxing the Wall Street casino at home. But in a serious overreach of power, they’ve threatened to stop any mention of France and Germany’s proposal for the tiny tax in the G-20 Summit underway in Cannes, France.
In response, major US organizations including Oxfam America, Greenpeace USA, 350.org, and Church World Service States sent President Obama and key members of his administration a letter urging the US to, once again, step out of the way of internatinal progress.
Here's the full text of the letter, and the list of endorsing organizations:
Dear Mr. President,
We write to urge you to signal support for European countries’ proposal for the G20 summit in November 2011 to endorse countries’ use of a financial transaction tax. It is dismaying that, according to recent reports, your administration has repeatedly objected to European efforts to put such a tax in place, even for themselves. We believe this obstructionism is deeply misguided. A negligible levy on the financial sector has shown great potential to address growing inequities in the financial system, and to help prevent financial crises in the future.
A small tax on the trading of stocks, currencies, derivatives and other financial assets has the power to raise hundreds of billions of dollars a year while discouraging dangerous financial gambling and rapid, high-volume speculative trading. Funds raised by the tax should be used to strengthen broad-based economic prosperity and human security by creating green jobs, improving livelihoods and global health, and following through on critical climate change finance commitments to developing countries.
The idea of a small fee on the sale of financial transactions is not new. Such taxes have a long track record in many of the world’s leading economies. The United States, for example, had a transfer tax from 1914 to 1966, which levied a 0.20 percent tax on all sales or transfers of stock. In 1932, Congress more than doubled the tax to help financial recovery and job creation during the Great Depression.
Today the idea is supported by many G20 leaders, including French President Sarkozy and German Chancellor Merkel, and innovative sources of finance remain high on President Sarkozy’s list of priorities for the G20 Summit. The European Commission recently published legislation for a European financial transactions tax. Bill Gates will formally present a report on development finance at the G20 in which he is expected to identify a financial transaction tax as one of the most credible and feasible sources of innovative finance. The IMF has also published papers noting the feasibility of such a tax.
But, Mr. President, while momentum builds in Europe your administration continues to block progress. We were deeply disappointed when reports from last month’s meeting of European Finance Ministers revealed that Secretary Geithner repeatedly discouraged European countries from moving forward with a financial transaction tax – even amongst a “coalition of the willing.”
Public anger is growing over Wall Street bailouts, record corporate executive excess and broken promises to build a clean economy. The “Occupy” movement is proof of that anger. You have an opportunity to stem this frustration by bringing a message of encouragement for a European financial transaction tax to the G20 Summit.
We, the undersigned organizations, call on your Administration to take a bold stand against Wall Street greed and negligence and stand for accountability and economic justice by supporting European leaders’ action on a financial transaction tax at the G20 in Cannes.
Affording Hope Project
Center for Biological Diversity
Center for Community, Democracy and Ecology
Center for Participatory Research and Development
Center of Concern
Chesapeake Climate Action Network
Church World Service
Foreign Policy in Focus
Friends of the Earth U.S.
Grassroots Global Justice Alliance
Holy Cross International Justice Office
International Forum on Globalization
Jubilee USA Network
Maryknoll Office for Global Concerns
Movement Generation: Justice & Ecology Project
Oil Change International
Pan Africa Climate Justice Alliance
Sustainable Energy & Economy Network, Institute for Policy Studies
Tax Justice Network USA
United Methodist Church, General Board of Church and Society
Women's Environment and Development Organization
cc: Secretary Timothy F. Geithner, Department of the Treasury; Michael Froman, Deputy Assistant to the President and Deputy National Security Advisor for International Economic Affairs
November 3, 2011 · By Sarah Anderson
The world's second-richest man and a group of American nurses on the frontlines of the Occupy Wall Street protests came to the G20 summit in Cannes, France this week to advocate for the same thing.
Bill Gates came because French President Nicolas Sarkozy asked him to give G20 leaders recommendations on how to raise funds to meet the needs of the world's poorest. Among Gates's proposals: a small tax on trades of stocks, derivatives, and other financial instruments, also known as a financial transactions tax (FTT), Wall Street speculation tax, or the Robin Hood tax.
According to an advance copy of Gates's report, "FTTs already exist in many countries, where they generate significant revenue, so they are clearly technically feasible. According to the IMF, 15 G20 countries have some form of securities transaction tax. In the seven countries where the IMF estimates revenue, these taxes raise an estimated $15 billion per year."
"It is very plausible that certain kinds of FTTs could work," Gates told the Guardian. "I am lending some credibility to that. This money could be well spent and make a difference."
Gates has a net worth of $59 billion. So forget the 1 percent, he'd be in what, the top 0.001 percent? Meanwhile, representatives of the 99 percent were outside the summit security zone, plugging the same idea.
National Nurses United, the largest union representing U.S. nurses, came to France from the Occupy Wall Street protests across the United States where they have been providing first aid for the encampments. In Cannes, they dressed in their scrubs and joined nurses from Australia, France, Ireland, and Korea. This global group then administered an FTT saline drip to an ailing world economy — represented by a man painted in full body art as the Earth.
"The economic decline is literally making our patients sick," said one of the U.S. nurses. "We see more and more children with conditions related to poor nutrition and stress." The solution, according to the nurses, is a Wall Street tax that could generate the revenues needed to address human needs.
Bill Nighy, an actor famous for his roles in "Love, Actually" and other British films, jumped right into the world economy's hospital bed and posed for photos. "People around the world are dying of illnesses that should have been eliminated hundreds of years ago," Nighy said, noting that a new Wall Street tax could help raise the money required to stop those scourges.
One of his contributions to the campaign for such a tax in the UK was a video that went viral, in which he plays a banker trying to argue against the idea. Ultimately, his character can't find a good reason why not to raise huge amounts of money for the things people need through a tiny tax on financial transactions.
Back inside the summit venue, there's a frenzy of last-minute lobbying going on to try to line up a group of G20 governments to launch a “coalition of the willing on FTT.” The Obama administration isn't expected to be on the list.
But RoseAnn DeMoro, National Nurses United's executive director, said, “Nurses don’t give up on people and they won’t give up on this.” The union also spearheaded a rally in Washington, DC today, with more than a thousand nurses and their allies targeting opponents of the Wall Street tax in the Treasury Department and Congress.
Sarah Anderson directs the Global Economy Project at the .
November 2, 2011 · By Sarah Anderson
Signs of a New World Order are everywhere here in the French Riviera, as the elite city of Cannes hosts the G20, the ultimate elite club.
The local business rag, the Riviera Times, trumpets a recovery of the tourism business during the 2011 summer season — thanks to a 50 percent increase in visitors from China. In my hotel lobby there are stacks of China Daily, but no such freebies from the newspapers of the Old World Order powers.
Walking by the kiosks, though, I see European headlines rejoicing at the likelihood that China will aid in the Greek bailout. The head of the European Financial Stability Facility, the pot set up to rescue basket case countries, traveled to Beijing last week and rattled a tin cup for donations from China's $3 trillion reserve fund. This comes amid news that Chinese investors have acquired distressed Swedish carmaker Saab. (They already own Volvo.)
How will China's juggernaut status affect the G20's agenda? In both positive and negative ways, in my view.
On the positive side, they could hold some of the other governments' most extreme free market tendencies in check. Take, for example, some of the positions the Obama administration is pushing in bilateral and regional free trade agreements. In the recently signed treaties with Panama and Colombia, it pushed through new rules that ban the use of capital controls, despite the fact that many countries are using these policy tools to combat financial volatility and the International Monetary Fund is recommending them in certain circumstances. The Chinese government, a capital controls user, would never go along with it if the Obama administration tried to push such nonsense at the global level.
In the nine-party talks for a Trans-Pacific trade deal, the Obama administration is apparently pushing for a rollback of Bush administration concessions to allow greater access to affordable medicines under the intellectual property rights rules of trade agreements. According to a Public Citizen analysis of leaked position papers, U.S. negotiators are seeking to increase the rights of pharmaceutical firms to challenge policies of New Zealand and Australia that are designed to keep down drug prices. Again, China would be highly unlikely to roll over if the U.S. pharmaceutical industry tried to obtain such rules at the global level.
On the down side, China's tremendous power will likely mean that all the G20 rhetoric to address current trade imbalances through "sustainable and balanced growth" will come to naught.
In a Financial Times commentary, President Barack Obama repeated the mantra that "for countries with large surpluses, it means working to boost domestic demand. A critical tool for accelerating that shift is greater flexibility in exchange rates, including exchange rates that are market-driven." This is all just diplomatic code language meaning that China should expand social programs, let wages rise by respecting basic labor rights, and stop undercutting competition by keeping the renminbi undervalued.
Chinese officials have dragged their feet on all of these fronts. And with their newfound status as a global rescuer, they are unlikely to take action any time soon. Li Daokui, a member of China's central bank monetary policy committee, told the Financial Times that the Chinese government might even condition their support for the Greek bailout on an end to European criticism of their currency policy.
It's ironic indeed to see the Old World Order powers now so eager to benefit from Chinese reserve funds. These funds were, after all, accumulated through the aggressive export strategy that has so rankled the West.
Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies in Washington, DC, and is a civil society observer at the G20 Summit in Cannes, France. This post also appeared on the Triple Crisis blog.