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1. SDGs and the Redistribution of Wealth for “Saving the World in a Hurry”
Is a Higher ‘Quality of Life’ a Bulwark Against Disaster?
Rapporteur: Shane Roberts
The six threats of the Project to “save the world” are described as “causally inter-dependent” and requiring “systemic change”. This points to a complex world, where any problem, cause, effect or solution related to each threat may be given a simple label that masks an underlying complexity, e.g. in a mesh of chicken-and-egg dilemmas about where to start: everywhere at once?
So it is with the Project’s roster of solutions, wherein ‘plank’ #21 in part states that “All states shall support SDGs” and in so many words arguably calls for a redistribution of global wealth. Between the SDGs and the notion of redistributing wealth, we have landed in a sea of complexity – theoretical and practical. To start with, what are the SDGs, and what might one mean by “wealth” and mechanisms for its redistribution?Read more
In 2015, the General Assembly of the United Nations approved a historically ambitious 35-page plan entitled Transforming Our World: the 2030 Agenda for Sustainable Development. It comprises 17 “Sustainable Development Goals” or “SDGs” (listed below) along with 169 associated targets that are sweeping in scope and call for actions to raise the quality of life for people in both developing and developed countries, and to secure a decent future for all of us.
The SDGs are a constellation of entwined objectives for making a better world for all – a multi-pronged approach to interlocking problems confronting societies in greater and lesser degrees around the globe. While achieving any Goal will have monetary costs, the Goals in the first instance, i.e. as stated, are effectively non-monetary ‘instruments’ (means and measures) for transferring to have-nots various non-capital equivalents of “wealth” tied to quality of life. At the same time, the aim of many Goals is to empower individuals and communities to be able in the future to earn/acquire wealth (or what it can buy) on their own and maintain an ongoing capability to do so (e.g. see how instrumentally #4 is tied to #s 2, 3, 5 and 8) all the while in an eco-sustainable way.
So how could the SDGs stave off any of our six existential threats?
First let’s consider that any threat is just one factor in a risk equation. Another key factor is what targets (e.g. assets and activities) they pose a risk to, and the attributes of those targets (especially their ‘vulnerability to’ or ‘resilience against’ the threats) be the targets, for example, humans, crops, communities, infrastructure et cetera that might be threatened, and whose loss could set back progress to a better quality of life. And let’s consider, too, why we should be concerned, even if we and ours are not immediately direct targets.
A short answer to the latter question is that deprivation and suffering anywhere can breed risk – sometimes minor and historically sometimes catastrophic. So, even if we are not concerned in the first instance about universal justice or humanitarianism, one might support transfer of wealth, in one form or another, to advance the SDGs, as they can indirectly (in the dynamics of a complex system), if not directly, reduce risks by reducing the threat or by ‘hardening’ the target against the threat.
Let’s consider the risk of a pandemic. While even the healthy and wealthy can catch infectious diseases, the risk of a pandemic is higher where disease can first freely incubate, mutate and spread among the poor and the ignorant (not necessarily the same, as is shown by anti-vaxers), before it explodes onto the global stage. So a nutritious diet (SDG#2), education (#4) and decent jobs (#8) are interacting builders of resilience in the original population and consequently elements of defense for the global community.
The most dangerous risk could turn out to be global warming because of its high likelihood of reaching dangerous levels and its insidious nature as a pervasive destabilizer that threatens to facilitate three of the Project’s threats. First, global warming is fueling the spread of nasty diseases previously confined to near-equatorial regions. Second, global warming is threatening food security through three processes: spreading crop and livestock diseases; engendering extreme weather that trashes crops; and ‘cooking’ staple crops (including rice) that have a curvilinear response to temperature, i.e. a goldilocks dependency, neither too hot nor too cold. Three, food insecurity (i.e. not even famine but the fear of it) brought on by episodes in destructive weather have already been tagged as drivers to a wave of violence in 2008 among the poor in 30 countries, the trigger to the Arab Spring in Tunisia, and the first domino in a cascade that led to Syria’s civil war.
SDG#13, action against climatic change, may be one of the globally most strategic priorities for peace as well as prosperity. And without transferring ‘wealth’, in the form of techno-scientific expertise, technology for clean energy, and ‘defenses’ against the impacts of global warming in the interim, the developing world is going to be a ‘breeding ground’ for risks to us all.
Transforming our world: the 2030 Agenda for Sustainable Development
(Approved by the UN’s General Assembly, September 2015)
- End poverty in all its forms everywhere
- End hunger, achieve food security and improved nutrition and promote sustainable agriculture
- Ensure healthy lives and promote well-being for all at all ages
- Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
- Achieve gender equality and empower all women and girls
- Ensure availability and sustainable management of water and sanitation for all
- Ensure access to affordable, reliable, sustainable and modern energy for all
- Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
- Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
- Reduce inequality within and among countries
- Make cities and human settlements inclusive, safe, resilient and sustainable
- Ensure sustainable consumption and production patterns
- Take urgent action to combat climate change and its impacts
- Conserve and sustainably use the oceans, seas and marine resources for sustainable development
- Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
- Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
- Strengthen the means of implementation and revitalize the Global Partnership for Sustainable Development
2. Universal Basic Income
Rapporteur: Robin Collins
For the purposes of this short introduction, we see UBI as one of several mechanisms that can be used to fundamentally stabilize living conditions, and thus alleviate factors that contribute to several existential threats in the Platform for Survival, including climate change and conflict that can lead to war/nuclear war. As economist Myron Frankman points out,
“’Everyone’ seems to be talking about basic income, but generally at the level of sub-national units and with at best a very hesitant pilot project with conditionalities and exceptions. These rarely lead to the establishment of a full-blown commitment. There is no conviction that this should be a right of residents or citizens of a well-defined political unit, whether local, sub-national or national. Meanwhile many types of employment are disappearing. Environmental displacements of human populations are becoming more frequent with diminishing opportunities for resettlement. The Mediterranean Sea has become a veritable graveyard. We barely trouble to do more than shake our heads when we read of the latest genocide, such as that of the Rohingya.
“A planet-wide unconditional citizen’s income and open borders should be seen as critical conditions for human survival in a world where we are connected electronically but physically separated by border walls and increasingly subjected to unpredictably destructive natural forces which humanity has unleashed. ‘When the dust finally settles, we may realize that the attainment of substantive global democracy, peace, and justice was the cultural impact of the electronic process.’ Basic income and open borders facilitated by the ‘electronic process’ may well be the only option to humanity to weather the unpredictable disruptions that lie ahead.”(1)
A fundamental premise of UBI is that a better way to distribute wealth is needed to ease conflict, save the planet, and deliver income and jobs more fairly to reduce poverty. Basic Income is a “regular income paid in cash to every individual member of a society, irrespective of income from other sources and with no strings attached.”(2) There are several reasons why a Basic Income is of broad interest in recent times. One is a new generation of automation that has begun to radically change how jobs and incomes are distributed (from self-driving cars and delivery, robotics, banking and finance, travel industry to artificial intelligence.)(3) Automation leading to joblessness has been argued before, but the trends towards precariousness seem to be of greater concern than ever.
Globalization is accentuating the polarization of these processes. There is an earnings divide, producing extreme wealth for a relative few, and huge resentments for those who are impoverished and losing ground on the job front. It is expected that the new wave of automation will worsen disparities within countries and between countries. The World Economic Forum suggests: “It is clear from our data that while forecasts vary by industry and region, momentous change is underway and that, ultimately, it is our actions today that will determine whether that change mainly results in massive displacement of workers or the emergence of new opportunities. Without urgent and targeted action today to manage the near-term transition and build a workforce with futureproof skills, governments will have to cope with ever-growing unemployment and inequality, and businesses with a shrinking consumer base.”(4)
Ecological limits to growth have been expounded for several decades but the consensus now in 2019 is that climate change is noticeably being driven by industrial production, population growth, energy use, and these produce carbon-based gases. Much of the world is facing a climate crisis that is expected to worsen.
A Basic Income for all is not a new idea, and variations of it were advocated by John Stuart Mill, Bertrand Russell, Thomas Paine, the “utopian socialist” Fourier, social-credit founder “Major” Douglas; and in modern days: Milton Friedman at one end of the economist spectrum, and John Kenneth Galbraith, and James Tobin (Tobin Tax) at the other. There have been left of centre and right of centre advocates; different levels of political party commitment over the years have come from socialists, greens, liberals and conservatives.
“The idea of an unconditional basic income has three historical roots. The idea of a minimum income first appeared at the beginning of the 16th century. The idea of an unconditional one-off grant first appeared at the end of the 18th century. And the two were combined for the first time to form the idea of an unconditional basic income near the middle of the 19th century.”(5)
Variations of the basic income proposal have been experimented with in several parts of the world. In the 1970s it was discussed widely in Denmark. In the Netherlands, in 1976, J.P. Kuiper “recommended uncoupling employment and income as a way of countering the de-humanizing nature of paid employment: only a decent ‘guaranteed income’, as he called it, would enable people to develop independently and autonomously”.(6) Britain, Germany and France showed interest in UBI through the 1980s.
In Alaska a basic income plan was implemented beginning in 1982, initially to be based on years of residency. Since then 650,000 people have received a modest supplement to their incomes, $300 per person/year initially, $2000 in 2000, and by 2008, payments were $2069 per person.
From 1974 to 1979, a basic income (guaranteed annual income) experiment was tried in Dauphin, Manitoba, known as Mincome, and was funded by the provincial social-democratic government with support from the federal Liberal government of Pierre Trudeau. One study of results showed that hospital visits dropped by 8.5% due to improved health outcomes. However the program duration was too brief to draw detailed conclusions. A three-year program was begun in 2017 under the Liberal government of Ontario, but was stopped when the Ford Progressive Conservative government came to power in 2018.
There are many versions of the Basic Income idea. One way of looking at the proposal is as having five fundamental elements:(7)
- Periodic: it is paid at regular intervals.
- Cash payment: It is not, therefore, paid either in kind (such as food or services) or in vouchers dedicated to a specific use.
- Individual: it is paid on an individual adult basis—and not to households.
- Universal: it is paid to all, without means test.
- Unconditional: it is paid without a requirement to work or to demonstrate willingness-to-work.
The cash value of UBI needs to be low enough to be affordable, but high enough to make a difference. Ballpark income estimates developed by Parijs and Vanderborght are as follows (2015): $1163/month (USA), $1670 (Switzerland), $910 (UK), $33 (India), $9.50 (Democratic Republic of the Congo). [All in $US.] “A worldwide basic income funded with a quarter of world GDP would come to about $210 per month” per person, although the authors admit that the ¼ GDP proportion is somewhat arbitrary, and not written in stone.
They believe, however, that what makes Basic Income different from other poverty alleviation schemes is that BI is individual, universal and obligation-free. By individual is meant the resource is given to each adult citizen, not to the “head of the family”, thus distributing the power throughout families. (If given to minors, it would be distributed through an adult parent.) By universal is meant that there is no means test, no distinction between wealthy and poor. Those with higher income will effectively fund their own payment through taxation, and in that sense there is a progressive redistribution of UBI. Studies have found universality works better than simply subsidizing the poor, for reasons of simplicity, elimination of means test, uncertainty in job status and the shaming factor. In addition, earnings over and above the UBI would be real gains for lower income citizens, and would therefore encourage the search for productive work, rather than be a disincentive, as in the case of a claw-back. By being obligation-free, “homemakers, students and tramps are entitled to it no less than waged-workers and the self-employed”.(8)
Key Critiques and Responses
Some argue that without improved high quality, universal public service, “UBI doesn’t stack up.”(9) Because the global cost of UBI is “high”, as estimated by the International Labour Organization to be about 1/3 of GDP (and with a similar amount going to current public service spending), dramatic increases in public revenue will be needed. Otherwise UBI will displace public services. Free health and education are strong measures to alleviate poverty, and shouldn’t be jeopardized, they insist. Andre Picard argues the opposite, which is that “the way to keep people healthier longer is to ensure that they have a decent income, a roof over their heads, healthy food, a good education, a sound physical environment and sense of belonging. These building blocks are what academics call the socio-economic determinants of health”(10)
The freedom and opportunity provided by UBI avoids the “employment trap’, which is opportunistic exploitation by employers, and work-conditional benefits. UBI increases flexibility in both choosing jobs and leaving unattractive jobs. This should encourage employers to adjust compensation levels closer to the true value of work done.
One estimate is that UBI would cost $4 trillion per year at the rate of $1000 per month in the United States alone, which is on the scale of the entire US 2018 budget. (This critic argues instead for a guaranteed basic income, which transfers money only to those whose income is below $1000/mth. It would, however, therefore not be universal, and require a means test.) So, if fewer people are working to produce value and goods, how will a universal system be financed?
In developed countries, the simplest way to finance UBI is through the rejigging of the progressive personal income taxation system. A second way is to “tax capital directly through a steeply progressive personal-wealth tax”. A third way is through additional corporate taxes. Fourth is through inheritance taxes, taxes on bequests and gifts.
Public ownership of natural resources is seen as a key source of income generation, through land rental (Thomas Paine’s proposal), through sales of non-renewable natural resources, sale of non-renewables to create a sovereign fund (as in Alaska), sin taxes, and Tobin taxes on investment transactions and speculation (see further discussion within this Platform plank.) What is common within the many proposed sources of revenue for UBI is higher taxation of wealth, and fairer distribution of these outputs throughout society.
Aside from cost, another key criticism of UBI is that it will disincentive the desire to work by giving away minimum income needed to live on: The world will be filled with lazy people living off the work (what there remains of it) of others. Four American studies of the Manitoba experiment argued that the work disincentive was estimated to be 5-10%.(11) A primary objection to UBI, therefore, is that “work is part of the good life and hence that an income granted without some work requirement amounts to rewarding vice: idleness…” In Jon Elster’s formulation, this “goes against a widely accepted notion of justice: it is unfair for able-bodied people to live off the labor of others.”(12)
There are several responses to this concern. One is that an unconditional BI would encourage the “ethos of contribution”, not discourage it. As well, if denying income to the non-working poor is justified, the same should be the case for the non-working wealthy.
When we argue for the reduction in the length of the work week (adding weekends, reducing to four-day weeks) which becomes possible and sensible with technical progress, we do it to more fairly “share a privilege” and to improve quality of life, not to encourage sloth. It is also expected that only a tiny percentage of people will free-ride the UBI system and do nothing. This, write Parijs et al. is because “the universal nature of a basic income, which makes it combinable with recipients’ other income, gets rid of the inactivity trap created by means-tested schemes. Moreover, experiments […] suggest that even when freedom from obligation causes a falI in the labor supply, this does not translate into an expansion of leisure as idleness, but rather into an upsurge of productive activities in a broader sense such as education, childcare, and engagement in the community.” There is also expected to be a significant concomitant improvement, therefore, to the current dilemma of unpaid domestic work. “Homemaking”, home care of children, the elderly, the disabled, and parental tasks outside the traditional paid workforce would become, in effect, UBI-paid tasks. This could also contribute to a fairer distribution of what are now mostly gendered tasks or burdens.
Nation State and Beyond
The Universal Basic Income is seen to be organized through governments within nation states, either federally, provincially/state level, or even locally. However, it “can also conceivably be paid by a supra-national political unit. Several proposals have been made at the level of the European Union (see Genet and Van Parijs 1992) and some also, more speculatively, at the level of the United Nations (see e.g. Kooistra 1994, Frankman 1998, Barrez 1999).”(13)
3. The Tobin Tax is One Painless Way to Redistribute Global Wealth
Rapporteur: Robin Collins(14)
Tobin’s Tax in brief
Much human interaction has been increasingly globalized. That includes participation in financial investment, communications and trade, some of which involves negative planet-wide environmental, military and development impacts. Yet taxation has overall remained in the domain of national jurisdictions – primarily because national governments have been reluctant to give up their sovereign control over tax revenues. There are political implications to international taxation being levied by international institutions, although no more so than the international spheres already commanding virtually every other human activity. As was pointed out in one 1996 study on the potential for generating international taxation revenue, “economic liberalization and the internationalization of markets, especially that of financial markets, have affected the taxation capacity of nation-states. Global taxes, such as the Tobin tax, applied across all countries, could help restore some of the taxation power governments have lost in these globalization processes.”(15)
James Tobin, in 1972 at Princeton University, proposed a levy on international currency transactions as a way to “preserve some possibilities of autonomy in national or continental monetary policies” that were wracked by the anarchy of money markets. He initially proposed that a 1%, and later a 0.5% tax on currency conversions should be considered a means to deter rampant quick-turnaround currency speculation, and as a bonus, also a way to generate significant revenue through a relatively small penalty.
The problem of currency speculation worsened dramatically since the days when Nobel laureate Tobin’s idea was given an admittedly poor reception. In the early 1970s the global daily turnaround in foreign exchange markets added up to US$18 Billion. Twenty years later, the average daily movement of currency exchanges was $1.3 Trillion. In 2016, it was US$5.4 Trillion. To highlight the speculative aspect and scale of this movement, one can compare the annual global trade in goods and services – in other words, real products – which in 2017 was US$23 Trillion.
Tobin’s tax returned to the discussion table for this reason, but also because interest in the idea “is shared by those concerned with public financing of development – the fiscal crisis of the state as well as the growing need for international cooperation on problems such as the environment, poverty, peace and security…”(16)
The feasibility of enforcing a Tobin-like tax as it would apply to international financial trading is the subject of much debate. While the jury is clearly still out, although less so than some think, the then-25-year-old idea was tackled once again in 1996 at the annual meetings of the American Economic Association. Stanley Fischer, chief economist at the IMF was also favorable to a Tobin tax as a useful measure if enforcement problems could be solved. While opposition has been strong from central bankers, it was of interest to France’s François Mitterand at the World Social Summit in Copenhagen (1994) and it was “on the fringes” of discussion at the 1995 Halifax G-7 meeting. It had reappeared during the October 1987 stock market crash, again in 1992 with the crisis of the European exchange rate and in 1994 with the collapse of the Mexican peso.
When a financial crisis arose at the United Nations, it led to the proposal that UN programs be funded from global, rather than national sources. “Such a shift,” wrote Stephany Griffith-Jones, “would allow the UN to more effectively promote “international public goods” and fight “international public bads” – activities that are increasingly important in a world that is becoming more and more interdependent. The Tobin tax seems to be a prime candidate…” The 1994 Human Development Report supported such a tax arrangement and the UNDP looked at the feasibility of the Tobin project. In 2011, the UNDP revisited the idea and published The Currency Transactions Tax: Feasibility, Revenue Estimates and Potential Use of Revenues.
Eventually a national variant of the tax was implemented in several fast-growing centers, including Hong Kong, Seoul, Mumbai and Johannesburg, where it is said to accumulate over US$15 Billion, combined, a year.
A European Union Financial Transaction Tax (EU FTT) plan was proposed to begin in 2014, then was postponed. In the EU, eight or more governments can cooperate on legislation if a majority of members don’t oppose it. A group of eleven has expressed interest. While not all European states are happy about an FTT/Tobin-type tax, a poll in 2011 showed that there was strong popular support, in the order of 61% in favour. Another poll found that 80% of the population in UK, France, Germany, Spain and Italy supported such a tax if it was used to address problems such as the economic crisis. And in Britain, the support was apparent within all three of the major political parties. A study by the Economic Policy Institute in 2016 determined that a well-designed financial transaction tax placed on the sale of stocks, bonds, derivatives and other investments would be “an efficient and progressive way to generate tax revenues”, creating revenues between US$110 and $403 Billion. It would, as the report put it, “help Wall Street work for Main Street”. Support for an FTT was evident in legislative bills put forward to the US Congress by Democrats Keith Ellison and Chris Van Hollen, as well as in support from Independent Senator Bernie Sanders.
Revenue Generation originally not the main motivation of Tobin tax
Tobin believed in 1978 that a universal transaction tax would raise huge revenues and that those funds should be devoted to “international purposes”, although the raising of funds was not his main motivation for the tax. The prime purpose of the tax was to deter speculation and the devastation that money movements cause to national economies. Later, Tobin believed the tax should be as low as .1% of transactions, in order not to “swamp the normal commission charged.” Others argue for either lower or higher tax rates. But Tobin also suggested that some of the political problems of imposing an international tax over sovereign nations might be alleviated by “sweetening the pill” and allowing countries to keep at least half of the revenues or “to choose – among internationally agreed alternatives – where the tax revenues would go.” That strategy for buy-in might be crucial.
A currency transactions tax is only one on the list of sources of revenue from sins that might be converted to international uses. A carbon (environmental) tax, an international air flight tax, and telecommunications taxes are other sources of global commons-like tax funds. International taxes on the arms trade (in the absence of a ban!), and on tobacco and alcohol, would undoubtedly be simple to sell. As unpopular as taxes are, those that are virtually imperceptible and applied to unpleasant human activities that have global reach or environmental implications, may be viable if the revenues generated serve popular purposes, and the taxation mechanisms are easy to apply and seen to be applied fairly.
It is popular to draw attention to the breakdown in international cooperation. Yet governments do resort to cooperative engagement, from the Montreal Protocol banning CFCs, to the World Trade Organization, and the Paris Accords. Raising revenue through tax may be less a concern given the rise in perception that we all face existential global threats.
Is a global consensus on new taxation possible?
The applicability of an international tax on anything, and the subsequent good faith use of the revenue generated by that tax presumes in part that a global consensus can be manufactured in the first place. A tax that is not supported, obviously will not be systematically applied, and (particularly in the absence of simple enforcement agencies) will be avoided. If some avoid, others will follow and the process may cease to function entirely. Peter Garber(17) describes the effect of a single dissenting financial centre: “As market participants try to avoid the tax, its implementation will immediately push foreign exchange transactions out of the taxed centres [and into the tax-free area].” On the other hand, if all major financial centres participated in the implementation of the tax, “cooperation would make the tax more difficult to circumvent; thus, it would generate more revenue.”
Opposition to Tobin’s tax, as applied to financial exchanges, is strongest from the speculating community who see it as interference in their speculation on mobile financial capital through different currencies. Writes Jeffrey Frankel, “for the policy to achieve any of its goals, it would have to be the outcome of an international agreement that was virtually universal […]. Enforcement could even be a problem if all countries were to sign an agreement…[but] if the problem of international agreement could be solved, there is no reason to think that enforcement would be more difficult for financial transaction taxes, as compared to, say, income taxes.”
The likelihood of evasion by states would be inversely proportional to the advantage gained by supporting the tax. States with severe economic hardships should be most supportive of a tax that generates revenue earmarked to alleviate their own concerns. Many would also not be among the list of likely safe bases for speculators seeking to avoid the tax. Other potential havens might be deterred by penalties imposed by the larger financial markets (which would have to be supportive if the tax was to work in the first place.) And if the tax were small enough, would an attempt to circumvent it be worth the effort? A key premise of the Tobin tax concept is that small taxes applied to massive numbers of transactions will generate a goodly amount of virtually pain-free revenues. There is a balance to achieve between the tax as deterrent – its primary goal – and the tax as inspirer of evasion – causing it to be ineffective.
An international agreement to impose a tax regime could be generated by a ratifiable convention that is renewed regularly. The international agreement could be coordinated and supervised by the International Monetary Fund, (or Bank for International Settlements, or the World Bank). That or another (or new) international organization could be authorized to draft a tax code, to amend and interpret the code and to collect the taxes for stipulated international programs.
How much tax?
As would be expected, estimates vary as to the level of revenue generated from currency exchange transactions (alone), even taking into consideration the revenues effectively deterred by the application of the tax. Using a .1% Tobin tax on exchange rate transactions, Jeffrey Frankel estimated that $176 billion in tax revenue could have been raised in 1995. British journalist Martin Walker once proposed that a .003% tax would fund UN peacekeeping. Today, UNPK costs US$6.9 Billion annually, a small fraction of even the low end revenue predicted by Birens and Blair (2016).
While the tax level could be determined at an international level, it was suggested by Inge Kaul and John Langmore(18) that it be collected by national governments who would control the proceeds. This could encourage national buy-in. To avoid distresses from global reach into sovereign jurisdictions, states could contribute a proportion of the proceeds as they currently do to distribute ODA, indicating their preferences from among the agreed global needs. Alternatively, there could be established a new international Treasury-like cooperation fund (possibly modeled on lessons drawn from the experience of the European Union.) In any case a cooperative spirit would be necessary, and in the absence of that spirit, success would be limited. Yet, national governments should be keen on replenishing departmental coffers with their allotted national share of the transactions tax revenue pot.
Among the potential international uses for the funds generated by a Tobin tax/FTT might be expenditures in the areas of controlling air pollution, climate change initiatives, refugee settlement, a UN Emergency Peace Service, maintaining peace and security, and preventing the spread of infectious diseases.
Few objections on moral grounds deserve the undue attention of critics of international taxation schemes if the cause is human survival. Such a tax is cost effective and saves money in a relatively short period of time; it can be virtually imperceptible, and its “burden” is shared by the international community. What’s not to like?
Dissent will be from those who are concerned that the imposition of a new international tax may establish feared irreversible interference in national finances. However, the system could be instituted so that it is annually renewable, and so that budgets are tightly coordinated with the actual costs of projects the funds are collected for. Enthusiasm for the project may tightly track the proportion of the tax revenue that participating countries themselves accrue.
However, in the context of global existential threats, let’s be frank: The core argument should be about how much is needed to avert crises, not how much interference is too much.
A Financial Transaction Tax Would Help Ensure Wall Street Works for Main Street, by Josh Bivens and Hunter Blair, Economic Policy Institute, Washington 2016
Endnotes for this article can be seen at the Footnotes 4 page on this website (link will open in a new page).