Re: Tobin tax - for safe water

[Chris Burford <cburford@xxxxxxxxxx>]

At 19/08/01 11:19 -0700, Ian wrote:
> < http://www.euobserver.com >
> 10.000 protestors to gather in Liege
>
>
>
> The Association for the Taxation of financial Transactions for the Aid
> of Citizens (ATTAC) has been campaigning for the Belgian presidency to
> take up the controversial debate on the introduction of a
> "Tobin-style" tax.

Excellent piece.

Of course they are battling against all the odds, like those people who
thought that blacks should have the vote in apartheid South Africa.

This campaign seems to have the right mix of mass support for protests,
serious theoretical backing, serious policy analysis of where to probe the
weak spots in the establishment, and the ability to highlight a popular
issue - I have added their point about safe water supplies to the thread
title.

Otherwise the best of leftists seem to get bogged down in a muddle of
doubts and hesitations, a) its reformist b) its impossible c) it is
probably not marxist, d) it's irrelevant because capitalism is going to
collapse within 18 months.


Good too that they are addressing some objections:

> If the tax is introduced, isn't there a danger of capital leaving the
> eurozone?

I think their answers are satisfactory. Investment decisions in bulk appear
to be done in a systematic way on a medium to long term basis. The
fluctuations in the exchange rate of dollar and euro are significantly more
than the level of tax they are discussing.

What they do not say here however, is another purpose of the tax is to slow
down the speed of switching of short term funds, totalling over a trillion
dollars a day. In this respect a Tobin tax would be like a traffic calming
measure on the streets, plus a revenue raiser. It might even save
international finance capital  money if they did not have to pay so many
bureaucrats to gamble so much on marginal fluctuations in exchange rates.

> Is it still feasible to introduce the Tobin tax if countries such as,
> for example, the United States refuse to implement it?
>
> We think that the tax at a European level is a good one. You know that
> there is no world-wide tax now. It seems strange that we are demanding
> an international tax, because right now one doesn't exist. We have a
> project to create a Tobin-zone with the European Union and other
> countries - for example, Brazil, India, and so forth - that also want
> this tax. We would create a Tobin-zone with a tax of 0.1 per cent, for
> instance, and then for countries not members of this zone we would
> implement a higher tax of 1 per cent. Then other countries will find
> an interest in joining the Tobin-zone because the tax will be the
> world over.

Very clever.

The idea of going into alliance with other major countries, the euro has
shown is probably technically feasible now.

These contributors refer to Brazil and India. China made particularly
sympathetic noises towards the euro at the time of its foundation. We
cannot predict exactly how, but something along these lines looks
technically and politically possible. It also deals flexibly with the task
of stabilising exchange rates without being absolutely rigid, a key formula
for getting greater control over economic processes.

The idea of a global alliance of countries (other than the USA) starts to
apply in the economic sphere the Spinozist principles for international
politics:

> The only method of avoiding war, whether between individuals or nations,
> is to gather a group of individuals or of nations which will in fact
> possess sufficient force to deter any potential aggressor


Substitute economic chaos for war, and the argument applies. Europe will
not be able to wrest financially hegemony from the USA on its own, but it
has the political issues and methodology, to find ways to set up
international structures that will challenge US financial hegemony. A
revenue source from international taxation, would be a vital step towards
that goal, as Jessie Helms knows.

Subsccribers might like a reminder of this website of one of the economic
organisations behind the Tobin Network USA


http://www.attac.org/fra/asso/doc/doc18en.htm

This economic call has 368 signatories.

Chris Burford

London