The Ultimate Contest for Planet Earth

Yesterday, December 10, 2007 Gordon Brown, Prime Minister of the United Kingdom, issued a call for Google, Goldman Sachs and Wal-mart and other corporations to get the UN commitment to the poor “back on track.” As the UK Guardian put it “Gordon Brown plans to harness at least 20 of the world's biggest multinational companies, including Google and Vodafone, to tackle a "development emergency" in the world's poorest countries and put the international community back on course to achieve seven UN development goals by 2015.” Short of global warming this request betrays one of the most ominous threats the world faces, namely the implied dependence of government on corporations to finance what governments can no longer do. This is privatization on a planetary scale. It acknowledges that corporations have corralled the wealth of the planet. In an earlier blog I mentioned another instance of this phenomenon in which Al Gore has joined a venture capitalist firm to fund profit making solutions to global warming instead of, for instance, working with the UN to create the coordinated governance this problem requires. What Gore is saying by such action is that this dire planetary situation is not going to be dealt with unless a profit is to be made and the corporations will determine how much they will do and how much it will cost. Democracy cannot flourish in such an environment of the rich and the dependent poor.

There is a way, however, to begin dealing with the problem of the world’s poor through the instrument of democratic government. It is called the Tobin Tax.

Instead of relying on the largesse of the corporations, we do what governments have always done; impose a tax to obtain the necessary revenue. But, it may be asked, how are you going to tax multinational corporations that simply move to another country to obtain lower taxes? First it is necessary to identify a global tax base. That is a global activity that will generate the necessary revenue to begin transferring the needed funds to the world’s poor. The Tobin tax would tax all global trades in currency between 0.1% and 2.5%. The daily volume of these global money transactions is between 1.2 and 2 trillion dollars a day. This tax would also discourage short-term speculation, a manifest source of recession and depression. Billions of dollars in currency trades cross the globe daily 24/7.

Now Gordon Brown is aware of the Tobin Tax. It has been introduced in various forms for consideration by various European Union countries. It has been introduced in the past into the United States Congress. Billionaire George Soros even supports a form of it even though, as he says, it would hurt his money trading profits. A successful resolution to support the Tobin Tax if other nations do was passed by Congress in 2000. It had, among its supporters, Dennis Kucinich. The resolution is languishing because it was contingent upon other nations adopting the tax. Why then did Brown call for the corporations to practice charity by providing funds for the relief of poverty in Africa instead of pursuing the Tobin Tax along with other wealthy countries? Perhaps you recall the first President Bush pushing his “thousand points of light” volunteer charity approach to solving the problems of the poor in this country. Charity, as a social remedy, must be rejected. It tacitly denies the right of every individual to the resources of our planet. We need to create a world where people have a right to a decent standard of living. This is what FDR stipulated in his four freedoms speech, one of which was the freedom from want.

For those of you interested in understanding the Tobin Tax there is an excellent article in Wikipedia with links to other sites. We must make people see that we are engaged in a fight with the corporations to preserve democracy for the people. Great wealth and great poverty are enemies of democracy as is unregulated capitalism.

Bob Newhard