Bono and Global Tax Justice

5 Dec

I recently published a piece in The Guardian on the Paradise Papers tax revelations concerning Bono. This led to three interviews on this topic: one in the Swiss newspaper “Tages-Anzeiger” (here), one with the Greek newspaper “Εfimerida ton Syntakton” (here), and one that was used as research for an open letter to Bono in the German “Die Zeit” (here). I have always been careful not to make this all about demonising Bono, and so was a bit disappointed with the letter in Die Zeit. The initial headline for the Swiss article quoted me as saying “I don’t know if Bono will go to Hell” (I was just trying to make the point that it’s not about whether Bono’s a good or bad person), but I emailed them about this and they very kindly changed it.

I still have this huge balloon (9ft wide, 24ft high) resting in my father in law’s garage…I should probably put it on e-bay…

U2

Closing Loopholes Will Change Little

28 Nov

With the publication of the Paradise Papers the public has once again been shocked by the extent of tax cheating by the wealthy elite. But precious little of the coverage has focused on what needs to be done stop it happening. Where there is such discussion, it has almost exclusively focused on closing loopholes. Whilst this is important, in the context of the billions siphoned off to tax havens every year, it amounts to rearranging the deckchairs on the Titanic. The problem is that the system is broken.

I’m not talking about capitalism itself, but rather the system of international tax law that was created by the League of Nations in the 1920s. The system operates by the Arms-Length Principle, according to which sister companies of transnational corporations are supposed to behave as though they were separate entities, for example, by trading goods at market prices. The problem is that the world of the 1920s is very different from the world of the 2010s. Technological connectivity and globalised finance has rendered the Arms-Length Principle impossible to police and profit shifting is rampant. By paying extravagant fees for use of trademarks, or by paying interest on huge loans, a company in one location – say, Britain – is able to move profits to its sister company in a low-tax jurisdiction – say, Ireland. In reality, these “two” companies are not distinct entities but our tax laws allow them to behave as though they were. The result is that profits generated in Britain are booked for taxation in Ireland, or shifted on to another tax haven. Economists at the University of California, Berkeley, have estimated that six European tax havens alone (Luxembourg, Ireland, the Netherlands, Belgium, Malta and Cyprus) shift €350bn of profits every year.

In broad outline, the solution to this problem has been known to both political scientists and policy makers for some time, but in the absence of pressure from the public progress is slow. The first priority is greater transparency: profit shifting thrives in a climate of secrecy. More specifically we need Automatic Exchange of Information – whereby countries are legally obliged to share all of their tax information with each other – and Country-by-Country reporting – whereby a transnational corporation is obliged to give a single figure for their worldwide profits and a breakdown of how much was generated in each country of operation. With such increased transparency, the public would be able to see the system for what it is, and demands for change will grow.

The ultimate goal is to move to a system of Unitary Taxation, which would ensure that transnational corporations are taxed in each jurisdiction in which they operate according to the real economic activity they conduct in that area. This would end once and for all the farce of companies such as Starbucks and Amazon being able to pay miniscule levels of corporation tax that bear no relation to their sales or employment figures. This is not Utopian. Such a system is used within federal countries such as Canada, Switzerland and the United States. And the EU has worked out a proposal for a Common Consolidated Corporate Tax Base, which would go a long way towards a system of Unitary Taxation within the EU. So far implementation has been blocked not only by the countries most guilty of systematic profit shifting, but also by the neo-liberal government of the UK.

With the political will, profit shifting could be resigned to history. Labour should rise to the challenge and pledge that in government they will lead negotiations towards a new system of global tax law fit for the realities of the 21st century. It’s time to make globalisation work for everyone.

Never Happier to be Proven Wrong

23 Oct

Most people I speak to either love Jeremy Corbyn for his politics or hate Jeremy Corbyn for his politics. I previously found myself in the rarer group of being strongly in favour of his policies, whilst having severe reservations about his political skills and his ability to cut through to the public. Before the campaign of the recent UK election when Labour was languishing in the polls I despaired of Labour ever gaining ground.

How much can change in a short space of time. I was overjoyed when the election campaign transformed Labour’s fortunes, proving wrong my pessimistic predictions. Labour didn’t win, but with 40% of the vote nobody can now say that the party is ‘unelectable’ with Corbyn as leader. And with May adopting Labour policies previously denounced as communist by the Tories, such as an energy price cap, the political centre of gravity has certainly shifted leftwards.

Whilst I doubted Corbyn’s ability to pull it off, I certainly never doubted the importance of a more radical economic agenda. Globalisation is no longer working for ordinary people in UK. The Thatcherism of the 1980s was savage on working class communities and massively increased inequality, but it co-existed with increasing wealth for a fairly large proportion of the electorate. But since the crash of 2008 the vast majority have suffered the worst squeeze on living standards since the 1750s. In contrast the wealthiest have seen their net worth double. We now live in an economy shaped by and for the interests of the top 1%.

People in Europe and the US are seeking radical alternatives, from both right (Trump, Le Pen, PIS in Poland) and left (Podemos, Sanders, Corbyn). If the left can’t persuade the public that a radical reshaping of the economic model is the solution to their woes, I fear that we’re going to find more fascists in parliaments.

Do Electrons Dream of Electric Sheep?

19 Oct

I’ve written quite a few articles recently outlining my ‘simplicity argument’ for panpsychism. One persistent questions is, ‘Why on earth should we suppose matter has an intrinsic nature????’. In this article for LSE’s ‘The Forum’ I try to layout the article in a bit more detail. It’s an old and much discussed argument. I think my slight addition to it is the response to holism.

Poem: Living With a Panpsychist

28 Sep

Seeing as it’s National Poetry Day in UK, I thought I’d re-post the poem I commissioned for the issue of Philosophy Now magazine I guest edited on ‘Radical Theories of Consciousness.’ Big fan of Machter’s work…I may put up some more of his stuff…

Living With A Panpsychist

by Thomas Machter

“Simpler to suppose: all has thought.
Safer to say: in a never
fresh universe, nihil novum.
Subtler to see: that to itself
mind reveals the very nature
of the nature in which it sits.

Am I pissing up the wrong tree?”
Evenings are long, distractions are
great; so what if fine error breeds.
What is it to me if my love
miss-takes the universe and time,
to build an implausible frame?
Reason has led her there, I guess.
But atoms with experience?
“My love! Why go on with this? No,
you’re not barking up the wrong tree;
you’re entangled in its highest
branches, howling wild at the moon!”

I soon regretted this sarcasm,
relented, and apologised.
Chastened, I spread myself far out.
What must it be like to believe
some cranky wayward subtle scheme?
I sunk myself into a broad
range, a general passion, a wide
scope. What thought can not be worked through?
Mind’s a match for the universe.
I contain every conviction.

Is Taxation Theft? (and why the answer matters..)

22 Sep

I have written a lot of short pieces addressing this question (the answer is always no). But this piece for Aeon magazine is the most extensive thing I’ve written so far, and goes into much more detail about the nature of ownership. I’m always amazed at how much this stuff angers people. I’ve been enjoying battling with with terrible arguments on the comment thread (which you have to register for) and the Aeon FB pages…I invite you to join the fun!

I think this is a place where abstract, academic philosophy can really make a practical difference. The way almost everyone (voters and policy makers) think about taxation is demonstrably confused. And (as I say in the article) this matters: this confused sense that my gross income is “my money” is a major stumbling block to economic reform, causes low and middle earners to vote against their economic interests, and renders it practically impossible to correct the economic injustices that pervade the modern world.

Back to writing useless stuff on consciousness…

Grand Finale of Consciousness Debate

11 Sep

Hot off the press:  Final episode of my debate with Professor Papineau (KCL), in which he concedes that I was right on all points of contention and promises not to disagree with me again.