The Robin Hood Tax organization’s efforts to turn “a Global Crisis into a Global Opportunity” are ethically complex. Activists in the United Kingdom note that a “tiny tax on the financial sector can generate £20 billion annually,” and seek to raise and use that amount to combat poverty and climate change. They say it’s “not complicated. Just brilliant,” but few issues of political economy are really that simple. I too hate to see bankers receiving bonuses from taxpayer money while many people are suffering in these hard times, but we need substantial change to the institutions, not merely a tax on those who benefit from the current economic order.
Conservatives and libertarians tend to react against the classic imagery of Robin Hood’s stealing from the rich to give to the poor, claiming that they worked hard to become rich and deserve to keep it, based upon their own productivity.
Progressives and socialists oppose this ethos on the grounds that if we let people keep what they create without limits we will have outcomes like we have now, where the cruel free market has allowed unjust distributions of wealth to occur.
Beautifully, as is often the case, both groups of people are as right as they are wrong.
The wealthiest in society aren’t there purely through productivity and hard work, but at least to some extent through state power. If it were as simple as Randian-described looters coming to exploit the rich I could call myself a conservative, defend them, and be done with it.
If the economy we had were natural and not the product of massive state intervention for the benefit of the elite, I could become a party line progressive and move on with my life.
Unfortunately, without nuance this conversation about taxes and economic inequality is incredibly divisive rather than a great unifier between all people who care independently about fairness or free markets.
On the “Not Convinced?” page, they have a quote posted from Nobel Prize-winning economist Joseph Stiglitz who said “we need to stop socializing loss and privatizing gain.” He’s absolutely right, but this has nothing to do with instituting a tax to try and balance a statist system which has made such corporate insanity economically feasible.
At the most basic level, intellectual property protections, tariffs, land policies not based on use but upon state title, licensing requirements, zoning policies, legal tender laws, subsidies, competing good prohibitions, and countless more state interventions into the free economy help solidify economic power into the hands of the few at the expense of the many. To call anyone who supports a system like this a “free market fundamentalist,” as Stigletz does, is intellectually dishonest.
In the competitive marketplace profit, rent and usury are driven to the lowest cost currently possible. In a cartelized marketplace one should expect to see the corruption that comes from unaccountability to consumers, and haven’t we?
It is understandable why some people would choose to focus on raising taxes rather than confronting the myriad of anti-freedom policies which have led us to this terrible place. It is less complicated and easier to sell taxes to the relevant constituency in our climate of political soundbyte baiting than to sell one thousand separate battles against state intervention which helps the well-entrenched interests maintain their hold on the economy. It is simply too much work to muster a coordinated fight against these policies.
However, the long-term goal of fixing the unnatural distribution of wealth in the world isn’t to keep anti-market privileges, still call it a “market economy,” and then try to siphon the riches off those who benefit from state intervention and then place it into the hands of the impoverished, or funnel it toward pet political issues.
Britons and all people should confront this problem head-on and remove the privileges which benefit established firms and allow them to act incredibly irresponsibly. Ideally, the Robin Hood Tax people would like “new taxes on the financial sector [which] would be implemented globally,” but if they don’t remove the foundation of state intervention which allowed for a highly centralized, volatile, and abusive economy, this will at best be yet another marginal solution to a world unwilling to face the statism at the root of our troubles.