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Friday, January 28, 2005

Tranzi Rubbish

My least favourite European Politician has once again be spouting crap at an international event.
President of France Jacques Chirac said that the participation of the corporate sector was "crucial" in order to battle poverty. He proposed a voluntary tax as part of a call for more financial resources to be allocated to common challenges and singled out the battle against AIDS.
Voluntary Tax is he off his mind. A man who represents the rape and pillage form of government taxation has the gall to ask us to volunteer more money. His complete speech can be found here. Major stupidities include:
The turnover of the world's leading one hundred companies was over seven trillion dollars in 2004. The sum of the turnovers of the top two companies is greater than the GNP of the entire African continent.
We expect this level of ignorance from the Guardian, but this man surely must have economic advisers (Sorry looking at France he probably doesn’t). Turnover and GDP are not in any way comparable. GDP is analogous to profit.
Left to their own devices, economic forces are blind and contribute to the marginalisation of the weakest.
On the other hand, left to their own devices, State organisations purposely destroy the few opportunities that the weak have to better themselves. State corruption, restraints of trade, education systems geared to propaganda and tribalism all take a massive toll on poor citizens the world over.
The divide between rich and poor has widened to a frightening degree! The difference in income per capita between the least developed countries and the OECD countries, which was a ratio of one to thirty in 1980, now represents a ratio of one to eighty!
Unless all countries get themselves good government, the only way that inequality will not rise is if there is no growth. Those at the bottom are just not moving. The proportion of the world living in absolute poverty gets smaller every year.
So many countries are landlocked, repeatedly suffer from natural disasters, with their populations prey to pandemics, malnutrition, illiteracy and the tyranny of subsistence needs. How can they imagine anything other than a survival economy?
Much like the Europe of the middle ages. It does not follow that large sums of money is what is needed to solve the problems. Besides economic illiteracy at least has proved no handicap to many of our most successful politicians.
With a long-lasting effort of two billion dollars per year, we can finance research into a vaccine against malaria.
If it costs 2 Billion dollars to develop a drug, I suggest you all sell you pharmaceutical shares.
Let us look into the option of a contribution from international financial transactions. This would not be a Tobin tax. The international solidarity levy would be designed so as not to be an obstacle to normal market operation.
I know this is difficult for a mere Frenchman to understand, but taxation is the problem not the solution. All taxes are an obstacle to normal economic transactions. How can the French regard someone who uses the term solidarity to be a conservative?
There is a second possibility. Why not ask countries that maintain bank secrecy, which they consider to be part of individual freedom, to partially compensate for the consequences of world tax evasion, which is so damaging to the poorest countries.
Its also damaging to France’s Communist ideals, but our Jacques is careful not to mention that. The main reasons that businessman in the developing world don’t pay taxes are, they get nothing in return, staying anonymous saves you from bribe extortion and they make so little money that they have nothing to share with corrupt and greedy state employees.
Third avenue. Let us look at the hypothesis of a contribution levied on the fuel used by air or sea transport. This would simply represent the end of an exemption regime
We tax everything else so it hurts us not to be able to tax these fuels. I recently took a trip which included a change of planes. The ticket price was $99 before tax. I actually paid $276 including all the airport taxes. Don’t let them tell you that air travel is tax free.
This voluntary approach is not necessarily limited to individual donors, but could also apply to the big global economic players. For large corporations and private financial organisations, it would be a magnificent undertaking to set up, under their aegis, large international foundations dedicated to the fight against poverty, in the same vein as the Bill and Melinda Gates Foundation.
The Bill and Melinda Gates Foundation is a very admirable idea, undertaken by a very clever and very rich man. It is also his own money. However good the cause, company contributions to charity are an appropriation of shareholders funds. They therefore represent theft.
We want the peoples and the youth of the world to see a project for hope and progress in the globalised economy. For this to be the case, we must simultaneously set up, on a planetary scale, new forms of political governance and rules for the global market
Why do they refuse to understand? The free market works because it is Uh-Uh-Uh that’s right, FREE. Global governance? Would that mean sharing decision making with Fidel and Turkmenbasi?
In the developed countries, the setting up of social protection and risk-sharing mechanisms has significantly contributed to economic development. We must help developing countries to set up minimum safety nets.
No absolutely not. Social protection has destroyed the fabric of society and dulled the incentives for success. It is a luxury that only rich countries can afford. To save Mr Chirac time, I have prepared a short speech for the next time there is such an international gathering. It offers real solutions to the problems of the world: Ladies and Gentlemen. We in the EU have decided to abolish the common agricultural policy, to reduce tariffs on all products without exception to 0% and to discontinue any antidumping actions. We promise to stop subsidizing any companies of any kind ever. We call on all other countries to follow our lead. Long live Frederic Bastiat, long live Capitalism. PS Check out the WEF Blog Update, The Guardian of course loves the idea.

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