|
Is it
possible that there may be no flashpoint this time? Is it possible that the
security of the super-greedy and their perceived legitimacy have been so
well-constructed and embedded in the social consciousness that their
depredations will simply remain invisible, and their bases of power and place
hidden.
Without cheers,
Lawry
Maybe, Ed, you are part of the problem.
That may be so. Part of me, the
cussed part, tells me that I shoud let things deteriorate to some
flashpoint. Another part, the compassionate, says yeah but what about
the poor mothers and the older guys from the Ottawa Valley? And yet
another part, the guilty, gnaws at me because I'm retired and have a decent
income. God life is hell when you're comfortable!
Ed Weick
----- Original Message -----
Sent: Thursday, May 29, 2003 3:53
PM
Subject: RE: [Futurework] Exit ramp for
Europe
Maybe, Ed, you are part of the problem.
I'm a masochist. I'll never leave the food bank.
Ed Weick
----- Original Message -----
Sent: Thursday, May 29, 2003 3:09
PM
Subject: RE: [Futurework] Exit ramp
for Europe
Have it your way Ray. But when the gas tax was first
proposed it was fought by vested interests (autos and highway
lobbies). The feds wanted to introduce it first but backed down
under pressure. It was first introduced, I believe, by
Oregon and later by the federal government.
An indirect tax, a stealth tax on network activities if you
will, can go a long way to monetize much of the productivity that
is currently taking place but is not counted anywhere in our system of
national accounts. So we feel poorer than we actually are.
If we could monetize some of this productivity, tax it in the form of a
bit tax and use it to help provide a Basic Income, then Ed Weick can
leave his thankless tasks at the food bank (some pun on "bank") and can
produce his delightful essays for his web site.
arthur
No, the people who would pay the bit-tax
are the people who now only have the internet for their lives because
the rest of the world is too expensive. It is the poor who
always pay the taxes, whether in rising prices or in sales
tax. Anything else is just sleazy.
When will you reconsider the meaning of the word "productivity" in
terms of mega thinking rather than minimalism. Do
you always want to listen to the same wallpaper music all of your
life? That is why Philip Glass and Steve Reich are
so correct and that is also why most people either "get it" and listen
for personal understanding or can't stand the fact that it shows how
transperent their pants are. In short, you either
listen and say, "That's right" or you say they are just too dumb to
stand and they say, "You got it and I got it from
you!"
REH
----- Original Message -----
Sent: Thursday, May 29, 2003
8:57 AM
Subject: RE: [Futurework] Exit
ramp for Europe
This is why we need a tax system which is congruent with and
takes advantage of a networked economy. I have argued for such
a system with the "bit tax" There are other approaches but the
bit tax would be a good first step at getting at the productivity of
networks for the public purse.
As to tax havens, there is slow, very slow move reform these
places. The political will is lacking since, I guess, the rich
who contribute to political parties have given the slow down signal
to politicians. Too bad, since the tax havens know that a
crackdown is in the works. And have known for some time.
Reforms just seem to die in committee.
arthur
A French
think-tank, the Institut Francais des Relations Internationales,
thinks that, for Europe, "A slow but inexorable movement onto
history's exit ramp is foreseeable." At the same time, those who
want a United States of Europe have brought forth a Constitution
which is now being fiercely debated. This is the background for an
excellent article by Hamish McRae, the economics editor of The
Independent. For those interested in Europe or of the likely scope
of government welfare spending generally in the future, the
following article from yesterday's paper will be well worth
reading.
<<<<
EUROPE CAN'T BUCK THE
MARKET
Hamish McCrae
When economics and politics
clash, economics usually wins. Whether or not the proposed
European constitution means that Brussells will have a say over
British taxes -- and there is so much obfuscation that I don't
think it is possible to know at this stage -- economic pressures
seem likely to push down Europe's taxes to UK levels, maybe
beyond. The politics may be for higher taxes but the economics are
for lower ones.How so?
Well, the pressure on governments
across the whole of the continent will be huge for the next two
generations. Government will be under tremendous pressure to spend
more but also will find it harder and harder to raise
revenue.
This is the result of the clash between two
forces, demography and mobility. The first story can be told
quickly. Continental Europe will become, after Japan, the oldest
region in the world in terms of the proportion of people over the
age of 65. The UK becomes older too, but at a rather slower rate.
The effect of this is that, whereas there are currently just under
three workers for every pensioner in Germany and France, in
another decade there will be only two and a quarter. In 2050, when
young people now entering the workforce are drawing their
pensions, there will be fewer than one and a half workers for each
pensioner. In Italy and Spain the ratios are even worse, for there
will be more pensioners than workers by 2050. In the UK they
are rather better: we are, as a country, getting older, but more
slowly than the Continent.
European governments are well
aware of the implications of these changing ratios on their
finances for, not only will the bulging ranks of pensioners need
their state
pensions, they will also be a charge on health and
care budgets. However governments find it hard to make even modest
changes. The present bout of French
strikes is one response to
minor revisions to pension entitlements. If the protesters knew
the extent to which their benefits would have to be cut, they
would be rioting, not striking. The big fights are still to come
-- and if the pressure is serious in France it will be greater
still in Germany, Italy and Spain.
If demography adds to
the cost of government, mobility cuts its revenues. One form of
revenue, company taxation, is already in serious decline, as
corporations have started to move their activities to low-tax
countries. For the winners this has been wonderful. Ireland has
transformed its economy by attracting mainly US companies with tax
holidays. It does not get revenue directly from the firms, but it
does from the people they employ locally.
The next stage
looks like being the movement of company headquarters. There have
been examples of German companies moving to Switzerland and US
ones to Bermuda. But the greatest gainer may well be the States,
with this administration's new plans to cut tax on dividends.You
can see why the European Union is anxious to have a reasonable
measure of company tax harmonisation to stop Ireland scooping more
than its share of Europe's pool of foreign investment. But the big
game is not within Europe; it is between Europe and North America
and it is hard to see much tax harmonisation there. For a firm
such as DaimlerChrysler or GlaxoSmithKline, the legal headquarters
could rationally be on either side of the
Atlantic. If the tax
advantages became big enough, they could move.
Over the
past 10 years there has already been a sharp fall in company tax
rates. This,
I suspect, is a trend that has only just begun.
Company taxes are, however, only a small proportion of government
revenues. Here in Britain the rate is less than 8 per
cent. The
big money comes from income tax (including social security
contributions) and consumption taxes, in particular VAT. So what
matters is where people earn money, and where they spend
it.
For the very rich, the choice of where to live is
already very largely determined by tax. Tax havens including
Monaco and the Channel Islands do a great business. There are
people who live in the Channel Islands but work, in effect, a full
week in
London without, technically, ever being there for tax
purposes.
Much more significant is the mobility of the
young. You can see this best in London,
which has become a
magnet for young professionals from all over Europe and indeed
North America. The South-east of England has the largest
expatriate professional community on the globe. Continued
professional inward migration is one of the reasons why me UN now
expects the population of me UK to grow by 12 per cent over the
next half-century. This compares with a rise of 8 per cent in
France and falls of 4 per cent and 22 per cent in Germany and
Italy.
Tax is not the only reason for professional mobility
but it is a significant one. Young professionals are a hugety
attractive proposition for any country They bring skills, they
create growth, they pay tax both on their income and their
spending -- and they are not big burdens on social security
systems. I suspect that one of the main areas of competition
within Europe will be for just these people and, of course, with
the EU's single job market they are free to move
anywhere.
If that is great for Britain, it is not so much
fun for, say, Italy or Germany. The nigh-eartimg young move out,
leaving an even greater burden on the taxpayers who stay. The only
way to keep them will be to cut taxes. And the more the European
economy becomes like the American one, the greater the mobility of
labour.It follows that if Europe is to become a more dynamic
economic region, the result will be population movements that
force down tax levels everywhere.
You can see early signs
of this already. In Sweden, the highest-taxed country in
the
world, spending has afready fallen from its 1993 peak of 67
per cent of GDP to about 52 per cent. The top marginal tax rate is
down to about 60 per cent (it varies depending on where you live),
me same as Britain in the 1980s.
In a more or less closed
economy, countries are free to choose the size of the state sector
-- if they want to pay higher tax and get better services they are
free to vote for that But in an increasingly open economy this
choice closes off. It is already, in effect, closed for company
taxation. It is starting to dose for personal taxation too.
So whatever the provisions of the European constitution on
tax powers, the reality will be set by the market. Of course it
can try to buck that market. The result could then be rather on
the lines suggested by the Paris think-tank, the Institut Francais
des Relations Internationales. In its recent report World Trade
in the 21st Century, it warned that the EU, even after
enlargement, might shrink by 2050 from its present 22 per cent of
the worid economy to a mere 12 per cent. "A slow but inexorable
movement onto history's exit ramp is foreseeable." It painted
other somewhat more optimistic scenarios -- but it makes a sombre
backdrop to grand ideas about the European
constitution.
>>>>
Keith Hudson,
6 Upper Camden Place, Bath, England
|
