\t\t\t\tIt is Wednesday, so only a few snippets only today, while I am working on six lectures I have to give in Helsinki over the next two weeks. The first of those lectures will be a public event. And looking at the weather I am about to undergo around a 45 degree Celsius turnaround from where I am today in Australia to where I will be next week! That is what happens when you go to Finland in the early part of the year. Anyway, here are some items of interest I hope.
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In case you haven’t seen it, Thomas Fazi and myself have an article out last week (February 16, 2018) in the Green European Journal entitled – Tax havens must be closed, but not for the reasons you think<\/a><\/p>\n The article summarises arguments I have made in various blogs (see below) – which can be distilled into these summary insights:<\/p>\n 1. Currency-issuing governments are not like households, who are financially constrained and have to ‘fund’ their spending via income, borrowing, prior savings or asset sales.<\/p>\n 2. The progressive reaction to the release of the Paradise Papers told us that most progressives still do not understand Point 1. They think the government needs to raise taxes to reduce its reliance on debt while providing public services via expenditure.<\/p>\n 3. “A consequence of the fiat system is that governments that issue their own currencies no longer have to ‘fund’ their spending.”<\/p>\n 4. “currency-issuing governments such as those of Australia, Britain, Japan and the US can never ‘run out of money’ or become insolvent.”<\/p>\n 5. “Do we need the rich’s money?” No.<\/p>\n 6. “So should we close down tax havens? Yes!”<\/p>\n Why? The reasons “largely have to do with social justice, inequality and the distribution of political power”. <\/p>\n For more information, please read the article (if you are interested). <\/p>\n The point generalises. Last Friday, I gave a talk at the New International Bookshop in Melbourne about our new book – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World<\/a> (Pluto Books, 2017).<\/p>\n There was a good audience and during the question time the issue of ‘taxing the rich’ came up. A very oft-repeated ‘progressive’ narrative.<\/p>\n The response I gave was that just as Ayn Rand claimed in Atlas Shrugged that the workers were parasites and relied on the productive skill and zeal of the bosses, the ‘tax the rich’ narrative perpetuates the view that without the rich folks in our society we can have nothing worthwhile.<\/p>\n Which is plainly false.<\/p>\n I said that there are good reasons for decreasing the spending capacity of the rich (via taxes etc) but none of those reasons relate to whether the government has the financial capacity to provide first-class public services to the poor (or the rest of us).<\/p>\n Modern Monetary Theory (MMT) tells us that a currency-issuing government can provide these services if it has the political will.<\/p>\n If the economy is at full capacity then such a government has to divert resources from other uses into a specific service that it wishes to expand.<\/p>\n It would do that via taxation. But the taxation is freeing up real resources to be used in the desired way by depriving the non-government sector of their use.<\/p>\n It is not giving the government extra ‘money’ which enables it to spend.<\/p>\n More generally, ‘taxing the rich’ is supported by a progressive agenda because it reduces the ‘power’ of the rich to exploit the political process for their own purposes.<\/p>\n I have written about this issue previously (among other blog posts on the topic):<\/p>\n 1. What matters about the Paradise Papers<\/a> (November 13, 2017)<\/p>\n 2. Solving tax avoidance will not cure the Eurozone of stagnation<\/a> (December 15, 2014).<\/p>\n 3. Off-shore tax havens – be sure we define the issues correctly<\/a> (July 23, 2012)<\/p>\n I was reminded by a reader (thanks N.) of this great album – Pieces of Man<\/a> – which was released in 1971. I haven’t listened to it for a long time.<\/p>\n It was the second album from the late poet, musician and author – Gilbert Scott-Heron<\/a> – who was active in the 1970s and 1980s.<\/p>\n He brought soulful music together with social and political commentary – a powerful mix. He called himself a “bluesologist”.<\/p>\n He had troubles in his life but the music he left is of exceptional value.<\/p>\n Here is an interesting obituary (May 28, 2011) in the New York Times – Gil Scott-Heron, Voice of Black Protest Culture, Dies at 62<\/a>.<\/p>\n This track featured the great Jazz double bass player Ron Carter<\/a> and pianist Brian Jackson<\/a>, who cowrote the song about the problems of unemployment.<\/p>\nThis is what I am listening to at present while I work …<\/h2>\n