Despite the Camp David G8 summit’s support for a shift from austerity to growth, there is no agreement among major western leaders on what growth requires.
Here is an idea whose time has come: a Financial Transactions Tax.
The tax would do two things urgently required by the crisis. It would take some of the profit out of the pure speculation that has created such hardship for countries like Greece, Portugal, Spain, and Ireland whose economies have already been pummeled by recession and by perverse demands for belt tightening.
And a tax on financial trades could raise some serious revenue, which could be put back into green investment and other forms of economic stimulus to help the economies of Europe revive.
This week is crucial for the fate of the FTT. Europe’s leaders are gathering for an emergency growth summit in Brussels. And the European Parliament will be debating a report from its Economic and Monetary Affairs committee, which has recommended enactment of such a tax.
The obstacles: the conservative British government of David Cameron opposes the idea, both in principle and because it believes that any such revenues levied on British finance should go to London, not Brussels. And President Barack Obama has thrown cold water on the idea. It would be hard for continental Europe, the smallest of the three money centers, to make an FTT stick without support from New York and London.
But what ideology has resisted, a crisis may yet achieve. This week, a large coalition of citizen groups, trade unions, and progressive parties will be putting on the most intensive press yet, in a coordinated Robin Hood Tax Global Week of Action, for a tax to take the profit out of the toxic business model that crashed our economies. This effort deserves our support.