Nobel Prize-winning economist Joseph E. Stiglitz, perhaps the most prominent economic thinker in the Democratic Party, is blowing the horn for global taxes. A chairman of the Council of Economic Advisers in the Bill Clinton Administration, Stiglitz has been described as a "real Democrat" and possible candidate to head the Federal Reserve [1] in a Democratic Administration.
His first book, Globalization and its Discontents, was praised by George Soros as "Penetrating, insightful.... A seminal work that must be read." [2] In it, Stiglitz suggested that while a global tax on currency transactions, the so-called Tobin Tax, was being seriously studied in Europe, it might involve serious "implementation problems." But with his subsequent book, Making Globalization Work, those problems have vanished, as he argues for a variety of global tax schemes [3] that would cost American taxpayers billions of dollars.
Stiglitz, who anticipates possibly serving in a Hillary Clinton Administration, [4] predicts a Democratic victory in the November 7, 2006,
Elections [5] and major changes in the global economy. Most of these involve soaking American taxpayers. He and Soros [6] are among those proposing the creation of new currencies to finance more foreign aid spending.
For his part, Stiglitz wants to generate hundreds of billions of dollars in what he calls "global greenbacks." This is a new form of "global money," he says, constituting one of several "innovative approaches to financing economic development [which] need to be tested." [7]
The phrase "innovative approaches" or "innovative sources" is code language for global taxation schemes.
"Who would receive the annual emissions of global greenbacks?" he asks. He suggests various approaches:
"Taxation on global negative externalities, such as arms sales to developing countries, pollution, and destabilizing cross-border financial flows, can provide a third source of revenue for financing global public goods." [9] The term "global public goods" is part of a U.N. effort to claim there are certain matters beyond the ability of any one state to address and that the international community, including the U.N., must get involved in solving them. [10] As Stiglitz puts it:
"Globalization entails the closer integration of the countries of the world; this closer integration entails more interdependence, and this greater interdependence requires more collective action. Global public goods, the benefits of which accrue to all within the global community become more important. These include, for instance, health (funding a vaccine against malaria or AIDS, and the environment (reducing greenhouse gas emissions, maintaining biodiversity in rainforests). These should be first priorities for the funds." [11] All of these ideas, which have been extremely popular at the United Nations, involve global taxes of some kind. Exploiting AIDS patients in order to generate global tax revenue is the most popular current idea.
While he embraces global taxation as one important source of revenue, Stiglitz identifies two other sources of international revenue as resulting from reform of the global monetary system and the "management of global resources."
In the first instance, he says that the global monetary system of the world should be reformed in order to produce funds to "promote development, fight poverty, and provide better education and health for all," he says. [12] He says that global currency reserves, U.S. dollars held by various nations, especially China, should be transformed into "a new international currency" that can solve global problems. In the second instance, that of "management of global resources," Stiglitz argues that revenue can be generated "for providing global public goods" through "auctioning off fishing rights, or the right to extract natural resources beneath the sea, or carbon emissions permits…" [13]
At the "Second Annual Global Colloquium of University Presidents" earlier this year, with United Nations Secretary-General Kofi Annan in attendance, Stiglitz gave a talk entitled, "Innovative Sources of Funding for Global Public Goods," [14] in which he presented these ideas in some detail.
While Annan was a big backer of global tax schemes, so is the new Secretary-General, Ban Ki-moon, the Minister of Foreign affairs and Trade of the Republic of Korea, whose government "had put forward a draft bill for the creation of an air ticket solidarity contribution…" This is the international tax on airline travel now being implemented, some of whose proceeds are being provided to UNITAID, an international agency designed to purchase and distribute anti-AIDS drugs. Ban "said his country was pleased to be part of the pilot group launching UNITAID." [15]
There has been much speculation that South Korea’s support for global taxes and more foreign aid spending was a key factor in Ban Ki-moon’s selection as U.N. chief.
A story in the South Korean press reported:
After Minister of Foreign Affairs and Trade Ban Ki-moon announced his run for the U.N. secretary-general’s position, it was pointed out that Korea should raise its development spending to improve its voice in the global community. [Finance and Economy Minister] Kwon also said Korea plans to introduce the Solidarity Contribution on Airplane Tickets and muster its strength to help eradicate poverty and disease in the world. Beginning next year, the government plans to impose a 1,000 won tax on the purchase of every ticket for international flights to help poor countries. [16]
UNITAID is being set up by the International Drug Purchase Fund. To date, it says, 14 countries have expressed their intention to implement the same type of levy: Brazil, Chile, Cyprus, Congo, Gabon, Ivory Coast, France, Jordan, Luxembourg, Madagascar, Mauritius, Nicaragua, Norway and the United Kingdom.
The same press release announcing Ban Ki-moon’s support of the global tax also noted that:
"William Jefferson Clinton, former President of the United States, said the Clinton Foundation was honored to be involved in this project and thanked France, in particular, for that country’s role in spearheading the initiative." [17]
Clinton’s personal representative on the UNITAID project is Ira Magaziner, who served as then-first Lady Hillary Clinton’s project manager for socialized medicine.
Nancy Birdsall, president of the Center for Global Development, was initially ecstatic about the international airline tax, saying on her blog that it was "Time for the U.S. to Sign on." [18] She later backed away from this suggestion, saying that the funds would not go to the Global Fund to Fight AIDS but to a different entity that might not be accountable to U.S. taxpayers. [19]
Yet, Paul Wolfowitz, president of the World Bank, has praised the French-led international drug purchasing fund and has suggested the Bank would cooperate with it. [20]
Despite not yet being designated as a recipient of international tax revenue, the Global Fund to Fight AIDS has welcomed the creation of UNITAID, saying it is an "innovative approach" that promises the" necessary sustainability of financing." [21] Created in 2002 at the urging of Secretary-General Kofi Annan, the Global Fund already gets hundreds of millions of dollars from U.S. taxpayers.
Embroiled in scandal and controversy, the organization considered hiring retiring Republican Rep. Jim Kolbe as its new executive director. However, Kolbe, who is openly homosexual, became the subject of reports that, like disgraced Rep. Mark Foley, he had maintained inappropriate relationships or contacts, possibly of a sexual nature, with male former congressional pages. The House Ethics Committee opened an investigation into this.
In a related problem involving conflict of interest, Associated Press reported [22] that Kolbe was up for the job leading the Global Fund even though he had helped determine its funding as chairman of a House Appropriations subcommittee. AP said, "The committee's bill, approved May 25, included $3.4 billion in global assistance to combat AIDS, tuberculosis and malaria, including $445 million for the U.S. contribution to the Global Fund." This figure, advocated by Kolbe, was over twice the amount requested by the Bush Administration.
Conservative groups had objected. Amanda Banks, federal issues analyst for Focus on the Family Action, said the Global Fund was an "unaccountable" organization, explaining, "It's not a U.S. program, it's an international fund and we have very, very little control over how it allocates money." [23]
She told citizenlink.com that "They are quite closed regarding how they spend the money. But we know that, in part, they support needle-exchange programs, the legalization of prostitution, abortion, as well as liberal organizations associated with billionaire George Soros."
Soros also happens to figure in the financial underwriting of the non-governmental organization (NGO) that Stiglitz has created to carry his ideas forward. It’s called the Initiative for Policy Dialogue, based at Columbia University. His funders [24] include:
At an event in September at Columbia University, Stiglitz appeared on a panel with Soros to discuss globalization. "People who write books generally don't have time to read them. I actually read this book [Making Globalization Work] ... and I'm glad I did," Soros said. [25] The panel moderator, Tina Rosenberg of the New York Times, declared:
"Professor Stiglitz is on a revolutionary track. But there so far is no revolution, and that part is up to you." [26] (emphasis added).
[3] In the paper, The Economic Case for a Tobin Tax, Thomas Palley of the Soros-funded Open Society Institute listed Stiglitz as a supporter of the tax. [4] Edmund Conway in the London Telegraph reports: "… Joseph Stiglitz, Nobel laureate and former economic adviser to Bill Clinton, says he wouldn't hesitate if Hillary called up and asked him to do the same job for her." See http://www.telegraph.co.uk/core/Content/displayPrintable.jhtml?xml=/money/2006/08/28/ccprof28.xml&site=1&page=0 [5] http://www.sundayherald.com/57656 [6] Soros has proposed what he calls an annual issue of Special Drawing Rights (SDR) that rich countries would donate for international assistance. [7] http://www.globalpolicy.org/socecon/ffd/2002/0322greenback.htm [8] Joseph E. Stiglitz, Making Globalization Work, (2006, New York: W.W. Norton & Company), pages 266-267. [9] Ibid. page 281 [11] Ibid. Making Globalization Work, page 266. [12] Ibid. page 146. [13] Ibid., page 281. [26] Ibid. | |||||
