|AUTHOR´S EDITORIAL 13/12/2001|
I consider the “Tobin Tax” an attempt to look for colored birds in a dark tunnel, at night, while wearing sunglasses. In these conditions it is impossible to achieve results because of the lack of light. In the same way, the proposal for establishing a tax on short-term monetary transactions to slow speculation cannot offer positive results if an international regulation does not exist previously, approved by all the nations with the commitment to apply it without exception. Otherwise, the fiscal paradises will be the beneficiaries. I do not know what possibilities there can be for an agreement of this type. I do not believe they exist.
The proposal made in 1978, was virtually forgotten until it came back to life in the 90´s. During almost a quarter of a century it had been only an economic hypothesis in the shadow of which controversies in favor and against it were waged, expanding the original proposal and aiding the appearance of associations whose only objective is to promote its implementation and destine the money collected to the needs of the Third World; for example, the ATTAC associations (Association for the Taxation of speculative financial Transactions for the Aid of Citizens), established in many countries. Thus, the Tobin Tax tries to be an economic argument capable of moderating, theoretically, the uncontrolled movement of purely speculative capital. The Tobin Tax, also theoretically, would permit collecting important resources destined to aid and develop poor countries, that is, a stunning fight against poverty. Understood in this way, the Tobin Tax becomes impotent and sterile in coming to the aid of poverty because it is a proposal for the future and poverty is a cruel reality at present that cannot wait because it is the direct cause of death of millions of human beings. While waiting for the Tobin Tax to bear fruit, poverty will have taken its toll.
The Tobin Tax has awakened political appetites as a first objective and its reasoning dealt with the collection of the tax on speculative capital movements in order to help citizens. The following press heading is suggestive.
“France has given the green light to the Tobin Tax, subject to the agreement of all the EU. Maximum taxation of 0,1% on foreign currency flow, beginning in 2003. The French Socialist Party promotes this levy in view of the double electoral commitment of next spring.”
Electoral strategy uncovered. Politically, the fight against poverty is a secondary action that could be postponed. Using the Tobin Tax, the time periods can be counted by decades. Meanwhile, the poor, if they die, will rot anywhere. They will not be counted in the statistics.
Montaner Tax versus Tobin Tax, What is the real significance of this challenge?
It is the confrontation between two proposals: the first is of immediate execution, directed preferably by the EU without the necessity of a prior consensus because it is a project that can be carried out by any sovereign nation; the second proposal is ambiguous, without any structured project, with hypothetical mid- and long-term results. There are neither agreements nor statutes that regulate the speculative monetary transactions and, consequently, it is impossible to establish any obligatory tax based on nothing. It is pure fiction to speculate on the collection of a maximum general tax of 0.1 percent.
The Montaner Tax is based on the productivity of work applied to the construction of homes as they are needed, without limit, with the support of a new financial system of accumulating resources, without debt, with the certainty of allotting part of these resources to taking care of the needs of poor countries. In graphic words I will say that the Tobin Tax is a fantasy, a speculation on the future that hopes to pinch part of the benefits obtained in speculative transactions, while the Montaner Tax is a present reality whose strength is in continued work, adequately remunerated, that generates benefits and substantial free resources that do not admit interpretations because they are guaranteed by financial calculations.
The Montaner Tax should not have this name because it is not a tax. In the Project that I present in this Website, elevated resources are generated, destined to different purposes that I will comment on in various editorials, such as the massive creation of jobs, pension funds, education, family protection and, especially, the Company Contract substituting the Work Contract. The Project demands sending a minimum of 2 to 5 percent of these resources to the poor countries, not in the form of consumable aid but rather in infrastructures, jobs, houses and education, stimulating the elevation of their standard of living with their own efforts.
Quantifying the Tobin Tax as to how much a general tax of 0.1 percent on financial transactions could reach, reminds me of counting your chickens before they hatch. The promoters must previously reach an agreement with the two forces that direct society, with their own interwoven, visible and invisible interests: political power with its inexhaustible line of ideas and personalities, and economic power with the voluminous presence of billions of dollars at stake, from all sources. Such an agreement is only a possibility in the shadows.
The Montaner Tax does not have these problems in quantifying the resources that it can contribute immediately in favor of poverty, because they have a physical presence with just the construction of a house. In the example “Globalize housing with zero cost”, I demonstrate that in just one program of building 500 houses, almost 10,500,000 euros can be obtained from available reserves. The 2 percent as a minimum percentage of the reserves obtained would be 209,800 euros. If we program the construction of 500,000 houses, the participation would equal 209,800,000 euros. If the EU promotes the project, the fifteen current countries would generate a participation in the reserves of 3,147,000,000 euros. In addition, there are many countries waiting to integrate in the EU. Outside of Europe there are four more continents with many nations that have the same problems of housing shortages. This is the immediate contribution of the Montaner Tax, without mentioning the financial capacity of the remainders, which by themselves can take care of and finance great infrastructural projects. All in real time.
It is necessary for the members of the European Commission not to forget that all their positions are temporary and that they should dedicate time to studying the Project that has been presented, explained and guaranteed by financial mathematics; see its viability and execute it. The communication media should be decisive in driving out official apathy and with their pens show the conscious perversity that not attending the needs of the poor countries and satiating the hunger of an abandoned infancy represents, when the means to accomplish it without demanding that anyone make an economic effort are available; the resources are there, waiting.
I believe that the Montaner Tax eclipses the Tobin Tax, by absolute K.O.