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In a declaration that will likely earn him the designation 'Enemy of the Capitalist State,' Pope Francis recently called upon the world to redistribute its wealth in order to reduce what is likely the greatest socio-economic scourge of our times, income inequality.
In his address to U.N. Secretary-General Ban Ki-moon and other U.N. leaders, the Pope said:
“Specifically, this involves challenging all forms of injustices and resisting the economy of exclusion, the throwaway culture and the culture of death which nowadays sadly risk becoming passively accepted” .
While Francis hinted that a more equitable tax regime would help in this goal, he was short on specifics. Perhaps progressive states in Europe have hit upon an elegant yet simple solution: the Robin Hood Tax, a.k.a. The Tobin Tax, also called, within its Eurpoean context, the European Financial Transaction Tax.
The levy, about which I have written previously on this blog, would be a painless and very progressive measure that could be used not only to address the aforementioned inequality, but also a host of other urgent issues confronting the world. It could create jobs; spur economic development beyond the financial industry; and combat climate change, global poverty and HIV/AIDS.
While it would be naive to believe that any one measure could solve all of our problems, the ability to mitigate them is clearly within the tax's purview.
In the current proposed version backed by an 11-nation coalition, here is how it would work, as reported by Katrina vanden Heuvel in The National:
The proposed tax includes a 0.1 percent tax on stock and bond trades and a tax of 0.01 percent on derivatives. It’s now expected that the tax will indeed be phased in, with the levy on stock-trades comprising the first step. Reportedly, the finance ministers involved in the negotiations plan to use the rest of the year to negotiate over taxes on derivative-trading, which could be introduced later in a second phase. While the German government is reportedly determined to get an agreement from the outset to include derivatives, there has been some resistance, including from the supposedly more left-wing French government.
Its benefits would be many. Opposition to it is fierce and passionate. But with every indication that it is rapidly moving toward a European implementation, a critical mass is being reached. The fact that progressivity is not dead in Europe should give us all enough heart to reignite our passion for a more equitable world, a world in which the neo-liberal agenda no longer completely holds sway as it gives to the few while willfully withholding from the many.
UPDATE: Well, it certainly didn't take long for the right-wing to react to the Pope's suggestion. Let's just say, they didn't take it well:
