Posted
01st September 2001
USA Seeding Leadership To Europe
The creed `follow the money' is losing its oomph as people smell
a rat in the perspective painted by the PR men of a global economy
where corporates rule. The French slogan `La patrion danger!'
was enough to rouse a nation to bloody revolution and counter
revolution. In france culture has not given way completely to
avarice. Its in France that, as in 68, a foretaste of things
to come is reaching the sensitive political palate. New Zealanders
would do well to re-new our acquaintance with things European.
Global
protests have convinced Mr Jospin of the need to respond. by
BBC News Online's Steve Schifferes
France
has become the first major industrialised country to support
proposals for a tax on international financial transactions.
Lionel Jospin, the French Prime Minister who is expected to
stand in next year's presidential elections, told French television
that he would be putting forward proposals for the so-called
"Tobin tax" at the next meeting of European finance ministers.
The Tobin tax - named after Professor James Tobin, the Yale
professor of economics and Nobel prize winner - would impose
a tax of 1% on all international currency trades. Mr Jospin
must still convince sceptical leaders of other rich countries
The
idea would be to reduce speculation against certain currencies,
and to raise money which could be used for development in less
economically developed countries. With global trade on the foreign
exchange markets alone running at $1,500bn every day, the tax
could in theory raise many billions - and some predict it could
more than double aid flows from rich to poor countries.
Mr
Jospin said he was responding to the concerns of the anti-globalisation
movement, which has a strong base in France among farmers and
intellectuals, after the violent protests in Genoa last month
during the G8 summit of world leaders. The French pressure group,
Attac, which has been campaigning for the Tobin tax, welcomed
the move. Its leader, Bernard Cassen, is seeking a meeting with
Mr Jospin ahead of the Ecofin summit. The UK campaign group,
War on Want, also called for Britain to follow France's lead.
War on Want's Senior Campaigner Steve Tibbett said: "The French
are the key to turning the idea of the Tobin tax into a political
reality. If we can find wider support, then we really can change
the lives of millions in the developing world by raising some
serious money and calming world markets at the same time."
However,
Mr Jospin's move is unlikely to find favour among many other
governments - or indeed within his own finance ministry. Last
year, French finance minister Laurent Fabius - a political rival
of Mr Jospin's - told France's National Assembly that such a
tax would destabilise foreign exchange markets, be difficult
to implement, and would not hit the speculators it was designed
to curb. The Tobin tax has become one of the key demands of
many anti-globalisation protesters. From the development lobby's
point of view, it has the advantage of combining regulation
of the international financial system with a means of raising
money for development to counteract the falling aid budgets
of most rich countries. The Tobin tax - and the need for an
international tax regime - has also gained the reluctant endorsement
of the Zedillo Commission, a UN report on development finance
which calls for an international tax organisation.
But
the notion has been widely attacked by many economists who believe
that in a world of free capital markets it would be impossible
to enforce and counter-productive if it prevented necessary
exchange rate adjustments and capital flows to poor countries.
However, after the rapid currency devaluations during the Asian
and Russian crisis, the idea has been attracting more interest.
And the widespread belief that the euro is undervalued by the
markets against the dollar has contributed to the proposal's
support in France. Countries with a large international banking
sector, such as the UK, the United States, Germany and the Netherlands,
are likely to be strongly against the plan.
Mr
Jospin may hope that by positioning France - already the most
protectionist country in the EU - as the patron of the anti-globalisation
movement, he can capitalise on the discomfort felt by many European
governments over the policies of the new Bush adminstration
in the United States. In another speech, France's foreign minister,
Hubert Vedrine, accused the US of hampering efforts to solve
global probems, especially in relation to the environment. "We
shall pursue our efforts towards a humane and controlled globalisation,
even if the new high-handed American unilateralism doesn't help
matters," he told French diplomats at an annual seminar in Paris.....
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