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'An influential activist' - The Guardian

'Iain Dale, without the self loathing' - Matthew Fox in The New Statesman

You are a tinker...' - Tim Farron

Saturday 19 November 2011

"Give me a Tobin Tax and fiscal continence. But not yet"

Hmm. Here's my latest piece from The New Statesman, about the Tobin Tax. It's caused a bit of angst with one commentator saying it reads like a UKIP leaflet. Which is unfortunate as:

A) I'm a Pro Europe
B) I'm pro Tobin Tax
C) The piece reflects Lib Dem policy pretty much precisely
D) It also reflects the views of The Robin Hood campaign ( see this article in today's New Statesman, paragraph 8).

That same article has a right go at Vince Cable, who it accuses of having done an about turn on the Tobin Tax, now saying no when it was a manifesto commitment in 2010. In fact, the Lib Dem position is unchanged - the manifesto promise was to work towards a global FTT, not a European one.

Anyway, here's the piece that's caused all the trouble. Do let me know if it reads like I've become Nigel Farage, because that really wasn't what I was trying to say...

Sometime today, in a conference room in Berlin, David Cameron will indulge in a certain amount of spleen venting. No doubt a little tapping pointedly on the table will take place. Who knows, maybe he'll even advise his interlocutor to "listen to the Doctor dear".
And then with a bit of luck, Angela Merkel, bedecked in Lincoln Green, will lean over the table, and whisper "But David. I thought we were all in this together?"
What will have brought all this unpleasantness to pass? Why it's that new favourite wheeze of German and French politicians: the Tobin Tax.
Now, the Tobin tax is that strangest of beasts, a popular levy. One that the public would welcome with open arms. So how come we have the German Chancellor offering to take from the rich to give to the poor, while Cameron, Osborne, Balls and Cable all scramble to play the Sheriff of Nottingham, shouting "no, no, no"?
When all three major parties pass up the opportunity of a populist open goal, you know there must be more to this than meets the eye. And there is.
Firstly - and it would be easy to miss this -- the Lib Dems, Tories and Labour are all actually in favour of the Tobin tax. Everyone thinks it's a grand plan. Just not right now. And not in the form the Merkozy axis has proposed.
"Give me a Tobin tax and fiscal continence. But not yet," they are saying, in a St-Augustine-sort-of-a way.
So what's the problem?
Well the financial implications to London have been extensively written about already.
But there's another issue: French farmers.
No, really.
Of course, it's not just Normandy cheesemakers and the like. It's every other thing the EU spends money on -- though with large parts of the total EU budget going on the Common Agricultural Policy, French farmers are set fair to do well out of an EU wide Tobin tax.
How come? Because as things stand, revenue raised from The City of London would go, not to the Treasury, but to Brussels. You can write your own Daily Mail headlines, can't you? I expect Paul Dacre already has.
And that's the nub of the problem. With 70 per cent of its potential revenue coming from the UK, even the most pro-European British politicians fear that the Tobin tax, excellent idea though it is, may prove rather less popular with the British public when they see what the money is being spent on.
Because given the state of the Eurozone, Angela Merkel knows we're all in this together. But some of us are in it rather more than others.


  1. However if you say the money goes to Brussels, that is not the same as saying it goes to the government of Belgium. The EU spends money in the UK as well. In any case, there is also a need to reduce the volatility of City trading, and in particular the practice of magnifying the debt problems of EU member nations. Like it or not we are spending billions to help Greece and Italy at the moment.
    The point is that we have to do something that politically is very difficult. We have to stop thinking that someone else's problem is nothing to do with us. The truth is that the knock on effect will have everything to do with us.

  2. Thanks for this

    First off, you're quite right - it would go to Frankfurt :-)

    I agree we need to do our bit and make our contribution to sort this out. The 'stuff them' attitude helps no one. But I'm not convinced the best way to that is a EC only FTT. For that, I think far bigger/grander gestures will be necessary.