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John Rentoul
John Rentoul is chief political commentator for The Independent on Sunday, and visiting fellow at Queen Mary, University of London, where he teaches contemporary history. Previously he was chief leader writer for The Independent. He has written a biography of Tony Blair, whom he admired more at the end of his time in office than he did at the beginning.
You can contact John in the comments area or email him at j.rentoul@independent.co.uk
You can contact John in the comments area or email him at j.rentoul@independent.co.uk
A financial transactions tax is a bad idea, and the incomparable Chris Dillow explains why. Gordon Brown knows enough economics to know this. So why did he propose it? More than that, he must have known that Tim Geithner opposed it, even if he did not know that the US Treasury Secretary would slap it down so dismissively within minutes of yesterday's G20 news conference. So, really, why did he propose it? (Right: Geithner, Obama and Brown at the London G20 in April.)
Possibly a bit of grandstanding for the domestic bash-a-banker audience. A bit of grandstanding for the developing nations demanding cash for carbon to make the Copenhagen climate-change summit work. And possibly just because such a tax could raise a lot of money, which is always useful for politicians, and especially politicians that have trashed their national finances as comprehensively as Brown has done.
But, as Dillow points out, a transactions tax has to be global to work, and the opposition of the US puts paid to that.
And if raising money or greenery were Brown's motive, he would stand a better chance of getting a global agreement to tax aviation fuel, or carbon fuels generally.
Comments
Given that, and subsequent events, isn't is possible that perhaps he believes it's a good idea?
Just because both you and Chris Dillow think something is wrong doesn't mean it's impossible for someone else to think otherwise. To think otherwise would be a touch immodest of you, particularly given the inventor of the Tobin tax is one up on you in having got that minor Nobel Prize in Economics thing :-)