Throwing Sand into the Money Machine
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- Published on Saturday, 11 April 2020 01:24
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A Socialist Project e-bulletin ... No. 2052 ... April 11, 2020
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Throwing Sand into the Money Machine:
German Pensions and the Financial Transaction Tax
Ingo Schmidt
Throwing sand into the machinery of financial markets was the goal Attac Germany set itself when it was founded 20 years ago. A financial transaction tax (FTT) was one of its core demands. Indeed, this provided the name for the original French organization that was founded two years prior: Association pour une taxation des transactions financières pour l’aide aux citoyens.
Few are aware of the cumbersome name behind the acronym. Today, only a small core of activists remember that it was the economist James Tobin, in 1978, who presented the idea for such a tax to the exclusive circles of fellow policy advisors. It was only twenty years later that Ignacio Ramonet, the former editor of Le Monde Diplomatique, introduced it to a critical public as a means of "disarming financial markets." And to great success, not the least because the idea of an FTT was so contentious that it became one of the crystallization points for the anti-... and alter-globalization movements.
The discontent with globalization remains, however, this is now expressed less in demands for the regulation and reconfiguration of the economy than in the desire for a national homeland that is harmonious and free of foreigners. Attac in Germany has adjusted itself to this new setting. During its 20th anniversary celebration in St. Paul’s Church in Frankfurt, talk was of democracy, human rights and the dangers of a new fascism. The disarming of markets was not on the agenda. The issue has largely disappeared from public discussion, and instead, has ended up in the parliamentary legislative mill.
In 2011, the FTT was taken up by the European Union. Showing some receptiveness to the idea at the height of the Euro crisis was certainly good PR. However, what was decided upon instead was a fiscal-pact for the socialization of the losses incurred by the large financial corporations. The idea for an FTT has since then been adopted by Germany’s social democratic finance minister Olaf Scholz, who is aiming at a type of pact between financial markets and the welfare state. The revenue from an FTT would be used to finance the public pension system. However, the manner in which he is proceeding could see his plan quickly fizzle out.
