I submitted a comment to this blog, “From Poverty To Power”, by Duncan Green, who is involved with the Oxfam International website. Oxfam International, I should point out, is a highly political non-government organisation that promotes what seems to be a distinctly anti-trade, anti-capitalist agenda. He supports the idea of a tax on global financial transactions, that has sometimes been dubbed a “Robin Hood tax” (rob the rich and give to the poor, geddit?). Samizdata readers will know the blogger, Tim Worstall, well, who leaves a typically well-argued comment on the piece I link to. I decided to have a pop myself. I have no idea if my comment made it on (I used a different ID). Here it is:
“I love the way that some here dismiss Tim. For those who don’t know, he is an entrepreneur and I suspect, knows more about economics and business than most of the folk on this board. His point seems to be unanswerable: taxes are a cost. Indeed, that is often their point.”
“For instance, we tax alcohol and tobacco, for example, to drive down consumption for health reasons. Policymakers support imposing tax “costs” on certain items of consumption to reduce turnover. Sometimes, it is argued by people that property should be taxed more to discourage speculation in property, etc.”
“So it seems fairly clear that taxing financial transactions will mean there will be fewer transactions overall, and that the volume will decline. This will, as Tim Worstall states, reduce liquidity, widen the bid-offer spreads in financial markets for things such as currencies, bonds, equities, commodities and so on. It will therefore be more expensive for people to obtain mortgages, buy currencies when on holiday, and so on. Of course, the tax will affect groups differently – that is another issue. But there will be considerable knock-on effects.”
“Alan Doran: It is no doubt true that some funds will migrate to “rogue” tax havens where FTT does not hold sway. Well, a less negative way of putting it is that people do business where it is cheaper to do so, ie, where there are lower taxes. That is what is meant by economic freedom.”
“An example of this is when, in the very late 60s, a change to the US tax treatment of bonds encouraged the development of an offshore eurodollar market in London. Capital migrates. If people want to stop or cut financial transactions and prevent trade, they should be more honest about it.”
The idea of a financial transaction tax, or “Tobin Tax” (named after the economist, James Tobin) has been knocking around for some time. The Economist had a good item on it back in 2001.
Separately, Oxfam’s socialist tilt has been noted for a long time.
On all matters of taxation, all proposals, all implementations, all modifications, everything, definitive analysis will take us to:
The essential purpose of taxation is to provide for the functions of governments.
Every deviation from that essential purpose, for whatever social or political objectives will, proportionately to the deviation, erode the economic base on which the taxation falls.
There can be no clear or thorough analysis of any proposals for taxation without a concurrent examination and determination of the functions of government.
Oh the irony- I quote from Atlas Shrugged:
Ragnar Danneskjold: “But I’ve chosen a special mission of my own. I’m after a man whom I want to destroy. He died many centuries ago, but until the last trace of him is wiped out of men’s minds, we will not have a decent world to live in.”
Hank Rearden: “What man?”
Ragnar: “Robin Hood.”
Ragnar: “. . . [Robin Hood] is not remembered as a champion of property, but as a champion of need, not as a defender of the robbed, but as a provider of the poor. He is held to be the first man who assumed a halo of virtue by practicing charity with wealth which he did not own, by giving away goods which he had not produced, by making others pay for the luxury of his pity. He is the man who became a symbol of the idea that need, not achievement, is the source of rights, that we don’t have to produce, only to want, that the earned does not belong to us, but the unearned does. He became a justification for every mediocrity who, unable to make his own living, had demanded the power to dispose of the property of his betters, by proclaiming his willingness to devote his life to his inferiors at the price of robbing his superiors. It is this foulest of creatures – the double-parasite who lives on the sores of the poor and the blood of the rich – whom men have come to regard as the moral idea.” “. . . Do you wonder why the world is collapsing around us? That is what I am fighting, Mr. Rearden. Until men learn that of all human symbols, Robin Hood is the most immoral and the most contemptible, there will be no justice on earth and no way for mankind to survive.”
“Sometimes, it is argued by people that property should be taxed more to discourage speculation in property, etc.”
Apologies (I had a few drinks earlier)… for a split-second I initially read that as “poverty” rather than “property”… but then it occured to me that in any case it makes a lot of sense to describe inflation as a “poverty tax” and the existence of certain government progams as “speculation in poverty”…
What a steaming pile of tosh. The Robin Hood legend was about the long aftermath of the Norman Conquest, so to characterise him as an ‘enemy of property’ requires one to just gloss over the wholesale dispossession of property of landed Anglo-Saxons by the conquering Normans.
The Robin Hood story is all about fighting back against a rapacious Norman imposed political order… feudalism… that is what Rand has Ragnar Danneskjold raging against… resistance to the imposition of a feudal order. Not her finest moment to be sure.
@Perry.
I quote from Wiki – Robin Hood was an outlaw in English folklore. A highly skilled archer and swordsman, he is/was now known for “robbing from the rich and giving to the poor.”
And of course, Ayn Rand acknowledged the distinction you make:
Ragnar Danneskjold”It is said that he fought against the looting rulers and returned the loot to those who had been robbed, but that is not the meaning of the legend which has survived. He is remembered, not as a champion of property, but as a champion of need, not as a defender of the robbed, but as a provider of the poor. He is held to be the first man who assumed a halo of virtue by practicing charity with wealth which he did not own, by giving away goods which he had not produced, by making others pay for the luxury of his pity. He is the man who became the symbol of the idea that need, not achievement, is the source of rights, that we don’t have to produce, only to want, that the earned does not belong to us, but the unearned does. He became a justification for every mediocrity who, unable to make his own living, has demanded the power to dispose of the property of his betters, by proclaiming his willingness to devote his life to his inferiors at the price of robbing his superiors. It is this foulest of creatures—the double-parasite who lives on the sores, of the poor and the blood of the rich—whom men have come to regard as a moral ideal. And this has brought us to a world where the more a man produces, the closer he comes to the loss of all his rights, until, if his ability is great enough, he becomes a rightless creature delivered as prey to any claimant—while in order to be placed above rights, above principles, above morality, placed where anything is permitted to him, even plunder and murder, all a man has to do is to be in need. Do you wonder why the world is collapsing around us? That is what I am fighting, Mr.
Rearden. Until men learn that of all human symbols, Robin Hood is the most immoral and the most contemptible, there will be no justice on earth and no way for mankind to survive.”
Do you seriously contend that the reason these jokers are calling their tax a Robin Hood tax is because they and the communists who wrote the TV series(Link) are in favour of property rights?
I would love to see Robin Hood presented as a hero individual rights but that’s not going to happen – he is too compromised by his strapline.
Not just that, but wasn’t Robin Hood stealing from the nobility to financially starve Prince John (the usurper on King Richard’s throne) until the rightful King could return to England to deal with Prince John’s treason? That he could return some of the money taken from the peasantry in the first place at swordpoint was just a bonus.
So Ayn is upset that Robin Hood was fighting to keep the lawful authority in power while returning stolen good from the thieves back to the original rightful owners.
As an aside, regardless of what one might think about Ayn Rand or Objectivism, I think it is clear to anyone who read the Fountainhead or Atlas Shrugged that Rand needed an editor who was willing abd able to tell her “no” and “go back and rewrite that part” and “you’re just repeating yourself over and over and over” and “for the love of all things holy Ayn, Galt took sixty pages of speech to say what he said on page one.”
Perry (and Steven), you’re right about the true Robin Hood of the original legend, but the point being made by Ayn Rand (via Ragnar Danneskjold) is that the noble myth has been usurped by the thoroughly vile modern version, which holds that Robin Hood “took from the rich and gave to the poor”. Rand knew perfectly well that was not the original story, but she also knew what it had been perverted into. Her (Danneskjold’s) version is the one understood by most people today, and she was absolutely correct to regard it as thoroughly despicable. I know, and you know, that the Robin Hood of original legend took from the tax collecter and returned the money to those who had earned it, but I would bet that outside of these environs not one person in a hundred understands that. So until that public perception is changed, he is correctly viewed by libertarians (and Objectivists!) as an arch-villain.
“…we tax alcohol and tobacco, for example, to drive down consumption for health reasons…”
Not really, they are taxed because people use a lot of them, and are prepared to pay the tax. I’m pretty sure tobacco was taxed before it was known to have injurious effect.
How much did the Robbing Hood skim of for himself. Politicians just run protection rackets.
Well not on my side of the Atlantic it ain’t.
I do not think all that many Brits see Robin Hood as anything other than someone who took from the violent usurping rich by way of just restitution (i.e. sticking it to the Norman establishment who were imposing French style feudalism on England).
But also keep in mind that there is not a single Robin Hood myth and some of aspects of Hereward the Wake (who was certainly real) and other Saxon resisters bleed into the century later Robin Hood myths… such as Robin of Sherwood (the ‘classical’ version where he is usually an ‘English’ commoner, (ie a dispossessed Saxon)) or Robin of Locksley or Robin of Huntingdon (where he is a dispossessed noble, ie a ‘good’ Norman).
The notion Robin was doing his thing to support the absent Richard (ie supporting one set of Normans over another) is not a universal feature of all the Robin Hood myths but naturally that bit makes it all more palatable to the 14th century audiences looking at tales set a century earlier.
But in England all the variants of Robin are seen as no mere brigand but rather a leader of resistance to a rapacious ruling class dispossessing people of their property. So hardly a poster boy for socialist redistribution of wealth 🙂
I would be glad if that really were true in Britain, Perry, but in any event it most certainly is not the case over on this side of the Atlantic (and remember, this is where Rand was writing). Over here we’re not terribly interested in the Norman Conquest (even the few people educated enough to know what it was), and we certainly don’t think of Robin Hood as a resistance leader. Rand’s take on it very much represents the popular US perception; I regularly have to disabuse people of that notion and tell them the real story.
And since Europeans (and even your own Johnathan Pearce) are the ones referring to this proposed financial transactions tax as a “Robin Hood tax” I suggest that perhaps your assessment of your countrymen’s understanding of the legend is perhaps a bit generous. Sounds to me like an awful lot of them have the same understanding as we ignorant Americans.
The criticism that a Tobin tax is harmful because it will lead to reduction in financial transactions is problematic for one simple reason: except in a pure anarchist society, governments’ revenue requirements must be met from somewhere. Now, for any given rate of taxation, raising part of that requirement through a Tobin tax will mean less revenue raised through other means. So criticisms of the distorting effects of a Tobin tax only make sense as comparative claims, i.e. as claims that they are more or less distorting than alternative means of raising taxes .
It has not escaped me that there may be a political economy argument along the lines that the popularity of a Tobin tax (due, the cynic might say, to the fact that it is mostly imposed on other people) may mean a higher burden of tax overall. But since this argument is not in elaborated in the comment, I cannot evaluate its plausibility, as part of the critique in the original post.
Lindsay, why do you assume that “for any given rate of taxation, raising part of that requirement through a Tobin tax will mean less revenue raised through other means”? After all, we’re not talking about establishing a taxation scheme ab initio, with a targeted revenue level; we’re talking about adding yet another species of tax to the existing panoply of them. The goal surely is not “less revenue raised through other means”; it is more total revenue, period. So while I am sympathetic to your interest in the economically distortive effect of any particular tax, I think your point is completely misplaced in this context.
Well it is weird to talk about fictional people…but…
Robin Hood was against taxes not in favor of them.
Taxes of financial transactions only increases Governemnt power at expenses of bank clients.: you, me, your family, your friends, other people.
Perry, I am not sure – although it depends on whether British kids learn their history adequately – that people on this side of the Pond think about Robin Hood in the way that you describe. I am afraid Laird is right; Rand was attacking the widely-held “myth” of RH as the egalitarian redistributor. The fact that the supporters of the Tobin Tax are often leftwing capitalist bashers only reinforces that impression when they themselves use “Robin Hood” as a term of praise.
Interestingly, the recent film Robin Hood, starring Russell Crowe, contained the more low-tax, anti-government message. That fact has been noticed(Link).
Well that it hardly surprising to me as *that* is indeed the Robin Hood I learned about as a ‘yoof’ long before I ever heard the world ‘libertarian’ spoken for the first time.
Perry, of course. The point is, that Robin Hood means something different to you and I when compared to what, say a twat like Richard Murphy of the Tax Justice Network thinks.
Unfortunately, historical characters can take on new meanings. Us history buffs, alas, can find this very irritating.
I should add that the “Levellers” of the 17th Century in the UK, during the English Civil War, were actually pretty good on property rights, a fact that needs to be pointed out to old lefties such as Tony Benn.
For that matter, it often surprises some when it is pointed out that the Cherokee Indians in the area in what is now Texas had quite developed systems of law and property. And so on.
“I would love to see Robin Hood presented as a hero individual rights but that’s not going to happen”
Just watched Ridley Scott’s version, he’s pretty much a libertarian in that,
I checked wikipedia and apparently this is closer to the original legend
There is still a bit of lefist stuff in the Ridley Scott version – especially at the end (off to the ecowood and down with wealth), but not much of it.
ManikMonkee is correct – for most of the film Robin Hood (and the rest of the good side) are represented as anti tax – not just anti tax on the poor. And they are also presented as strongly patriotic.
So much for “paying your taxes is patriotism” as scumbags like Joe Biden would claim.
As for yet more tax and spend being good for the poor in the “Third World”…
Peter Bauer tried (in such works as “Dissent On Development”) to point out the basic wrongess of this doctrine.
But I doubt that university crowd (such as the Oxfam leadership) read such works.
Jonathan,
A little nit. The Cherokee inhabited parts of Tennessee, Georgia and the Carolinas – not Texas – before they were “removed” to the Oklahoma Territory. Maybe you were thinking of the Comanche? But it is true that the Cherokee recognized property rights and had their own system of law as well as their own written language.
They were also one of the tribes who did as was demanded of them and transitioned into a very successful and western style agricultural system complete with modern (of the time) techniques and labor (whites even worked for Cherokee land owners and farmers). The fact that they were removed after all this is, in my opinion, one of the very worst of the crimes committed against natives here in the U.S. Sad.
Ha, nicely put!! I like the idea about the “Robin Hood(Link) tax”. I first read this appointment and agree with you. Keep up the good work. Thanks a lot!
Looks like the smitebot is asleep again (or is secretly in the pay of Nottinghamshire).