By Joe Higgins.
The Oxfam Davos Report published on January 18 got relatively little media coverage here and was buried after twenty-four hours. Yet its content is truly shocking, pointing to a world that is witnessing massive inequality and an ever-widening chasm in the wealth of the big majority of humanity as against that of a tiny elite. For the first time in history the wealth of the richest 1% is greater than the aggregated wealth of the remaining 99%.
€40 billion annual profits of Irish registered companies lie completely outside the
This should be a central feature in the current General Election campaign because it has huge ramifications for global developments that will impact on Ireland but also because chronic inequality is growing apace in this State also. You wouldn’t think that from the statements of the establishment political parties, nor from the issues emphasised by the big-business-owned media. In fact there is a concerted effort to not go there as seen in the controversy around the so-called ‘fiscal space’.
The contrived debate on the fiscal space is really designed to shut down any meaningful discussion on what wealth exists here and how it should be shared and managed. It wants to confine commentary to the narrowest of parameters around an estimated €10 billion that will be available in extra public spending over the next five years based on assumptions of a certain level of economic growth.
What this shuts out is any opening up of a debate on the massive wealth that exists outside of the current parameters of taxation policy and practice. Hence we have not only Fine Gael, Labour and Fianna Fail focusing obsessively on this, but Sinn Féin also chastising the other parties for being ‘irresponsible’ in their approach in exaggerating the amount available.
Excluded therefore is any consideration of the €30 billion in extra wealth that the richest 300 in this State have garnered since 2010 according to the Sunday Independent Rich List while the majority groaned under the yoke of austerity. Excluded also are the massive profits reaped by big business including the major multinational corporations and the derisory tax that is levied on them.
It is well known that the headline 12.5% corporation rate is but a vague target. It would be very generous to the corporations to say, as Eurostat figures do, that they pay an effective rate of 8.3% but if we were to take that as true, it would mean a very significant €2 billion each year could be raised if the headline were insisted on. Over five years that would immediately double the ‘fiscal space’. For every 1% increase after that there would be an extra annual €500 million for public investment and services. This is not even to take account of the work of Trinity College Associate Professor of Finance, Jim Stewart, who told an Oireachtas Subcommittee in 2014 that a massive €40 billion annual profits of Irish registered companies lies completely outside the tax net.
The Anti Austerity Alliance Budget Statement from October 2015 outlines how massively increased resources could be made available for major public investment in areas like social and affordable homes and greatly improved public services by taxing the real wealth that exists. Where these extra funds could be raised in addition to the corporation tax increased intake, would be a ‘millionaires’ tax on wealth, an increase in tax for individuals earning over €100,000 per year and a Financial Transactions Tax. Depending on the rates applied, extra income of up to €10 billion a year could be realised. In view of the Oxfam report and the growing inequality in Ireland itself the debate should urgently begin on national and international taxation policy and the massive shift of wealth from the 1% to the 99%.
In the United States Bernie Sanders, describing himself as a democratic socialist, is generating major political waves and massive support among working people and the poor, with his call for a “‘political revolution”. The Left in Ireland is the only force that is attempting to inject similar ideas in to the election campaign here. If the electoral initiative of the Anti Austerity Alliance-People Before Profit achieves the requisite seven Dáil deputies to form an official parliamentary group in the next Dáil, that debate can be significantly advanced here also.
Joe Higgins TD is Director of Elections for the Anti-Austerity Alliance