A Thousand Economists Recommend the Robin Hood Tax

Source: Intermon Oxfam

In a letter to the G-20 economy ministers assembled in Washington, a thousand economists have expressed their support for the Robin Hood tax on speculative financial transactions. Those who signed the letter include leading figures from universities like Oxford, Cambridge, Harvard, Berkeley and the Sorbonne.

On 13 April more than 1,000 economists from 53 countries sent a letter to the economy ministers of the G-20 countries - who were to meet the following day in Washington - urging them to implement the Robin Hood tax to help in the fight against poverty, to combat the effects of climate change and to reduce social inequalities. 

They also sent the letter to the businessman Bill Gates, who the President of France, Nicolas Sarkozy, in his capacity as President of the G-20 in 2010, asked to study innovative ways to finance development. 

This initiative has now been backed by more and more governments including the French and the Germans, who support levying a tax of 0.05% on speculative financial transactions, and by renowned economists like the Nobel Prize winners Paul Krugman and Joseph Stiglitz. 

Among those who signed the letter are economists like Jeffrey Sachs, Director of the Earth Institute of the University of Columbia and special adviser to the Secretary General of the United Nations, Ban Ki Moon; Christian Fauliau, ex-head of the World Bank, Dani Rodrik from Harvard and Ha Joon Chang from Cambridge University.

Sachs said, “It is time for the G-20 to come to a consensus in favour of the (Robin Hood) tax on financial transactions to help developing countries in their fight against hunger, climate change, and the economic crisis, which they did not cause. This tax should also contribute in a fair and efficient way to the fiscal consolidation of our countries.”

The initiative has also received support from figures from Spanish universities like the Complutense, the Pontificia Comillas and that of the Basque Country, in addition to economists from Spanish academic institutions like the Real Instituto Elcano and the Alternativas and IDEAS foundations. 

The letter sent to the ministers points out that “…the crisis has laid bare the risks of not regulating financial activities, and of their increasing disconnectedness from the real economy. The financial sector now has a responsibility to contribute to repairing the damage its excesses have caused, and it should pay back to society a fair portion of the profits it has made. A tax of 0.05% would also act as a disincentive to excessive speculation, which underlies current economic imbalances”. 

The letter says that if the Robin Hood tax was levied it could yield 300,000 million euros per year to help millions of people suffering the effects of the economic crisis and climate change. 

Susana Ruiz, the spokesperson for Intermon Oxfam, said, “The G20 should listen to this international movement, which is growing stronger every day and which has now been joined by specialists in economics. The fact that a large number of people from the elite of world economic thought are involved in this initiative makes it unanswerable”.