EDITORIAL: The U.N.’s global tax scheme

OPINION:

The world’s leftists dream of the day when they might erect an international taxation system. Such would be the bottomless well from which they could exploit the world’s productive energies to bankroll utopian schemes and build bigger, better and, most important, higher-paying global bureaucracies. Steps were taken last week to make this dream a reality.

At the Group of 20 meeting in South Korea, a coalition of 183 organizations from 42 countries called for a tax on financial transactions to raise funds to offset the impact of the global economic crisis. The so-called Robin Hood Tax would underwrite a number of programs with the purported aim of “reducing the unacceptably high rate of job loss, and achieve key development, health, education and climate change objectives in developing countries.” How this miracle would be achieved is unclear. Taking money from productive enterprise and sinking it into bloated government programs is an unlikely recipe for success. Nonetheless, proponents of the Robin Hood Tax are convinced that government austerity drives, such as the one under way in Britain, are more of a threat to the disadvantaged than looming worldwide insolvency.

Global warming is the favorite excuse cited to justify an international tax regime. Earlier this month, a U.N. climate commission proposed a tax on international financial transactions that would serve as a fund that poorer nations could use to mitigate the effects of “climate change.” Other taxes would be levied on international transport, which might include a special U.N. tax attached to airline tickets. U.N. Secretary-General Ban Ki-moon rather optimistically called the proposal “financially feasible and politically viable” and lectured that the proposal was “not about charity” but about “doing the right thing for those who are suffering most from a crisis that they did least to cause.” Perhaps extractions from this fund could be offset by matching cuts in foreign aid to those same nations.

There was a bit of good news in the battle against international leechcraft. On Oct. 21, the Chicago Climate Exchange announced it would no longer be involved in the carbon market. This group was founded a decade ago in hopes of cornering the U.S. market in carbon trading. The scheme depended on the imposition of a mandatory “cap-and-trade” system for so-called greenhouse-gas emissions reductions. For exchange shareholders, climate guilt would generate unlimited wealth. The potential scale of the carbon market, artificially created by government and manipulated by those with access and political pull, was estimated at $10 trillion. This would have been the largest transfer of wealth in history from the productive class to the politically connected.

The exchange was founded by Northwestern University business professor Richard Sandor, who parlayed $1.1 million in foundation grants into a $98.5 million payout when the enterprise was sold to Intercontinental Exchange in July 2010. That European carbon-trading outfit has profited from limits imposed by the Kyoto Protocol, which the United States wisely declined to ratify. Other investors included usual suspects such as Goldman Sachs and Al Gore’s Generation Investment Management. Barack Obama even served on the board of the ultraliberal Joyce Foundation, which supplied start-up grant funding.

Unfortunately for the global taxers, their views are not likely to have much traction in the middle of a worldwide economic downturn. It is easier to send people on guilt trips when they are not worried about simply surviving.