NationStates Jolt Archive

Leonard Cato Otterby and Pazu-Lenny Kasigi-Nero, Un Ambassadors from Compadria and Love and Esterel, would like to introduce a new draft proposal: "Balanced Tobin Tax"

Please feel free to contribute any criticisms, suggestions and points you might have.

We want just to emphasize that this proposition will not increase the total taxation in any nation, as -2- will counterbalance and the sum=0
-------------------------------------------
“Balanced Tobin Tax”

Category: Political Stability
Strength: Significant
Proposed by: Love and esterel

The United Nations,

-A- CONCERNED with the political and economical stability of nations, related to currencies exchange rates

-B- CONVINCED that currencies exchange rates should reflect Relative Purchasing Power Parity, the rate at which one unit of currency will purchase the same amount of a basket goods and services

-C- CONVINCED that smooth variations of currencies exchange rate are better for international trade and economic growth

-D- ALARMED BY that many times unrealistic fast variations of currencies exchange rates and/or uncorrelated Relative Purchase Power Parity are due to some wild speculation

-E- DESIRING to prevent the speculation mentioned in [D], while encouraging free-floating or pegged floating rates

-F- AFFIRMING that there are no reason why currencies transactions should not be taxed while income or selling of products and services are

-G- AFFIRMING that this document doesn’t want to increase total taxation in any nation

-H- DEFINING for the purposes of this document the “Tobin Tax”, as the taxation, at the rate of 0.1%, of every financial transactions of currencies, or derivatives with one or several currency (ies) as the underlying(s), including but not limited to: futures, forwards, options and swaps - it shall be noted that this tax will be collected by nations, not by the UN, and that the easy manner to collect it, is similar to how Value-Added-tax is collected


-1- MANDATES all members to implement the “Tobin tax” as defined in [H].

-2- MANDATES all members to decrease for an equivalent amount their others taxes, including but not limited to: income tax or value-added tax, in order to keep the same ratio of total taxation as a percentage of GDP, which they had prior to implementing the Tobin Tax outlined in this resolution

Co-authored by: Compadria

Don't think i'm stupid but could someone tell me in plain english what a tobin tax is and what it does.

then i'll be able to properly understand this.

Kaigan Miromuta, Ambassador for the Empire

Don't think i'm stupid but could someone tell me in plain english what a tobin tax is and what it does.

It's an agent of communist oppression, and it destroys the global economy.

Here ya go, Kirisubo.

Communist Oppression (http://en.wikipedia.org/wiki/Tobin_tax)

Before anyone complains about it, I'm pretty sure Rep in Tax is not a problem here. Rep in Tax is about national governments' ability to control what they tax on domestic goods. It doesn't stop UN taxes, nor does it stop UN control of national taxes on international trade goods (which is, I've always thought, what the Tobin Tax is about).



That said, I ___________the draft. I think it should be _______________________.
-----------(support/hate)---------------------------(passed/burnt an stompt on)
And the author should be _______________ for his or her __________________.
------------------------(canoodled/stoned)------------(ingenuity/debauchery)

Don't think i'm stupid but could someone tell me in plain english what a tobin tax is and what it does.

then i'll be able to properly understand this.

Kaigan Miromuta, Ambassador for the Empire

Of course, we are sorry as this proposal will be technical, an will try to improve the text to be more understandable.

What it is:
A tobin tax is a tax on currency transactions: when there is an exchange between 2 or more currencies.

It can be compared to VAT, as you pay a tax when you buy goods or services, or compared to the tax you pay when you buy a house.


What it does:
As the rate is very low, in this proposal 0.1%, it's insignificant for most personal or business transactions, hovewer it can have a small effect on speculation, as speculators buy and sell often.

Then it doesn't stop at all the free-floating of a currency, it just regulate it, in order to avoid unjustified big move of currency rate due to speculation.

Furthermore, our draft doesn't want to propose a classical tobin tax, because, we absolutly don't want nations to increase their total amount of tax.

It's why -2- is very important and mandates nations to decrease others taxes
to counterbalance and then the sum=0.

This will allow nation to DECREASE income tax or VAT or others, without increasing deficit

i give my thanks to the ambassador from The-Republic for the article. i'll consider this over a drink in the strangers bar and do some extra research.

Ambassador Kasigi-Nero, i'll also consider your arguments.

Kaigan Miromuta, UN Ambassador from Kirisubo

I'm a little perplexed as to the necessity of -2-.

Why mandate this? Sure, you could suggest it or offer it as an example to keep overall tax rates the same, but I see no reason to require nations to decrease their other taxes.

Gorgias
Speaker to the UN

-2- is essantial
LAE will NEVER propose/support a Tobin tax without -2-
We absolutly don't want nations to increase their Total taxes

Er...the whole point of the Tobin Tax is that the taxation only hits the speculators. Decreasing general taxation makes no sense as a compensation for one very specific tax bracket. We're not talking alcohol duties; money speculation is a minority concern.

Er...the whole point of the Tobin Tax is that the taxation only hits the speculators. Decreasing general taxation makes no sense as a compensation for one very specific tax bracket. We're not talking alcohol duties; money speculation is a minority concern.

We are not academician, we are pagmatic, we will never propose/support a "classical tobin tax", as it doesn't suit us.

We just think, the "classical tobin tax" is a good idea with a bad side effect, and
our ""Balanced Tobin Tax" keep the good idea, while deleting the "bad side effect" by clause -2-

And then, clause -2- engender a "good side effect", as members economy will be improved by the decrease of Income tax or VAT

We are not academician, we are pagmatic, we will never propose/support a "classical tobin tax", as it doesn't suit us.

We just think, the "classical tobin tax" is a good idea with a bad side effect, and
our ""Balanced Tobin Tax" keep the good idea, while deleting the "bad side effect" by clause -2-

...what?

Let me put it this way: regardless of economic impact, the immediate taxation burden is borne ONLY by speculators. Why, then, should one change general taxation policies?

...what?

Let me put it this way: regardless of economic impact, the immediate taxation burden is borne ONLY by speculators. Why, then, should one change general taxation policies?


Because everything is global, the total ammount of tax/ GDP, is a very important ratio.

Because everything is global, the total ammount of tax/ GDP, is a very important ratio.

Could you please answer my question?

ok, sorry if i was unclear:

without -2-, there is a risk that government will spend this money, this is not the objective.

Ok, I give up. I can't understand you; you can't understand me.

Next objection: so foreign exchange can't be traded as easily in the UN. There are 80,000 non-UN nations, some of whom I share borders with. Where do you think money speculators are going to head?

Ok, I give up. I can't understand you; you can't understand me.

Next objection: so foreign exchange can't be traded as easily in the UN. There are 80,000 non-UN nations, some of whom I share borders with. Where do you think money speculators are going to head?


The tax is only 0.1%, and furthermore, only currencies (and currencies derivaties) will be taxed.

Stocks, bonds and their derivatives and others derivatives basd on interest rates will not be taxed. The incentive to move wil not be great, and the financials markets might apprciate the economic and stability efffects on the "Balanced Tobin Tax" zone.

The tax is only 0.1%, and furthermore, only currencies (and currencies derivaties) will be taxed.

Stocks, bonds and their derivatives and others derivatives basd on interest rates will not be taxed. The incentive to move wil not be great, and the financials markets might apprciate the economic and stability efffects on the "Balanced Tobin Tax" zone.

That is utter bullshit. If this is a disincentive, then it is a disincentive, and they will transfer their transactions. If not, then there's no point to it. Which is it to be?

Incidentally, it would have to be on forwards and derivatives too, meaning setting a flat rate is in any case meaningless, as it would need to be a type-based rate.

Ok, I give up. I can't understand you; you can't understand me.

Next objection: so foreign exchange can't be traded as easily in the UN. There are 80,000 non-UN nations, some of whom I share borders with. Where do you think money speculators are going to head?

Before I answer this particular point, there are two other points that have been raised that I wish to address.

Firstly, the matter of overall taxation. This tax is designed as a protectionary (not protectionist) tool, that shields mainly smaller nations from the effects of short-term speculation, which can create currency instability and force high rises in interest-rates as a compensation, with knock-on effects of consumers. So in fact, contrary to what Gruenber believes, this is not a minority concern.

Secondly, the tax is not a fund-raising instrument, it shall be balanced by appropriate reductions in tax, because otherwise this will simply act as a stifle on investment. A country could reduce other taxation by the same amount to compensate. Furthermore, the rate is, as Love and Esterel has pointed out, very low and shouldn't put off speculators.

This should, through stabilising the currency markets, increase business and public confidence in a currency and attract more investors through the ameliorated state of international currency markets, boosting demand and leading to greater dynanism in the various economies of U.N. nations.

May the blessings of our otters be upon you.

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

That is utter bullshit. If this is a disincentive, then it is a disincentive, and they will transfer their transactions. If not, then there's no point to it. Which is it to be?

Incidentally, it would have to be on forwards and derivatives too, meaning setting a flat rate is in any case meaningless, as it would need to be a type-based rate.

What you migt consider, is that every tax has obviously bad effects:
-VAT decrease selling of goods and service
-Income tax decrease Consumption
-profit taxes decrease Investment
and so on

So the objective of every sensible government is to try to find a raesonable combination between all taxes.

We observe that currency transactions are not taxed, and we ask WHY?
WHY is it better to tax Income or selling of goods and services instead of currency transactions.

This proposition want to implement a small taxation on currency transactions, in order to decrease income tax and VAT

Pardon my lack of economics degree, but wouldn't this resolution hurt international trade?

And besides, when does the UN get to decide how much to tax my citizens even if it's only the speculators?

- Titus Chain
UN Ambassodor

This should, through stabilising the currency markets, increase business and public confidence in a currency and attract more investors through the ameliorated state of international currency markets, boosting demand and leading to greater dynanism in the various economies of U.N. nations.

I dislike the word 'stability'. It's a truism: you can't argue against being stable, seems too good. But 'stability' is not a positive aim in and of itself; currency exchange rates require a certain amount of ability to adapt to changing market forces.

And, please. Any Tobin Tax is going to shift money speculators away from UN nations, to the extent that its impact will be much bigger than your "just a little one" rhetoric suggests.

So the objective of every sensible government is to try to find a raesonable combination between all taxes.

What is 'reasonable'? And since when did a government have to be 'sensible' to join the UN? Oh, that's right. Since you joined, and decided that everyone has to conform to your ideals. YOU CANNOT ACCOUNT FOR THE ECONOMIC EXIGENCIES OF 30,000 NATIONS. I'd suggest you not try to pretend otherwise. Taxation is an inherently localised thing; there are nations with 100% tax rates; there are those without them. Who are you to suggest one system is better than another? Oh, of course. You're Love and esterel, the UN's spiritual moral guardian.

What is 'reasonable'? And since when did a government have to be 'sensible' to join the UN? Oh, that's right. Since you joined, and decided that everyone has to conform to your ideals. YOU CANNOT ACCOUNT FOR THE ECONOMIC EXIGENCIES OF 30,000 NATIONS. I'd suggest you not try to pretend otherwise. Taxation is an inherently localised thing; there are nations with 100% tax rates; there are those without them. Who are you to suggest one system is better than another? Oh, of course. You're Love and esterel, the UN's spiritual moral guardian.

No one is suggesting we're going to be able to completely account for every economic exigency for every single U.N. nation. What we're trying to do is iron out some of the risks we feel are present under the international trade systems, with regards to currency speculation.

Equally, when we mentioned stability, no where did we say 'ability' would be compromised. I would like to iterate that this is not targeting flexibility, merely imposing certain pre-conditions prior to investing in another currency.

I'll consult with L&E the possibility of vagueifying the rate of taxation.

May the blessings of our otters be upon you.

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

No one is suggesting we're going to be able to completely account for every economic exigency for every single U.N. nation. What we're trying to do is iron out some of the risks we feel are present under the international trade systems, with regards to currency speculation.

Equally, when we mentioned stability, no where did we say 'ability' would be compromised. I would like to iterate that this is not targeting flexibility, merely imposing certain pre-conditions prior to investing in another currency.

I'll consult with L&E the possibility of vagueifying the rate of taxation.

...so you're admitting that this won't be suitable for everyone? Yet, I suspect, you're going to continue to keep pushing this. Gah.

Anyway, you are going to need to vague down the rates, because I can't see how any system that sets the same rate for spot transactions as for derivatives would work.

...so you're admitting that this won't be suitable for everyone? Yet, I suspect, you're going to continue to keep pushing this. Gah.

Anyway, you are going to need to vague down the rates, because I can't see how any system that sets the same rate for spot transactions as for derivatives would work.

Define 'suitable'.

And you're damn right we're going to keep up this fight.

Nul Desperandum

May the blessings of our otters be upon you.

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

Define 'suitable'.
And you're damn right we're going to keep up this fight.

'Suitable' = appropriate for legislation, i.e. distinguishing between different situations, capable of responding to (in the preemptive sense as well) the variations in national economic climates.

And it's nice to know that your attitude to legislation is that you would foist your morality upon others regardless of whether objections are raised or not.

'Suitable' = appropriate for legislation, i.e. distinguishing between different situations, capable of responding to (in the preemptive sense as well) the variations in national economic climates.

And it's nice to know that your attitude to legislation is that you would foist your morality upon others regardless of whether objections are raised or not.

This is just a proposal, which will have to pass 2 democratic process (approvals and then vote if the first is completed)

http://test256.free.fr/UN%20Cards/values.jpg

'Suitable' = appropriate for legislation, i.e. distinguishing between different situations, capable of responding to (in the preemptive sense as well) the variations in national economic climates.

And it's nice to know that your attitude to legislation is that you would foist your morality upon others regardless of whether objections are raised or not.

Who said anything about morality? We're talking about economics here and as far as I'm concerned, the market knows no ethical system other than one which benefits it in some way.

And I accept your definition of suitable, though it doesn't change my position.

May the blessings of our otters be upon you.

Anthony Holt
Ambassador for the Republic of Compadria to the U.N.

OOC:

Nice card L&E:)

Who said anything about morality? We're talking about economics here and as far as I'm concerned, the market knows no ethical system other than one which benefits it in some way.

And I accept your definition of suitable, though it doesn't change my position.

So you accept that your proposal isn't suitable, yet you're 'not going to give up the fight'. What a responsible attitude. Good job we're not making globally binding laws here.

Oh wait...

In any case, you flipped from morality to ethics in 17 words. The latter is irrelevant; the former is. The morality of a Tobin Tax is to suggest that people do not have the right to engage in free currency speculation. That is an implicitly moral statement. Fiddling with market economics is intrinsically moral - although I consider it pretty immoral to suggest that we should introduce a Tobin Tax simply because we don't already have one, whereas we do have an income tax. It should, of course, be noted that the UN has never ruled on either, and thus it is entirely possible there are countries without income taxes in the UN (I know of some), or which use a Tobin Tax already (I admittedly don't know of any, because having one in a system where there is not global adoption makes little sense).

We cannot support this, this is a tarriff on the high end of the services industry.

This is not suitable for anyone, how can a nation become a more prosperous nation, if its banks cannot become global? Investment will suffer.
People going on holiday will suffer.

We find this law to be ridiculous, it is protectionist, that was even said by its defenders. We as a free trade nation deplore this proposal.
Pardon my lack of economics degree, but wouldn't this resolution hurt international trade?

Yes, yes it would, on a vast scale. It would also harm development, which as we all should know, happens most in small countries, as more developed are mature.

This proposal is insane. We cannot emphasize this enough, this is enforced protectionism.

OOC*dies*

The morality of a Tobin Tax is to suggest that people do not have the right to engage in free currency speculation.

The morality of an Income tax is to suggest that people do not have the right to have a salary?

The morailty of a VAT is to suggest that people do not have the right to buy some goods and services?

So you accept that your proposal isn't suitable, yet you're 'not going to give up the fight'. What a responsible attitude. Good job we're not making globally binding laws here.

Oh wait...

In any case, you flipped from morality to ethics in 17 words. The latter is irrelevant; the former is. The morality of a Tobin Tax is to suggest that people do not have the right to engage in free currency speculation. That is an implicitly moral statement. Fiddling with market economics is intrinsically moral - although I consider it pretty immoral to suggest that we should introduce a Tobin Tax simply because we don't already have one, whereas we do have an income tax. It should, of course, be noted that the UN has never ruled on either, and thus it is entirely possible there are countries without income taxes in the UN (I know of some), or which use a Tobin Tax already (I admittedly don't know of any, because having one in a system where there is not global adoption makes little sense).

Oh bloody hell....

I'll try and explain our position a tad more clearly. We are not saying it is moral or immoral to engage in short term currency speculation. We are not saying it is moral/immoral to engage in any currency speculation.

We are trying to reduce the abuses of the system, where relevant.

Moral applies to that which is innately regarded as right or wrong. Ethics is the study of morality. The company will follow a system of morals, under an ethical code, not an system of ethics under a moral code.

May the blessings of our otters be upon you.

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

The morality of an Income tax is to suggest that people do not have the right to have a salary?

The morailty of a VAT is to suggest that people do not have the right to buy some goods and services?

Pretty much. I should have said 'inalienable right', of course.

Now, you probably disagree with me here. Interesting. That would almost imply people can take different moral stances on the issue of taxation.

We cannot support this, this is a tarriff on the high end of the services industry.

This is not suitable for anyone, how can a nation become a more prosperous nation, if its banks cannot become global? Investment will suffer.
People going on holiday will suffer.

We find this law to be ridiculous, it is protectionist, that was even said by its defenders. We as a free trade nation deplore this proposal.

Yes, yes it would, on a vast scale. It would also harm development, which as we all should know, happens most in small countries, as more developed are mature.

This proposal is insane. We cannot emphasize this enough, this is enforced protectionism.

OOC*dies*

I respectfully differ. This is, we note a PROTECTIONARY measure, note a protectionist one. The two are not the same.

I'm sure equally as a free-trade nation, Darkyin should support this, because free-trade only works with decent trading partners. If a company is burnt out economically, due to the activities of rampant speculators, then it is not a particularly viable trading partner.

Equally, this does not affect national trade links of a free nature, merely the economic activity of individuals, thus it is not as 'restrictive' as Darkyin makes out.

May the blessings of our otters be upon you.

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

We are trying to reduce the abuses of the system, where relevant.

The system you outline is anything but relevant. It takes no account of the fact that short-term speculation can be very useful. By inhibiting this - and let's repeat that any taxation is likely to cause a shift in speculation away from UN economies, although I'm unwilling to fully commit to an opinion on this until the full rates are revealed - you are not in any being 'relevant' to the effects of the speculations, but rather providing a knee-jerk reaction to a problem that can be solved in far better ways, that might actually work.

The system you outline is anything but relevant. It takes no account of the fact that short-term speculation can be very useful. By inhibiting this - and let's repeat that any taxation is likely to cause a shift in speculation away from UN economies, although I'm unwilling to fully commit to an opinion on this until the full rates are revealed - you are not in any being 'relevant' to the effects of the speculations, but rather providing a knee-jerk reaction to a problem that can be solved in far better ways, that might actually work.

We are taking account of the useful nature of short-term speculation, in some cases, by keeping the overall rate of taxation low, as a general principle, though we have not yet come to a concrete solution as to the eventual rate that is to be set.

And what would you suggest, might I ask? And how, furthermore, would this respect the National Sovereignty so beloved to you?

May the blessings of our otters be upon you

Anthony Holt
Deputy Ambassador for the Republic of Compadria to the U.N.

Equally, this does not affect national trade links of a free nature, merely the economic activity of individuals, thus it is not as 'restrictive' as Darkyin makes out.
We question your knowledge of international economics.
We ask, is the private sector not the largest sector within international economics?
Even at low tax rates, this would wipe hundreds of billions of [credit units] off the face of the economic world.
Everyone from package holiday makers to globalised oil companies would be affected by this proposal.
Pension and Hedge Funds, the biggest suppliers of private investment, would cease to invest in currency speculation, this would damage the pension funds as it denies them a source of revenue, this would deprive the currency markets of there biggest customers and possibly create a recession.
Although the stated figure of 0.1% may seem tiny, the psychological impact combined with the actual monetary impact would be devastating.

Economics has its own checks and balances, although the bottom may drop out of a currency, that is only one pressure applied to that country which can be counter acted by equal pressures from within the country.

We still oppose this measure, vehemently.


El Edito: We also ask, what would happen to normal bank accounts when people goto another nation and take out money in that currency, but at no point does it touch anothers hands.

We are taking account of the useful nature of short-term speculation, in some cases, by keeping the overall rate of taxation low, as a general principle, though we have not yet come to a concrete solution as to the eventual rate that is to be set.

So how will this discourage irresponsible investment? It will either inhibit speculation, in which case the 'goodies' will cop it too, or it won't, in which case the nasty 'baddies' will continue to run amok. Again, which is to be?

And what would you suggest, might I ask? And how, furthermore, would this respect the National Sovereignty so beloved to you?

1. Encourage sound macroeconomic policies.

2. Work to avoid the creation of excessive debt, by reducing investor dependence on state bail-outs, and thus promoting responsible borrowing habits.

3. Regulate banking and other areas of financial transaction, with endorsements for prudential rules on forex trading and borrow/lending, and maximum transparency regarding financial and economic arrangements.

4. Disincentivising the acruement of short-term debt, instead favouring policies that limit the need for such, by preventing initial over-expenditure.

5. Education and openness on the state of economy and economic policies, to prevent purely speculative capital transactions.

6. An allowance for, yes, provisional taxation on capital transaction, preferably only for short periods, and in each case administered at the lowest preferable level, in order to combat specific fluctuations.

How that would translate into a proposal...not sure. Lots of urging, and the creation of an oversight committee - possible even an IMF-style institution - to regulate it. NatSov? Well, I'm being pretty vague. That's because the situations of concern are too localised to comment on in the abstract. Greater representation would be required.

We agree with the outlined statements made by the representative from gruenberg.
Except for No 4, which would help to cut investment both nationally and internationally.
And No 6 as this may lead to another scenario like this one, which is to be avoided.

We agree with the outlined statements made by the representative from gruenberg.
Except for No 4, which would help to cut investment both nationally and internationally.
And No 6 as this may lead to another scenario like this one, which is to be avoided.

Investment isn't some abstract good. Do the people who invested in famous failed Gruenberger corporation EnGron think there should have been more investment? No. Limiting short-term debt is, surprisingly, a good idea.

What is this scenario? The proposal they're suggesting is unrealistic; however, I accept there may be times when stemming harmful capital flow will be in short-term interest. Allowing for the possibility of preventing this doesn't seem so terrible. It is sweeping assumptions about the ability to legislate capital flow that are damaging, not the intention itself.

So how will this discourage irresponsible investment? It will either inhibit speculation, in which case the 'goodies' will cop it too, or it won't, in which case the nasty 'baddies' will continue to run amok. Again, which is to be?



1. Encourage sound macroeconomic policies.

2. Work to avoid the creation of excessive debt, by reducing investor dependence on state bail-outs, and thus promoting responsible borrowing habits.

3. Regulate banking and other areas of financial transaction, with endorsements for prudential rules on forex trading and borrow/lending, and maximum transparency regarding financial and economic arrangements.

4. Disincentivising the acruement of short-term debt, instead favouring policies that limit the need for such, by preventing initial over-expenditure.

5. Education and openness on the state of economy and economic policies, to prevent purely speculative capital transactions.

6. An allowance for, yes, provisional taxation on capital transaction, preferably only for short periods, and in each case administered at the lowest preferable level, in order to combat specific fluctuations.

How that would translate into a proposal...not sure. Lots of urging,

As you told me before, I was thinking you prefer proposal with balls, so i'm surprised

and the creation of an oversight committee - possible even an IMF-style institution - to regulate it. NatSov? Well, I'm being pretty vague. That's because the situations of concern are too localised to comment on in the abstract. Greater representation would be required.

Respectful of natsov as the #130 Global Food Distribution Act, maybe?

As you told me before, I was thinking you prefer proposal with balls, so i'm surprised

As am I impressed that you can leap to conclusions about a proposal before seeing its text. Nice skills. I would probably testiculate the proposal by establishing a UN resource for dissemination of information, to provide a non-gold reserve fund, to administer any international financial codes which were passed, and so on. And I do think some areas of financial transaction can be legislated on definitively. Furthermore, declaring a law, but leaving the precision of enforcement to more local bodies, is very different from merely making an ignorable suggestion.

Respectful of natsov as the #130 Global Food Distribution Act, maybe?

Not going to get into this (although I like that by making this statement, you're justifying my pettyness - ta) now, but as has been said GFDA was an international matter, and furthermore promoted the sovereign capacity to trade freely in an open market. It is also irrelevant to this proposal. And, furthermore? I don't care if GFDA was 'the anti-sovereign proposal to crush them all': new debate, new opinions. Even if this were a flip-flop - which it is not - it says far more about you that instead of rebutting criticisms of your proposal you resort to snide comments concerning past actions than it does about me.

As am I impressed that you can leap to conclusions about a proposal before seeing its text. Nice skills. I would probably testiculate the proposal by establishing a UN resource for dissemination of information, to provide a non-gold reserve fund, to administer any international financial codes which were passed, and so on. And I do think some areas of financial transaction can be legislated on definitively. Furthermore, declaring a law, but leaving the precision of enforcement to more local bodies, is very different from merely making an ignorable suggestion.



Not going to get into this (although I like that by making this statement, you're justifying my pettyness - ta) now, but as has been said GFDA was an international matter, and furthermore promoted the sovereign capacity to trade freely in an open market. It is also irrelevant to this proposal. And, furthermore? I don't care if GFDA was 'the anti-sovereign proposal to crush them all': new debate, new opinions. Even if this were a flip-flop - which it is not - it says far more about you that instead of rebutting criticisms of your proposal you resort to snide comments concerning past actions than it does about me.


Indeed

http://test256.free.fr/UN%20Cards/flipflop.jpg

As am I impressed that you can leap to conclusions about a proposal before seeing its text. Nice skills. I would probably testiculate the proposal by establishing a UN resource for dissemination of information, to provide a non-gold reserve fund, to administer any international financial codes which were passed, and so on. And I do think some areas of financial transaction can be legislated on definitively. Furthermore, declaring a law, but leaving the precision of enforcement to more local bodies, is very different from merely making an ignorable suggestion.



Not going to get into this (although I like that by making this statement, you're justifying my pettyness - ta) now, but as has been said GFDA was an international matter, and furthermore promoted the sovereign capacity to trade freely in an open market. It is also irrelevant to this proposal. And, furthermore? I don't care if GFDA was 'the anti-sovereign proposal to crush them all': new debate, new opinions. Even if this were a flip-flop - which it is not - it says far more about you that instead of rebutting criticisms of your proposal you resort to snide comments concerning past actions than it does about me.

If you want to create an IMF, i think it's a good idea, and LAE will probably support you
The GDFA proposal, LAE had fully supported it, had created the UNFTC, to manage trade disputes, and i think it's pretty good also

If you want to create an IMF, i think it's a good idea, and LAE will probably support you
The GDFA proposal, LAE had fully supported it, had created the UNFTC, to manage trade disputes, and i think it's pretty good also

You see, this is your problem. You're obsessed with ideas, and you ignore mechanics. You've just stated you'd 'probably support' an IMF, when I only fleetingly mentioned in the context of some general suggestions. For me, it is far too early to be commenting on the merit of my suggestions as a substantive proposal. Why don't you instead reread, and consider whether a) they would negate the necessity of a Tobin Tax, and if not show how/why not, and b) consider whether your proposal would deal with the problems the suggestions I posited solved.

You see, this is your problem. You're obsessed with ideas, and you ignore mechanics. You've just stated you'd 'probably support' an IMF, when I only fleetingly mentioned in the context of some general suggestions. For me, it is far too early to be commenting on the merit of my suggestions as a substantive proposal. Why don't you instead reread, and consider whether a) they would negate the necessity of a Tobin Tax, and if not show how/why not, and b) consider whether your proposal would deal with the problems the suggestions I posited solved.

Thanks for your answer
I just said probably, because it seems to me that most ideas you expressed suited me, so it's why i told you that this is an interesting topic for me, but as i don't read any draft it why i said probably, forgive me if i was not clear

Gruenberg, it's a game, it seems we both enjoy it, so yes i enjoy ideas, it's why i suppose we both are here instead of anothr forum

i would love to have much more roleplay, i had a great on last week with Kirisubo, with the "marriage" of Pazu-lenny and Midori; the problem for me is that the stranger bar is more difficult for me to understand, i hope to be able to understand most of it, even without being part, it's what i'm trying, but not easy for me.

I know it's a game. However, needlessly passing proposals takes the fun out of the game just as effectively as does shooting down proposal ideas. In a UN context, I consider the game to be writing resolutions which few, if any of us are ever going to have the chance to do in RL, and debating them. I find that fun. Hopefully, we have some laughs on the side - I considered my Global Sea Levels proposal fun, as with your Roller Coaster one - but primarily, the game is fun because we take it a little seriously. There's no point, otherwise. You cannot deflect criticism of your proposal with 'it's a game'. If you don't want to answer, fine. But I don't think that's playing especially fair.

And, I agree, I wish there were more RP, and I can also understand you might have difficulties with some of it. If I ever seem intolerant, then I do not mean to be so: I argue with your ideas, but I have no problem with your ability to express yourself. Your English is in any case far superior to my...well, anything, really.

OOC: theres always roleplaying going if you know where to look.

the strangers bar is a strange beast because its a cross between a gentlemans club and a place to do backroom deals. i like it although and its the only place that ambassadors can get peace to talk properly IC.

I like the challenge of playing a nation based on a mix of feudal and modern Japan. Its an even bigger challenge that being anti-un is :).

OOC: theres always roleplaying going if you know where to look.


You have a point darling ;), i suppose it's up to me to cook the dinner tonight:p

Before anyone complains about it, I'm pretty sure Rep in Tax is not a problem here. Rep in Tax is about national governments' ability to control what they tax on domestic goods. It doesn't stop UN taxes, nor does it stop UN control of national taxes on international trade goods (which is, I've always thought, what the Tobin Tax is about).

Apologies, but I do think Rep in Tax prevents this:

-2- MANDATES all members to decrease for an equivalent amount their others taxes, including but not limited to: income tax or value-added tax, in order to keep the same ratio of total taxation as a percentage of GDP, which they had prior to implementing the Tobin Tax outlined in this resolution.

Apologies to all the posters, as many will undoubtedly be wrongly accused, but I have read so much bad economics in this thread (from either side) that I don't have energy to start making a case.

So I will try arguments tomorrow, but for now, my position:
Tobin might be a RL reference.
The balanced part is irrelevant.
Although this has been (wrongly) used by many commies as a flag, it is not a communist/anti-globalisation/whatever measure at all.
I STRONGLY support the introduction of a Tobin tax.

So I will try arguments tomorrow, but for now, my position:
Tobin might be a RL reference.
The balanced part is irrelevant.
Although this has been (wrongly) used by many commies as a flag, it is not a communist/anti-globalisation/whatever measure at all.
I STRONGLY support the introduction of a Tobin tax.

I don't think Tobin would be a RL reference. I've seen Tobin proposals last 4 days in queue.

I think RiT probably does rule out -2-.

And, reprinted from UNOG, because I'm not satisfied with the answers I've got so far, and I sense you're about to demolish my initial objections:

1. I believe there are variously better ways of dealing with the problems this sets out to solve, or that those problems are not solvable, or that we should not be attempting to unduly meddle. (And I would be willing to back those up with a proposal.)

2. If all the world was in the UN, it'd be a different story. But they're not. Currency trade IRL is seriously big money - massive - both in terms of the amounts handled, and the salaries paid. I don't care how low you set it, they will jump ship, en masse. Having currency trade flood out of UN economies is undesirable to the extreme.

3. You've covered most options pretty well, but even then, that's not enough: what about liquid securities, for example? The fact is, the Tobin Tax would spread like wildfire, and engulf large sectors of the exclusively domestic capital market.

4. I don't think 0.1% would work. Simple as that. No one knows enough about NS economics to truly say, but we must assume some correlation to RL. If you don't set the tax reasonably high, then speculative attacks will not be deterred to the extent you're suggesting.

5. Stop using the "Well, we tax everything else..." argument. We don't, and anyway, that's a bullshit reason.

6. I don't really believe, to a partially IC extent, in currency destabilisation to the damaging extent you're implying. If buyers buy high, sell low, which they would need to do in order for destabilisation to take hold, then they would go out of business. Quickly.

7. There is no real way of distinguishing between a speculative trade and a desirable one.

8. I would again subscribe to a partially IC view that currency trade can be predicative. If traders are assured the government will not introduce some controls to stem capital flow, they will carry on trading, even in the point of an economic downturn, thus aiding the recovery. If they think the government will tighten controls, then they may sell out quickly, and actually further the recession.

9. There is much in the way of prudential regulation of banking that can be done to offset the risk of excessive dependence on state bail-outs.

10. If you rebut/ignore all of this, and carry on, then at least change -2-. I know what you're trying to do, and it's clever, but it doesn't really work. It might be better to use the tax to collect a fund, and use that to fund information/education programs on economic policy. (And may be illegal anyway.)

It's an agent of communist oppression, and it destroys the global economy.

I agree and we have a Knootian economist flying in to consider this proposal carefully and maul it to death, which is what it deserves. I also feel the Gruenberg questions are important ones.

~Aram Koopman, Knootian ambassador to the NSUN
"If the United Nations is a country unto itself, then the commodity it exports most is words."

http://home.ripway.com/2005-12/534911/NSO-member.PNGhttp://home.ripway.com/2005-12/534911/unog-member.PNGhttp://home.ripway.com/2005-12/534911/uma-member.PNGhttp://home.ripway.com/2005-12/534911/WIKI-member.PNG

Mostly OOC:

First, it is readily apparent that the UN cannot collect this tax directly (not that it has been suggested, but I'd like to point it out anyway). Resolution 4 prevents this in no uncertain terms.

Second, with regard to National Systems of Tax, I need to know whether foreign currency becomes "domesticated" when it enters another country. For example, would a sweater made in China still be considered Chinese even if it was imported to the United States and hanging on a sales rack in small-town Kansas?

If so, the Tobin Tax is at least legal. If not, the tax becomes more questionable - NSoT may prohibit the taxation of the "sale" of a "domestic" item. Intranational sales cannot be taxed due to NSoT, in other words.

Thus, we are forced to consider the fate of $[currency] when $[foreign national] buys something in Krioval, using $[currency]. Since there is no currency speculation, I can only assume that there is no tax applied (otherwise, every financial transaction would have to be targeted, as they all involve some form of money being "sold"). The Kriovalian merchant then deposits the $[currency] at the Bank of Krioval, with the bank automatically crediting his account. Does the tax apply at this step? What if he/she withdraws money in Kriovalian yen rather than $[currency]? Does the bank have to pay the tax when it allows $[foreign national] to withdraw $[currency] if that individual is a resident of Krioval?

Completely OOC (and off-topic):

Krioval is also changing to adopt the "feudal Japan/modern Japan" atmosphere, although we're actually spacefaring. I'm guessing that's rather common, though. [/hijack]

Apologies, but I do think Rep in Tax prevents this:

Thanks it's a good question
Rep in Tax doesn't prevent anything about "Income tax"
About VAT, i'm not sure, but i don't think either, as PC didn't sates it and as our proposal don't deal with "the determination of rate, general type (progressive, flat, etc.) and specific application"; it's just mandating a decrease
But, yes, as you i would prefer to check this before

The balanced part is irrelevant.

You can find the balanced part irrelevant, but we don't want to implement a "classical tobin tax", we propose a tobin tax of another type.

I STRONGLY support the introduction of a Tobin tax.

Thanks

The problem is not a problem: currency speculation is not bad

To quote The Guardian (effort to appeal to the progressive readers here) currency speculators are "an exceptionally useful lot, working day-in, day-out, risking their own wealth to supply a thing called liquidity. Without liquidity, markets dry up, prices become volatile and goods become difficult to shift." If a Tobin tax were in place, their editorial says, that useful work would not be as well accomplished. "The net result is that everyone involved — producer, trader, buyer — becomes poorer, not richer"

Simply put, there is a reason for international speculation. Now, you may have a problem with capital flight (Asia Crisis style) but capital speculation in itself is a very good thing indeed. This proposal would hurt international trade and global economic efficiency by the very margin it imposes. And even a very low percentage of the entire NSUN trade is a HUGE inefficiency. (And scare away capital, but I will get to that later.)

There is no need for this even insofar as it is a problem: Reducing short-term market volatility does not require a Tobin Tax
The issue at stake here is capital controls. If a nation wishes for more influence over capital controls of (especially) short-term capital to prevent capital flight in a panic (which IS a problem) then they can take measures to this end without a Tobin tax. Indeed, many nations have done so successfully for example by demanding that capital investment remain in the country for the minimum of a year. Such measures could be taken on the national or regional trade level perfectly well, without harming competitiveness. In fact, if these regulations are effective they would promote a more stable economic climate which is more attractive to investors.

Even if it was a problem, it should not be handled on the international level: Different economies have different needs.
The balance of having capital controls (or not) is deeply dependent on the economic circumstances of the nation involved. Small, developing nations will more likely benefit from limited capital controls (on the level of a “national Tobin tax” or other guarantees, for example) whilst large, developed nations would be hurt by such a tax. Large nations generally would not stand to benefit from capital controls. This is therefore NOT something that should be arranged in a single blanket resolution.

Anti-social: This proposal favours the rich!
I’d have to get my data, but the thing about this tax proposal is that will be collected by nations, not by the UN. This creates a huge crux – namely that of where the receipts will be going. A proposal which basically nationalises income would put more money in the pockets of rich, trading developed nations at the expense of poor nations. If one would care to know more I can look up some of the proof for you, but a national tax proposal would cause a massive poor-to-rich countries worldwide redistribution assuming both sides of the deal are being taxed. This is the primary argument for putting the money in a UN fund.

Indeed, this money is not put to international use as is the idea behind other Tobin Tax proposals, where money is being used as re-investment into economic development. This just puts the money back into the coffers of national governments, which makes it fairly pointless to do it on the international level in the first place.

However, to do it on the international level would make the UN a HUGE receiver of money, more powerful than many member states combined. It would also be in contravention of the Taxation Ban resolution. Therefore, this is infeasible.

EDIT: to just touch the issue of "why" (it is late and my books are downstairs) the tax receipts would go mostly to rich much-trading nations, (in terms of volume, even if they are less open and vulnerable!) whilst poorer developing nations would suffer because they trade mostly resources for not so much money at decreasing terms of trade. So they miss out on the phat l00t of this tax whilst STILL being subject to speculation because the volumes are so tiny. On the other hand the restrictions on big rich nations that trade much would be crippling even if their governments would get unimaginably large amounts of money from this tax.

Practical objection: collection is unimaginably expensive (and/or illegal)
Collecting this tax is *not* easy. It is unimaginably complicated, and creates immense bureaucracy. Contravention and fraud using third nations alone will be an issue. The problem of “counting double" on transactions is a serious one. The implementation would not be practically feasible on the level that, say, normal taxation is. (Taxation in itself is already very expensive.) This would therefore be in contravention of the principle that taxes should be levied in the most efficient way possible. Replacing a domestic VAT with an NSUN Tobin Tax would make the taxation system a *lot* less efficient.

Welfare objection: it would destroy your economies
The fact that only the NSUN is affected makes it not worldwide. Gruenberg rightly pointed out that this can and will lead to capital flight because there IS a place to flee to, contrary to a world-wide proposal.

In effect, this will work as a self-imposed negative tariff on the high end of the services industry which is very tradable, as well as other tradable sectors, at the expense of non-tradables. I cannot emphasise enough that even the smallest percentage of “everything” is “unimaginably fucking much”



OOC: My apologies for the RL-academia referencing semi-OOCish nature of this post. That is what you get when you propose a Tobin tax in NationStates. It is also 3:30 Am so this is subject to a little change because I am a bit brain-dead

*adds in a little edit on the why*

Mostly OOC:

First, it is readily apparent that the UN cannot collect this tax directly (not that it has been suggested, but I'd like to point it out anyway). Resolution 4 prevents this in no uncertain terms.

You right, we states it in our proposal, in clause [H]:
"it shall be noted that this tax will be collected by nations, not by the UN"

Second, with regard to National Systems of Tax, I need to know whether foreign currency becomes "domesticated" when it enters another country. For example, would a sweater made in China still be considered Chinese even if it was imported to the United States and hanging on a sales rack in small-town Kansas?

If so, the Tobin Tax is at least legal. If not, the tax becomes more questionable - NSoT may prohibit the taxation of the "sale" of a "domestic" item. Intranational sales cannot be taxed due to NSoT, in other words.

#105 National Systems of Tax, was repealed by its own authors, who passed then #128 Representation In Taxation
http://ns.goobergunch.net/wiki/index.php/Representation_In_Taxation?goobergunch1_session=05a06103a065e305dbfee42e8b50d4ad


Thus, we are forced to consider the fate of $[currency] when $[foreign national] buys something in Krioval, using $[currency]. Since there is no currency speculation, I can only assume that there is no tax applied (otherwise, every financial transaction would have to be targeted, as they all involve some form of money being "sold"). The Kriovalian merchant then deposits the $[currency] at the Bank of Krioval, with the bank automatically crediting his account. Does the tax apply at this step? What if he/she withdraws money in Kriovalian yen rather than $[currency]? Does the bank have to pay the tax when it allows $[foreign national] to withdraw $[currency] if that individual is a resident of Krioval?

YEN in Krioval, $ in LAE
(in fact the currency is the FUN in LAE but it will be simplier with $)
I'm on vacation in Krioval, i pay the marchant in $
The marchant depose some $ at the bank
If he don't have an bank account in $, then the bank will change for him into YEN, and he will pay the tax.

If instead I withdraw some YEN, if my bank account in LAE is in $ and not in YEN, my bank account will be debited by the tax

Hope to have answered, please let me know if my answer is not adequate

The Kingdom of Fourheart's commends the gentleman from the Knootian East Indies on a most excellent post.

The Kingdom of Fourhearts would also like to express it's disdain concerning the current proposal and states it's severe opposition of it.

The problem is not a problem: currency speculation is not bad

To quote The Guardian (effort to appeal to the progressive readers here) currency speculators are "an exceptionally useful lot, working day-in, day-out, risking their own wealth to supply a thing called liquidity. Without liquidity, markets dry up, prices become volatile and goods become difficult to shift." If a Tobin tax were in place, their editorial says, that useful work would not be as well accomplished. "The net result is that everyone involved — producer, trader, buyer — becomes poorer, not richer"

Simply put, there is a reason for international speculation. Now, you may have a problem with capital flight (Asia Crisis style) but capital speculation in itself is a very good thing indeed. This proposal would hurt international trade and global economic efficiency by the very margin it imposes. And even a very low percentage of the entire NSUN trade is a HUGE inefficiency. (And scare away capital, but I will get to that later.)

There is no need for this even insofar as it is a problem: Reducing short-term market volatility does not require a Tobin Tax
The issue at stake here is capital controls. If a nation wishes for more influence over capital controls of (especially) short-term capital to prevent capital flight in a panic (which IS a problem) then they can take measures to this end without a Tobin tax. Indeed, many nations have done so successfully for example by demanding that capital investment remain in the country for the minimum of a year. Such measures could be taken on the national or regional trade level perfectly well, without harming competitiveness. In fact, if these regulations are effective they would promote a more stable economic climate which is more attractive to investors.

Even if it was a problem, it should not be handled on the international level: Different economies have different needs.
The balance of having capital controls (or not) is deeply dependent on the economic circumstances of the nation involved. Small, developing nations will more likely benefit from limited capital controls (on the level of a “national Tobin tax” or other guarantees, for example) whilst large, developed nations would be hurt by such a tax. Large nations generally would not stand to benefit from capital controls. This is therefore NOT something that should be arranged in a single blanket resolution.

Anti-social: This proposal favours the rich!
I’d have to get my data, but the thing about this tax proposal is that will be collected by nations, not by the UN. This creates a huge crux – namely that of where the receipts will be going. A proposal which basically nationalises income would put more money in the pockets of rich, trading developed nations at the expense of poor nations. If one would care to know more I can look up some of the proof for you, but a national tax proposal would cause a massive poor-to-rich countries worldwide redistribution assuming both sides of the deal are being taxed. This is the primary argument for putting the money in a UN fund.

Indeed, this money is not put to international use as is the idea behind other Tobin Tax proposals, where money is being used as re-investment into economic development. This just puts the money back into the coffers of national governments, which makes it fairly pointless to do it on the international level in the first place.

However, to do it on the international level would make the UN a HUGE receiver of money, more powerful than many member states combined. It would also be in contravention of the Taxation Ban resolution. Therefore, this is infeasible.

EDIT: to just touch the issue of "why" (it is late and my books are downstairs) the tax receipts would go mostly to rich much-trading nations, (in terms of volume, even if they are less open and vulnerable!) whilst poorer developing nations would suffer because they trade mostly resources for not so much money at decreasing terms of trade. So they miss out on the phat l00t of this tax whilst STILL being subject to speculation because the volumes are so tiny. On the other hand the restrictions on big rich nations that trade much would be crippling even if their governments would get unimaginably large amounts of money from this tax.

Practical objection: collection is unimaginably expensive (and/or illegal)
Collecting this tax is *not* easy. It is unimaginably complicated, and creates immense bureaucracy. Contravention and fraud using third nations alone will be an issue. The problem of “counting double" on transactions is a serious one. The implementation would not be practically feasible on the level that, say, normal taxation is. (Taxation in itself is already very expensive.) This would therefore be in contravention of the principle that taxes should be levied in the most efficient way possible. Replacing a domestic VAT with an NSUN Tobin Tax would make the taxation system a *lot* less efficient.

Welfare objection: it would destroy your economies
The fact that only the NSUN is affected makes it not worldwide. Gruenberg rightly pointed out that this can and will lead to capital flight because there IS a place to flee to, contrary to a world-wide proposal.

In effect, this will work as a self-imposed negative tariff on the high end of the services industry which is very tradable, as well as other tradable sectors, at the expense of non-tradables. I cannot emphasise enough that even the smallest percentage of “everything” is “unimaginably fucking much”



OOC: My apologies for the RL-academia referencing semi-OOCish nature of this post. That is what you get when you propose a Tobin tax in NationStates. It is also 3:30 Am so this is subject to a little change because I am a bit brain-dead

By nature, Every tax has bad effects, what we need to compare is the bad effects of this tobin tax VS the good effect of the decrease of income tax or VAT in -2-.

Why Income tax should be worse than tax on currency transactions?
Why VAT should be worse than tax on currency transactions?

Your interesting article is dealing with a "classical tobin tax", this is not what most of your post is about.

About the collection, it will not b difficult, as most transaction already include some fees by banks, and as we propose the tax to be collected as VAT is collected, and VAT is easily collected worldwide.

-H- DEFINING for the purposes of this document the “Tobin Tax”, as the taxation, at the rate of 0.1%, of every financial transactions [sic] of currencies, or derivatives with one or several currency (ies) as the underlying(s), including but not limited to: futures, forwards, options and swaps - it shall be noted that this tax will be collected by nations, not by the UN, and that the easy manner to collect it [Sic], is similar to how Value-Added-tax is collected

-1- MANDATES all members to implement the “Tobin tax” as defined in [H].

-2- MANDATES all members to decrease for an equivalent amount their others [sic] taxes, including but not limited to: income tax or value-added tax, in order to keep the same ratio of total taxation as a percentage of GDP, which they had prior to implementing the Tobin Tax outlined in this resolution

OOC: I was lying in my bed muttering to myself about the stupidity of it all when I realised I had not actually touched this clause yet, besides the principled objections. That clause really insults peoples intelligence, I think. And not just because of my [SIC] additions.

The very notion that taxing international transations can be in any way similar to VAT tax collection is, well, a lie. It completely bypasses all the issues that make the Tobin Tax so very hard-to-unfeasible by just claiming it is easy. You can do better. Specify what exactly will be taxed, and how, and for whom.

Back to bed now.

By nature, Every tax has bad effects, what we need to compare is the bad effects of this tobin tax VS the good effect of the decrease of income tax or VAT in -2-.

Why Income tax should be worse than tax on currency transactions?
Why VAT should be worse than tax on currency transactions?

Your interesting article is dealing with a "classical tobin tax", this is not what our proposal is about.

I responded to YOUR idea with ALL the specific circumstances of the NS situation, dear. It is not about "classical" Tobin Tax but about YOUR proposal which only survives by being tragically unspecific.

And I do not understand your questions, linguistically. Please rephrase.

I responded to YOUR idea with ALL the specific circumstances of the NS situation, dear. It is not about "classical" Tobin Tax but about YOUR proposal which only survives by being tragically unspecific.

And I do not understand your questions, linguistically. Please rephrase.


My questions:
Why Income tax should be worse than tax on currency transactions?
Why VAT should be worse than tax on currency transactions?

That mean, for the same total ammount of taxes in a nation:
what is the best repartition?
Is it better to have it all in Income and VAT
or can it be better to have lower Income tax and lower VAT, while taxing currency transactions?

Indeed, this money is not put to international use as is the idea behind other Tobin Tax proposals, where money is being used as re-investment into economic development. This just puts the money back into the coffers of national governments, which makes it fairly pointless to do it on the international level in the first place.


Our proposal does't put the money back in coffers of national governments, but in taxpayers (Income tax) and consummers (VAT) pockets.

Furthermore if the estimeed Ambassadors of Knootian East Indies and Gruenberg think that it would be better not to have -2-, for their nation,

Then we can use "STRONGLY URGES" in -2-
Campadria and i, had a discussion about that when we drafted it off-forum, and we didn't like it to much that way.
Then i speak for myself, and I don't favour it, but I'm open to it an I will wait for Compadria thoughts about it

#105 National Systems of Tax, was repealed by its own authors, who passed then #128 Representation In Taxation

Correct. However, my statements were quoted from #128 - I gave the wrong source in my earlier post.

YEN in Krioval, $ in LAE
(in fact the currency is the FUN in LAE but it will be simplier with $)
I'm on vacation in Krioval, i pay the marchant in $
The marchant depose some $ at the bank
If he don't have an bank account in $, then the bank will change for him into YEN, and he will pay the tax.

If instead I withdraw some YEN, if my bank account in LAE is in $ and not in YEN, my bank account will be debited by the tax

Hope to have answered, please let me know if my answer is not adequate

What if the currency is never formally converted? Further, why would any merchant accept foreign currency if the result is to be taxed for trying to deposit earnings? I admit that the actual amount of tax may be considered low, but still, businesses don't like to lose money at all.

Also, in your second case, which country pockets the tax? I would argue that Krioval is unfairly penalized if LAE gets the money, since Kriovalian ¥ cannot be spent in other countries without the tax applying. Thus, it will eventually set up an environment where national governments will try to maximize returns on the Tobin Tax while (in capitalist societies) businesses will attempt to lower their shares. This will have a definite cooling effect on international trade, which is unfortunate, considering that its intent is to extend only to currency speculation.

Even if one finds currency speculation to be a matter for the UN to legislate (I do not), the method to solve the problem appears to create a bigger problem. Thus, I cannot support this.

高原由
クリオヴァル

Yoshi Takahara
Krioval

Well, insomnia gives me some time to answer a post here, so this one sounds interesting enough. I will be writing OOC and RL based.

The problem is not a problem: currency speculation is not bad

To quote The Guardian (effort to appeal to the progressive readers here) currency speculators are "an exceptionally useful lot, working day-in, day-out, risking their own wealth to supply a thing called liquidity. Without liquidity, markets dry up, prices become volatile and goods become difficult to shift." If a Tobin tax were in place, their editorial says, that useful work would not be as well accomplished. "The net result is that everyone involved — producer, trader, buyer — becomes poorer, not richer"

Hmm? Appeal to authority, you say? I find the use of a Guardian editorial to contest a Nobel-winning economist nothing short of an insult to the profession. Furthermore, the said economist developed a well grounded theory, with no obvious vested interest in it. This comment (which is direct plagiarism of Wikipedia btw, without a link to the source or to the original editorial), while presenting some correct arguments about the usefulness of speculators, completely ignores the other side of the argument, and I therefore dismiss it as biased and totally partisan.

Simply put, there is a reason for international speculation. Now, you may have a problem with capital flight (Asia Crisis style) but capital speculation in itself is a very good thing indeed.

Your lack of understanding for the causes and mechanism of currency crises is disheartening. Speculation is always an essential part of the propagation mechanism, and occasionally the main cause (cf Soros vs Bank of England).

This proposal would hurt international trade and global economic efficiency by the very margin it imposes. And even a very low percentage of the entire NSUN trade is a HUGE inefficiency. (And scare away capital, but I will get to that later.)

Interesting. I now have two options. I either call the inefficiency TINY, making it even, or I challenge you to present a quantifiable efficiency measure to support that statement. Say, a valid, unbiased economic study on the macroeconomic impact of a Tobin tax. As you present it, I would call it pointless rethoric.
I would also point out that, as you might know, the total tax revenue is not a measure of inefficiency - you would need to use something called "deadweight loss." Can't be bothered to elaborate.

There is no need for this even insofar as it is a problem: Reducing short-term market volatility does not require a Tobin Tax
The issue at stake here is capital controls. If a nation wishes for more influence over capital controls of (especially) short-term capital to prevent capital flight in a panic (which IS a problem) then they can take measures to this end without a Tobin tax. Indeed, many nations have done so successfully for example by demanding that capital investment remain in the country for the minimum of a year. Such measures could be taken on the national or regional trade level perfectly well, without harming competitiveness. In fact, if these regulations are effective they would promote a more stable economic climate which is more attractive to investors.

Blatant contradiction with your previous arguments, defending heavy capital controls against a (mild) tax.
The capital controls you defend are not something I would dismiss with from first principles. However, the effect on foreign investment of having capital stuck in a country for one year, irrespectively of stock market movements, is a lot stronger than that of a Tobin tax. This does not require heavy economics. Everyone can see that the stock market volatility can mean potential losses of 10% or 20% a year, quite frequently. Now compare that with an extremely heavy Tobin tax, where you lose 1% of your money investing, another 1% pulling out, but you have the right to withdraw your money any time. More frequently, this sort of system is implemented by taxing rather than prohibiting short term movements, making it less damaging to foreign investment.

Even if it was a problem, it should not be handled on the international level: Different economies have different needs.
The balance of having capital controls (or not) is deeply dependent on the economic circumstances of the nation involved. Small, developing nations will more likely benefit from limited capital controls (on the level of a “national Tobin tax” or other guarantees, for example) whilst large, developed nations would be hurt by such a tax. Large nations generally would not stand to benefit from capital controls. This is therefore NOT something that should be arranged in a single blanket resolution.

Quite the contrary, the only way a Tobin tax can be implemented is by international coordination. In fact, this is often pointed out as the single determinant factor for the impossibility of a Tobin tax in RL. National Tobin taxes are useless, they would just divert funds and trade to other nations. Some RL nations (Belgium, I think) have expressed their support for it, but made its introduction conditional on the approval in other nations (all EU countries, I think).

Anti-social: This proposal favours the rich!
I’d have to get my data, but the thing about this tax proposal is that will be collected by nations, not by the UN. This creates a huge crux – namely that of where the receipts will be going. A proposal which basically nationalises income would put more money in the pockets of rich, trading developed nations at the expense of poor nations. If one would care to know more I can look up some of the proof for you, but a national tax proposal would cause a massive poor-to-rich countries worldwide redistribution assuming both sides of the deal are being taxed. This is the primary argument for putting the money in a UN fund.

There has been indeed an argument to use the money for UN purposes, but it is irrelevant for the purposes of limiting speculation. Again, you are contradicting yourself, previously you claimed this only benefited smaller nations, now it only benefits large nations.

Anyway, I haven't read this particular proposal, but I grant you this point. If the money was retained in the country of transaction, there would be indeed a significant distortion. A fair method of distributing the funds should be designed (with our unique instrument of compulsory compliance). But remember, the reason rich nations are earning more is the same as why they earn more in income tax, VAT, or tariffs. There is little you can do about it.

Indeed, this money is not put to international use as is the idea behind other Tobin Tax proposals, where money is being used as re-investment into economic development. This just puts the money back into the coffers of national governments, which makes it fairly pointless to do it on the international level in the first place.

You are wrong. The original idea of the Tobin tax was independent of the application of funds. The economic development idea came later as a "nice" use for the money. In our NS world, I would rather see it funding a lender of last resort, to further minimise the possibility of currency crises. But I agree it is illegal, as in your point below.

However, to do it on the international level would make the UN a HUGE receiver of money, more powerful than many member states combined. It would also be in contravention of the Taxation Ban resolution. Therefore, this is infeasible.

Sure, depending on the %, which could be adjusted. I believe the real life FX markets move something in the order of trillions of USD a day, if I had the pacience to get a world GDP I could come up with a reasonable tax rate.

EDIT: to just touch the issue of "why" (it is late and my books are downstairs) the tax receipts would go mostly to rich much-trading nations, (in terms of volume, even if they are less open and vulnerable!) whilst poorer developing nations would suffer because they trade mostly resources for not so much money at decreasing terms of trade. So they miss out on the phat l00t of this tax whilst STILL being subject to speculation because the volumes are so tiny. On the other hand the restrictions on big rich nations that trade much would be crippling even if their governments would get unimaginably large amounts of money from this tax.

Speculation is reduced. It is not perfect, but it helps. Of course volumes can not be changed - the fact that they are tiny is the very reason the tax is needed, to reduce incentives to speculative attacks. Your claim about big nations is unfounded.

Practical objection: collection is unimaginably expensive (and/or illegal)
Collecting this tax is *not* easy. It is unimaginably complicated, and creates immense bureaucracy. Contravention and fraud using third nations alone will be an issue. The problem of “counting double" on transactions is a serious one. The implementation would not be practically feasible on the level that, say, normal taxation is. (Taxation in itself is already very expensive.) This would therefore be in contravention of the principle that taxes should be levied in the most efficient way possible. Replacing a domestic VAT with an NSUN Tobin Tax would make the taxation system a *lot* less efficient.

This is no harder to collect than an FX transaction fee. VAT is not comparable, and it is much harder to collect, albeit only a national issue.

Welfare objection: it would destroy your economies
The fact that only the NSUN is affected makes it not worldwide. Gruenberg rightly pointed out that this can and will lead to capital flight because there IS a place to flee to, contrary to a world-wide proposal.

Scaremongering. As I stated before, RL countries have expressed willingness to adopt this if a limited number of neighbours accepted. All you need is a critical mass for this to work.

In effect, this will work as a self-imposed negative tariff on the high end of the services industry which is very tradable, as well as other tradable sectors, at the expense of non-tradables. I cannot emphasise enough that even the smallest percentage of “everything” is “unimaginably fucking much”

Wrong. A small percentage of a lot (not everything is FX) can be adjusted to be as small as you want it. But anyway, this is not the trade-off one should look at when setting the tax.

OOC: My apologies for the RL-academia referencing semi-OOCish nature of this post. That is what you get when you propose a Tobin tax in NationStates. It is also 3:30 Am so this is subject to a little change because I am a bit brain-dead

Enjoyable. ;) Looking back, I regret accusing you of having unfounded arguments, because it is impossible to debate such a technical issue like this. However, I do think you are presenting a biased description of reality. Next time I feel like it, I will try to give a pros & cons view of the tax, to support my opinions (which, as yours, stand largely unfounded here).

Correct. However, my statements were quoted from #128 - I gave the wrong source in my earlier post.



What if the currency is never formally converted? Further, why would any merchant accept foreign currency if the result is to be taxed for trying to deposit earnings? I admit that the actual amount of tax may be considered low, but still, businesses don't like to lose money at all.

Also, in your second case, which country pockets the tax? I would argue that Krioval is unfairly penalized if LAE gets the money, since Kriovalian ¥ cannot be spent in other countries without the tax applying. Thus, it will eventually set up an environment where national governments will try to maximize returns on the Tobin Tax while (in capitalist societies) businesses will attempt to lower their shares. This will have a definite cooling effect on international trade, which is unfortunate, considering that its intent is to extend only to currency speculation.

Even if one finds currency speculation to be a matter for the UN to legislate (I do not), the method to solve the problem appears to create a bigger problem. Thus, I cannot support this.

高原由
クリオヴァル

Yoshi Takahara
Krioval
yes, this is a problem. not are you planing on creating a huge burocracy in each country, there is no fixed point at where the tax gets taken out. there are so many what ifs that make this so hard to implament this.

I think it would be unfair to all parties for me to try to answer Fonzoland's concerns, so I will leave that to Knootoss. However,

Looking back, I regret accusing you of having unfounded arguments, because it is impossible to debate such a technical issue like this. However, I do think you are presenting a biased description of reality. Next time I feel like it, I will try to give a pros & cons view of the tax, to support my opinions (which, as yours, stand largely unfounded here).

I'd agree here. We are debating a theoretical issue, and we can demand evidence from both sides, but as far as I'm aware, there's a dirth of practical studies to talk about. I'd also point out that we were presenting one side of it: that's not an argument in itself. And, also this is a weakish argument in itself, I'll just throw it along anyway: if we are reacting like this, consider how the forex traders might.

Correct. However, my statements were quoted from #128 - I gave the wrong source in my earlier post.

Ok no pb, here is the answer i gave to the same question earlier:

Thanks it's a good question
Rep in Tax doesn't prevent anything about "Income tax"
About VAT, i'm not sure, but i don't think either, as PC didn't sates it and as our proposal don't deal with "the determination of rate, general type (progressive, flat, etc.) and specific application"; it's just mandating a decrease
But, yes, as you i would prefer to check this before



What if the currency is never formally converted?

Not sure to understand what you mean, sorry

A currency can be converted phisically (notes and cheque), or in a dematerialized way; both will be subject to the tax

Not sure to have answered your question

Further, why would any merchant accept foreign currency if the result is to be taxed for trying to deposit earnings? I admit that the actual amount of tax may be considered low, but still, businesses don't like to lose money at all.

Yes, it's low 0.1%
The merchant, will do what he want, if someone want to pay him in a foreign currency, he can accept or ask the client to change before, it's up to him, as nowadays.
Furthermore, tax tobin or notn the merchant will have to pay a fee or a comission for changing the foreign currency at the bank. And i will bet that this fe or comission will be > 0.1%


And nations can decides -2-, to be mainly or even only a VAT decrease, it will be their choice

Also, in your second case, which country pockets the tax? I would argue that Krioval is unfairly penalized if LAE gets the money, since Kriovalian ¥ cannot be spent in other countries without the tax applying.
Thus, it will eventually set up an environment where national governments will try to maximize returns on the Tobin Tax while (in capitalist societies) businesses will attempt to lower their shares.

This will have a definite cooling effect on international trade, which is unfortunate, considering that its intent is to extend only to currency speculation.


This can be said to every taxes, this is why our proposition is very cerefull not to increase the total ammount of taxes in any nations.
Our proposition is a small sort of redistribution of total ammount of taxes, from Income and selling of goods and service to currency transactions.

And in comparaison, we should aks ourselves why, it's more important not to tax currency transactions, than to tax the selling of goods and service, or income

And in comparaison, we should aks ourselves why, it's more important not to tax currency transactions, than to tax the selling of goods and service, or income

THERE ARE COUNTRIES IN THE UN WHO DO NOT HAVE AN INCOME TAX.

Do you not understand this? If not, I'll try to rephrase. But you have to try to see that taxation is not standardised. I have a regressive system; I believe you have a progressive one. You doubtless assess duties on certain products which I do not, and vice versa. In any case, the idea that we should tax something simply because we haven't already done so is ludicrous. And as for 'asking ourselves why', well, Knoot did ask you why. You still haven't responded. (I've given up hope of any of my questions being addressed, so we'll just concentrate on his.)

THERE ARE COUNTRIES IN THE UN WHO DO NOT HAVE AN INCOME TAX.

Do you not understand this? If not, I'll try to rephrase. But you have to try to see that taxation is not standardised. I have a regressive system; I believe you have a progressive one. You doubtless assess duties on certain products which I do not, and vice versa. In any case, the idea that we should tax something simply because we haven't already done so is ludicrous. And as for 'asking ourselves why', well, Knoot did ask you why. You still haven't responded. (I've given up hope of any of my questions being addressed, so we'll just concentrate on his.)


thanks, but our proposition stats in -2-:
"including but not limited to: income tax or value-added tax"
And as this is the draft we can add some others examples to VAT and income

And, also this is a weakish argument in itself, I'll just throw it along anyway: if we are reacting like this, consider how the forex traders might.

Dunno, they might start lobbying major newspapers to publish editorials? ;)

thanks, but our proposition stats in -2-:
"including but not limited to: income tax or value-added tax"
And as this is the draft we can add some others examples to VAT and income

Thunk. Thunk. Thunk. Thunk.

Ok, I'll try this a different way:

you said: "And in comparaison, we should aks ourselves why, it's more important not to tax currency transactions, than to tax the selling of goods and service, or income"
however, some nations do not tax selling of goods and service, or income
==> why force them to tax currency trade?

In response to Love and esterel
Your proposal is the institution of a a tax. A global tax, no less, which has a claim of improving how the economy works. In fact, that is the purpose, isn’t it? You shouldn’t be defending the proposal if this tax in fact does the opposite. Just saying that "other taxes have bad side-effects too" as you do simply doesn’t cut it when I’ve given you a plethora of reasons why this tax is WORSE. Fonzoland has tried to actually respond to them, so…

In response to Fonzoland
Quoting the Guardian as quoted by someone else is not, in my opinion, an appeal to authority but rather a matter of "hey, these people put it much more eloquently than I could and in English too" (English is not my first language even if my ‘minor’ subjects are on Political Economy and globalisation.) The fact of the matter is that they are right. I’d like to further point out that economics, as a profession, does not support the Tobin Tax so it is hardly an insult to the profession rather but an effort to make things understandable to the reader.

The fact of the matter is that curbing currency speculation lies at the heart of this proposal, and currency speculation in turn lies at the heart of international capital exchange in the modern economy. The resolution claims that exchange rates should ‘reflect’ Relative Purchasing Power Parity. This ignores how exchanges actually work, because through currency exchange they help shape capital flows which then influences PPP. The economy is not static, rather speculation is about much-needed flows.

The wording of –C- and –D- would seem to imply that this resolution is only about having capital controls because you need ‘smooth’ exchanges and ‘wild speculation’ is bad. So I put it to the authors: is this resolution merely about preventing capital flight, or are you genuinely opposed to the idea of untaxed currency speculation in general (as L&E appears to be at least). This really needs clarification.

To get back to Fonzolands accusation that I’ve displayed a lack of understanding with regards to the causes and mechanism of currency crises – no, I do recognise the role of speculation in such matters. A complete lack of capital controls combined with rampant currency and investment speculation is a ‘problem’. In fact, whilst supporting Free Trade I have problems with extreme capital market liberalisation as a blanket recipe for everyone. The ‘problem’ in my opinion is not capital speculation in general but the ‘panic effect’ which (IRL at least) is worsened by the problem that banks and countries feel they will always have a lender of last resort. This resolution tax will hamper normal capital speculation (because of a constant but small tax) but it will certainly not prevent capital flight. If you think you risk losing 85% of your investment value (happened in the East Asia crisis) then a 0.1% tax will NOT stop you from following the herd and selling, selling, selling and everyone is just as fucked in the end.

Unfortunately, I do not have a valid, unbiased economic study on the macroeconomic impact of this particular modified Tobin tax resolution on the economies of NationStates Nations ready. I hope you shall forgive me. At least I try (like you do, but unlike some others) to at least formulate an opinion of this resolution on the basis of economic reasoning and empirical examples.

Although you are right about "deadweight loss", I merely meant to illustrate last night that the higher your tax revenue/level the more inefficiency there will be in economic terms because currency speculation is distorted.

The very issue with this tax is that it is not ‘mild’ at all. That is a qualification which I would not use for a global Tobin tax on all currency transactions, futures, forwards, options and swaps. (Not that it is explained how this happens… but still) A short term movement prohibition would be heavy-handed I agree (and I would not dream of implementing it in Knootoss) but the issue remains that governments are perfectly capable of taking measures against capital flight on their own, without the huge disadvantages of this resolution.

You say that ‘the only way a Tobin tax can be implemented is by international coordination’ but that ignores my objection that a Tobin tax would be good for some countries but very bad for others, and that it would be good for some sectors of the economy but very, very bad for others.. This is why it isn’t being implemented.

I separate two things: capital controls would generally be more beneficial for developing and smaller (in short, vulnerable) nations. However the revenue (and economic distortion!) of the proposed tax would fall mostly with rich, big, trading countries and disproportionately so if you tax both sides of the transaction equally. (And as this resolution has assumed away implementation completely it is hard to say anything intelligent about that.) However, we seem to agree on this to begin with.

With regards to the use of funds, yes, the idea of using it internationally came later. Hence I referred to it as ‘other’ Tobin Tax proposals which do use these fund internationally. It is illegal to do that in the NSUN without repealing the taxation ban, which rules out ‘useful’ purposes such as using it to fund a lender of last resort as you proposed. Just giving it to the governments involved makes it fairly pointless and an inefficient way of taxation compared to national tax.

I do not believe that you could work out a reasonable tax rate using World GDP because World GDP figures are notoriously unreliable. Things are counted double; statistics are unclear for many nations, etc etc. Being able to implement this tax fairly assumes a level of information that only exists within national economies. Also, different countries would have different preferred capital controls and thus different measures. In a simplistic scheme like this, it is impossible to distinguish between desirable and undesirable exchange so the tax would introduce distortions and increase the cost of normal international financial transactions. This could kill off some valuable market segments completely.

*I* did not compare this tax (including tax on futures etc!) to "simply levying the VAT", the resolution does that! The welfare objections are not scaremongering. There are tangible enforcement problems because of tax evasion: agents will try to shift operations to other instruments, other territories or through other intermediaries that are not in the tax base in order to evade the tax burden. It would require world-wide, universal application, including current 'tax haven' territories, and that is not going to happen. This tax would need to include (and pretends to include) derivative exchange rate transactions, such as forwards, futures, swaps and options. However, assets other than currencies might also be considered as alternatives and taxing that will be a nightmare. This resolution does not tell us which intermediaries should be taxed, what is exempt, or how the tax on these other things is levied so either you create a gigantic loophole or you start a never-ending rat race of taxing things to prevent evasion.

I'd agree here. We are debating a theoretical issue, and we can demand evidence from both sides, but as far as I'm aware, there's a dirth of practical studies to talk about. I'd also point out that we were presenting one side of it: that's not an argument in itself. And, also this is a weakish argument in itself, I'll just throw it along anyway: if we are reacting like this, consider how the forex traders might.

Aye. You are only presenting the advantages and dismissing the problems. A pro/con thing as you mentioned would be nice. We could do the same, really.

Respectful of natsov as the #130 Global Food Distribution Act, maybe?
Well, yeah, that would be a start. At least #130 forced the base minimum of legislation (it only "enforced" a few clauses, very basic ones), and left nations a lot of lee-way in other areas. And besides that, Yelda was pretty open in drafting the proposal, and had, I believe, 3 different threads going to discuss the proposal way before submission, changing the proposal text a whole-frickin-lot. It's as much about the means as it is the ends.

OK, first of all, I did not read the proposal in great care. I know I don't agree with the balanced stuff (it is an illegal and ineffective breach of sovereignity), so my arguments were on the concept of a Tobin tax in general.

Second, I would even say I did NOT present the advantages at all, merely argued against the disadvantages. Limited time and pacience. Also, to be frank, I don't think most of the audience is that interested in economic theory.

Third, it is obvious that there are many people, much better informed than all of us here, both in favour and against the idea. The merits and faults with the approach are a technical debate, not suitable for simplistic approaches.

Having said that, at some point later I will try to present a description of the issues involved, trying to a reasonable extent to separate fact from opinion.

We reserve the right to set our own taxation policies, thank you.

Just saying that "other taxes have bad side-effects too" as you do simply doesn’t cut it when I’ve given you a plethora of reasons why this tax is WORSE. Fonzoland has tried to actually respond to them, so…

Knootos, you answer me about the side effect of the tobin tax, thanks, but you didn't compare it to the side effects of "Income tax" or VAT.

Income tax, put a direct curb on employment and consumption

VAT, by putting a curb on consumption, is also more directed as low income, as people with low income consume more, in % of their income

In response to Fonzoland
Quoting the Guardian as quoted by someone else is not, in my opinion, an appeal to authority but rather a matter of "hey, these people put it much more eloquently than I could and in English too" (English is not my first language even if my ‘minor’ subjects are on Political Economy and globalisation.) The fact of the matter is that they are right. I’d like to further point out that economics, as a profession, does not support the Tobin Tax so it is hardly an insult to the profession rather but an effort to make things understandable to the reader.

Sorry, this is wrong, some economists don't support it, some support it.

James Tobin got a Nobel price.
Even some of the most famous traders from all times as Georges Soros favour the Tobin tax.

And once again our proposal is a balanced tobin tax, not a classical one.

The fact of the matter is that curbing currency speculation lies at the heart of this proposal, and currency speculation in turn lies at the heart of international capital exchange in the modern economy. The resolution claims that exchange rates should ‘reflect’ Relative Purchasing Power Parity. This ignores how exchanges actually work, because through currency exchange they help shape capital flows which then influences PPP. The economy is not static, rather speculation is about much-needed flows.

The wording of –C- and –D- would seem to imply that this resolution is only about having capital controls because you need ‘smooth’ exchanges and ‘wild speculation’ is bad. So I put it to the authors: is this resolution merely about preventing capital flight, or are you genuinely opposed to the idea of untaxed currency speculation in general (as L&E appears to be at least). This really needs clarification.

If you look at many exchange rate history, it's obvious that may times the market doesn't reflect the reality, for exemple let's look at the variation of €/$.

Our proposition doesn't prevent the market decides of the exchange rate, and it states in -E-:
"while encouraging free-floating or pegged floating rates""

There are 2 objective, to decrease others tax in order to find something more sensible, and regulate variations of exchange rate not based on fundamantals.

The problem with this - well, one of many - is that Krioval does not have the equivalent of the "value added tax". Yes, our tax rate is high. But there is no Kriovalian sales tax of any kind, and our tariffs are almost nonexistent. We do not like to tax trade. What we do tax are income and owned land. We have good reasons for our choices.

Therefore, it is not a simple matter of raising one tax and lowering another. Even if it were, that does not make the new tax somehow better than its replacement. By comparing income tax to a form of sales tax, the implication is that the two are somehow linked by more than their being a way to add to the government treasury.

~ 高原 (Takahara)

THERE ARE COUNTRIES IN THE UN WHO DO NOT HAVE AN INCOME TAX.

This includes the Sultanate of Cluichstan.

=========================

http://www.nationstates.net/images/flags/uploads/cluichstan.jpg



Communique from the Cluichstani Foreign Ministry:

Like our Gruenberger friends, we are appalled by the gross arrogance being exhibited by certain UN representatives who feel they have the authority -- or, even worse, the right -- to impose a tax of any kind on our people. Should this proposal ever reach the floor of the UN, I will personally preside over Cluichstan's UN seat and campaign with every fiber of my being against its passage.

Respectfully,
Foreign Minister Sheik Retep bin Cluich

OOC response, since I don't have a hope of articulating my thoughts as if from the point of view of someone who ought to know what they're talking about. I'm rather fond of Ms Yefremova, so I'd rather not tarnish her reputation.

First, what exactly is the difference between the 'balanced' and 'classical' Tobin taxes, in layman's terms?

Second, NS=/=RL - as pointed out by others, conditions are vastly different here and possibly irreconcilable.

Third, variation of other taxes is problematic for nations that, say, do not operate centralised tax systems.

Fourth, this should not be a Political Stability proposal. I contend that it falls under Social Justice - any chance of a mod verdict?

Fifth, I have a feeling this is never going to be comprehensible enough for me to do anything other than abstain. Sorry.

The problem with this - well, one of many - is that Krioval does not have the equivalent of the "value added tax". Yes, our tax rate is high. But there is no Kriovalian sales tax of any kind, and our tariffs are almost nonexistent. We do not like to tax trade. What we do tax are income and owned land. We have good reasons for our choices.


The clause -2- of our proposal will decrease, if passed, income tax in nations without VAT, as Krioval

Originally Posted by Gruenberg
THERE ARE COUNTRIES IN THE UN WHO DO NOT HAVE AN INCOME TAX.

This includes the Sultanate of Cluichstan.



and will decrease, if passed, VAT in nation without income tax as Cluichstan


And yes our proposal will do nothing in non UN-nations, as Gruenberg.

First, what exactly is the difference between the 'balanced' and 'classical' Tobin taxes, in layman's terms?


Thanks for asking
The difference is that:
-a classical tobin tax increase the total ammount of taxes
-a balanced tobin tax, as in our proposal, doesn't increase the total ammount of taxes, by decreasing in the same time VAT income tax or others

The clause -2- of our proposal will decrease, if passed, income tax in nations without VAT, as Krioval

Illegal. "Representation in Taxation" says that:

2.DECLARES and PROTECTS, as inviolable rights of nations:

(a) imposing or not imposing of taxes or fees on domestic activities, items, and businesses within their national boundaries, and

(b) the determination of rate, general type (progressive, flat, etc.) and specific application of such taxes (who/what is and is not taxed);

In fact, as Krioval would want to not impose the Tobin Tax, it appears that Krioval has the inviolable right to not have to do so.

Maybe it's time for an official moderator ruling on the legality of this proposal.

Krioval, I disagree. The activities protected by RiT are exclusively intranational ones. The moment they cross borders - as currency trade does - they are not inviolably protected. I object to this proposal, but I don't think it's illegal for that (although I think requiring internal tax change possibly is).

Illegal. "Representation in Taxation" says that:



In fact, clause -2- let nations the choice about which tax they prefer to decrease:

"including but not limited to: income tax or value-added tax"

OOC: I still think that forcing a nation to reduce other taxes is, at best, questionably legal. Yet it may fly given the current rules. Fact is, I don't know, and I don't make those judgment calls 'round here.

OOC: I still think that forcing a nation to reduce other taxes is, at best, questionably legal. Yet it may fly given the current rules. Fact is, I don't know, and I don't make those judgment calls 'round here.


Yes, we are thinking it's legal, and ok with RiT

If not we will then not have the choice and use "strongly urges" but, for us the ratio "total taxes/GDP" is really important, we don't want UN members to increase this ratio

Yes, we are thinking it's legal, and ok with RiT

If not we will then not have the choice and use "strongly urges" but, for us the ratio "total taxes/GDP" is really important, we don't want UN members to increase this ratio

What ratio? What is 'total taxes'? Are you honestly suggesting that you are able to predict the tax burden of a balanced Tobin Tax, because you know precisely the effect it'll have on the currency market? If so, then I wouldn't waste your time on NS: while you're becoming the most successful currency speculator in history, you could probably pick up a couple of Nobels. I do not believe you can calculate the effect this will have, and as such you do not know what the tax burden is. Suggesting then that you can compare a ratio is nonsense.

What ratio? What is 'total taxes'? Are you honestly suggesting that you are able to predict the tax burden of a balanced Tobin Tax, because you know precisely the effect it'll have on the currency market? If so, then I wouldn't waste your time on NS: while you're becoming the most successful currency speculator in history, you could probably pick up a couple of Nobels. I do not believe you can calculate the effect this will have, and as such you do not know what the tax burden is. Suggesting then that you can compare a ratio is nonsense.

The ratio is just the sum of taxes divided by gdp, nothing special.
Every tax can be estimated relating to what is taxed, it's not an exact science of course, but in that case the margin of error, will not be very important, and can be easily reajusted.

The ratio is just the sum of taxes divided by gdp, nothing special.
Every tax can be estimated relating to what is taxed, it's not an exact science of course, but in that case the margin of error, will not be very important, and can be easily reajusted.

'the sum of taxes'? Look, if you levy a Tobin Tax, currency trade will decrease significantly. However, we don't by how much. As such, we can't calculate the amount of revenue which will be brought in. Do you follow?

'the sum of taxes'? Look, if you levy a Tobin Tax, currency trade will decrease significantly. However, we don't by how much. As such, we can't calculate the amount of revenue which will be brought in. Do you follow?

Currency trade will not decrease significantly, as the rate is 0.1%
This can be first estimated, re-estimatd after few months and then adjusted, these are justs stats.

Apologies, but I do think Rep in Tax prevents this:
Well Harumph! How dare you catch me in not reading the proposal before making my standard obtuse and unhelpful statements! Consider yourself puddinged...
http://photos1.blogger.com/img/103/1570/1024/chpd.jpg

Yum!

Currency trade will not decrease significantly, as the rate is 0.1%
This can be first estimated, re-estimatd after few months and then adjusted, these are justs stats.

The rate is high enough that currency trade will relocate outside the UN. It will decrease.

And, who's doing this reestimation? Your proposal doesn't allow for this. The clause 2 makes no sense, whatsoever. Find a better way to deal with the tax surplus.

EDIT: PC, when that image flashed up...I thought it was something very, very different.

EDIT: PC, when that image flashed up...I thought it was something very, very different.
Hmm...I'd better change that to a link...;)

The rate is high enough that currency trade will relocate outside the UN. It will decrease.

And, who's doing this reestimation? Your proposal doesn't allow for this. The clause 2 makes no sense, whatsoever. Find a better way to deal with the tax surplus.

EDIT: PC, when that image flashed up...I thought it was something very, very different.

Maybe we can add to clause -2-, that estimation will be corrected by adjustement, but i was thinking iy was implyed.

Yes clause -2- make sense, VAT and income tax decrease makes senses for many, thanks.

http://photos1.blogger.com/img/103/1570/1024/chpd.jpg

Yum!

the link doesn't work:(

Here's my read on it (personal views of the concept aside, of course).

(a) imposing or not imposing of taxes or fees on domestic activities, items, and businesses within their national boundaries, andThis limit on UN power is completely internal. As such, any potential taxes levied by the UN can only apply to international transactions. In this case, we're doing okay.

(b) the determination of rate, general type (progressive, flat, etc.) and specific application of such taxes (who/what is and is not taxed);This is where the problem comes in. Forcing nations to adjust their internal tax rates, even if it's lowering them, you are violating the standing Resolution. As long as RiT is still around, no Proposal can alter internal tax rates. Forcing nations to lower their taxes (income, luxury, VAT, whatever) to keep the "total tax"* the same is an illegal contradiction of and existing Resolution. "URGES", "REQUESTS", "SUGGESTS" or whatever would be acceptable.

- The Most Glorious Hack
Wearin' the Mod Hat

*
Non-Moddy comment:

The concept of "total tax" and adjusting other rates in a zero-sum game strikes me as highly dubious.

Here's my read on it (personal views of the concept aside, of course).

This limit on UN power is completely internal. As such, any potential taxes levied by the UN can only apply to international transactions. In this case, we're doing okay.

This is where the problem comes in. Forcing nations to adjust their internal tax rates, even if it's lowering them, you are violating the standing Resolution. As long as RiT is still around, no Proposal can alter internal tax rates. Forcing nations to lower their taxes (income, luxury, VAT, whatever) to keep the "total tax"* the same is an illegal contradiction of and existing Resolution. "URGES", "REQUESTS", "SUGGESTS" or whatever would be acceptable.


Ok thanks for your answer
Ok about VAT
But i would like to reopen the debate about "income tax", as Powerhungry Chipmunks stated about Representation In Taxation:


Also, and this is in response to your PPS, I don't believe my proposal specifically deals with income taxes. I mean the only areas of taxations it *must* cover are those areas covered in Clause #3 (I wrote Clauses #2 and #3 so as to leave areas of taxation not in #3 up to future decision by the UN). As I haven't included income taxes as a part of the initial definition of domestic taxes (unless I'm just totally missing where I wrote about income taxes), I don't think it's covered.


http://forums.jolt.co.uk/showpost.php?p=9708310&postcount=30

With all due respect to the UN's resident rodent, his intentions are irrelevent.

Your Proposal affecting income tax runs into two walls. First, you can't force the adjustment of income tax because it would be a Mechanics violation. Second, even if Chipmunks didn't intent for his Resolution to protect income tax, it still does. The rates and styles of internal taxation -- of which income tax is a part of -- are protected by RiT.

With all due respect to the UN's resident rodent, his intentions are irrelevent.

Your Proposal affecting income tax runs into two walls. First, you can't force the adjustment of income tax because it would be a Mechanics violation. Second, even if Chipmunks didn't intent for his Resolution to protect income tax, it still does. The rates and styles of internal taxation -- of which income tax is a part of -- are protected by RiT.


Ok, thanks for the clarification, so we will not use "mandates"or another forcing verb, in clause -2-

*snip*
and will decrease, if passed, VAT in nation without income tax as Cluichstan
*snip*


You have the gall and the arrogance to presume that you can order the Cluichstani government to decrease its taxes?

You have the gall and the arrogance to presume that you can order the Cluichstani government to decrease its taxes?

Now, your nation, if passed, will be strongly urged

Second, even if Chipmunks didn't intent for his Resolution to protect income tax, it still does. The rates and styles of internal taxation -- of which income tax is a part of -- are protected by RiT.Well, to re-offer my two cents, RiT (I believe) only permanently protects tax items in the definition of "domestic items activities and businesses". Everything not specifically defined as protected in that clause should (I think) operate like the UNSA: you can declare it "not a domestic tax" and resolve upon it in future legislation.

That said, I still haven't really read the proposal text to see if that means this could bypass RiT.

There are two signifigant effects from this 'tax'



The need to do quarterly or perhaps monthly national budgets. Which will increase nations spending....
Shortfalls if trading is slow due to recession or bad market conditions


Also why do you assume that my nation 'needs' another tax? We don't have an income tax for a reason.

If a nation is in recession/depression perhaps it needs to look internally to fix it's problems and not start blaming others for it's problems.

Also Mandating I add a new tax, that's like mandating that I have an income tax, not going to happen.... Do not let this even get a vote folks....

There are two signifigant effects from this 'tax'



The need to do quarterly or perhaps monthly national budgets. Which will increase nations spending....
Shortfalls if trading is slow due to recession or bad market conditions


Also why do you assume that my nation 'needs' another tax? We don't have an income tax for a reason.

If a nation is in recession/depression perhaps it needs to look internally to fix it's problems and not start blaming others for it's problems.

Also Mandating I add a new tax, that's like mandating that I have an income tax, not going to happen.... Do not let this even get a vote folks....

In the new age of international relations and trade, for the nations of the U.N., harmonisation of some aspects of trade policy is normal and desirable. The recessions and depressions of our economic cycles are nearly always due to external factors and far from 'blaming others' it should be a common policy to analyse how nations can co-operate to alleviate each other's fiscal woes.

May the blessings of our otters be upon you.

Leonard Otterby
Ambassador for the Republic of Compadria to the U.N.

Well, to re-offer my two cents, RiT (I believe) only permanently protects tax items in the definition of "domestic items activities and businesses". Everything not specifically defined as protected in that clause should (I think) operate like the UNSA: you can declare it "not a domestic tax" and resolve upon it in future legislation.

That said, I still haven't really read the proposal text to see if that means this could bypass RiT.

As I understood The Most Glorious Hack, even without RiT, "mandates" in -2- would not have been posssible for Mechanics violation.

Does the fact that "income tax" is included in your RiT, even if it was not intended by you change anything for you?

I can't see all the previous pasges of this thread (Blasted filters in the computer-system at work!), but has anybody explained yet where the term "Tobin" comes from in this context? If it's the name of somebody who drafted such a proposal in the 'Real "World' would that in itself be enough of a RW reference to make this proposal illegal here?

It is James Tobin, a RL economist. That said, I've seen Tobin Tax proposals last four days (and not reach quorum, but nor be deleted). I personally don't think it's illegal, and I think calling it the Bob Tax, after noted Gruenberger economist Bob, would be more likely to be illegal. So, I don't think it's a problem. It's only really a technical term. I wouldn't say it was illegal. Just a bad idea.

Hmm... that's one of those gray areas. Strictly speaking, it would be a violation of the Real World rules, but then, so would mentions of fines in the demoniation of the USD. Might be better to phrase it as "International Exchange Tax" or something like that, but if the only thing wrong with it is the mention of Tobin, I'd likely let it slide, just like I'd probably let an otherwise fine Proposal that mandates the use of Wankle engines, even while "rotary" would be better, or why using Nobel's name in the creation of a Nobel Prize would be okay. The name is more attached to the object it's describing, as opposed to the person it's named for.

With all due respect to the UN's resident rodent, his intentions are irrelevent.

Your Proposal affecting income tax runs into two walls. First, you can't force the adjustment of income tax because it would be a Mechanics violation. Second, even if Chipmunks didn't intent for his Resolution to protect income tax, it still does. The rates and styles of internal taxation -- of which income tax is a part of -- are protected by RiT.

The people of Cluichstan concur. Even though the intent of RiT may not have been to protect income tax, it still has that effect.

Respectfully,
Sheik Nadnerb bin Cluich
Cluichstani Ambassador to the UN
Regional Delegate from Scybala

Hmm... that's one of those gray areas. Strictly speaking, it would be a violation of the Real World rules, but then, so would mentions of fines in the demoniation of the USD. Might be better to phrase it as "International Exchange Tax" or something like that, but if the only thing wrong with it is the mention of Tobin, I'd likely let it slide, just like I'd probably let an otherwise fine Proposal that mandates the use of Wankle engines, even while "rotary" would be better, or why using Nobel's name in the creation of a Nobel Prize would be okay. The name is more attached to the object it's describing, as opposed to the person it's named for.


Indeed, it seems to me that the term "tobin tax" is a often used as a concept in economy. That say, if it's not Ok to use it, we will change the name of our proposal.

As I understood The Most Glorious Hack, even without RiT, "mandates" in -2- would not have been posssible for Mechanics violation.
Okay, so how RiT is interpreted further is a bit of a moot point? Great! :)

Does the fact that "income tax" is included in your RiT, even if it was not intended by you change anything for you?Well, I agree that it might be included in the "including fbut not limited to part" (as one of the "not limited to" things), but I, a little bit, disagree that there is permanent protection on income taxes in my proposal. Of course, there doesn't need to be protection of income taxes and it's really not a debatable point (as no proposal can affect income taxes due to ame mechanics), so maybe I'll just keep that disagreement to myself.

Hmm... that's one of those gray areas. Strictly speaking, it would be a violation of the Real World rules, but then, so would mentions of fines in the demoniation of the USD. Might be better to phrase it as "International Exchange Tax" or something like that, but if the only thing wrong with it is the mention of Tobin, I'd likely let it slide, just like I'd probably let an otherwise fine Proposal that mandates the use of Wankle engines, even while "rotary" would be better, or why using Nobel's name in the creation of a Nobel Prize would be okay. The name is more attached to the object it's describing, as opposed to the person it's named for.


okay I found something yesterday that kinda throws out the real world rules

http://forums.jolt.co.uk/showpost.php?p=9860784&postcount=11

From a mod no less. I know it states organizations, but that could be read as real world anything, if a RL org is okay, why not other references?


One other thing.

Currency trade isn't really a country to country thing, it's more or less a export/import issue, countries put contracts out for bonds, and either other countries or even individuals (very very very wealthy ones) or corporations purchase these bonds. So would this not limit international trade, not a social justice issue?

I think the 0.1% really could be a signifigant amount of money. Depending on your perspective. If you're trading in billions in bonds, say 150 billion you're taxing 150,000,000.00. that's a signifigant amount to anyone even a national with a BGP in the trillions (if there is any)


to get this to pass, show us specific models under which this might succeed, not just say it will.

okay I found something yesterday that kinda throws out the real world rules

http://forums.jolt.co.uk/showpost.php?p=9860784&postcount=11

From a mod no less. I know it states organizations, but that could be read as real world anything, if a RL org is okay, why not other references?

Maybe because that was in a thread about daily issues, and this is the UN forum?

Maybe because that was in a thread about daily issues, and this is the UN forum?


but they are reffering to the entire game. Didn't specify the daily issues, but Jennifer Government in general. That could be ment to imply everything in the system.

but they are reffering to the entire game. Didn't specify the daily issues, but Jennifer Government in general. That could be ment to imply everything in the system.

It could be, yes. It's not. Sirocco is an issue editor, talking in a forum about issues, on a thread about issues. TMGH is the author of the UN rules, talking in a forum about the UN, on a thread about the UN. Do the sums. They are different things entirely.

It could be, yes. It's not. Sirocco is an issue editor, talking in a forum about issues, on a thread about issues. TMGH is the author of the UN rules, talking in a forum about the UN, on a thread about the UN. Do the sums. They are different things entirely.


I know it's dumb, but if we're going to question 'tobin tax' lets stop using the term 'nuclear' or 'resolution' I mean we need to use real life terms for things, it makes it easier for people research and understand.

we need to draw a line in our stipulations. and use some common sense.

oh yeah, I'm probably just being blind, but i can't find a method of even changing my income tax.

I know it's dumb, but if we're going to question 'tobin tax' lets stop using the term 'nuclear' or 'resolution' I mean we need to use real life terms for things, it makes it easier for people research and understand.

we need to draw a line in our stipulations. and use some common sense.

There was a clear moderator ruling and IMO the proponents of this... thing... should abide by it and redraft or give up. At least insofar as the "modified" proposal is concerned. As L&E already indicated he does not support a "normal" Tobin Tax so it would be inconsistent to propose it 'as is'.

Now please someone give me a shovel so this draft can get a proper burial.

oh yeah, I'm probably just being blind, but i can't find a method of even changing my income tax.

Yes. I would say that this is due to your own incompetence with the issues. Try harder. It is possible.

I know it's dumb, but if we're going to question 'tobin tax' lets stop using the term 'nuclear' or 'resolution' I mean we need to use real life terms for things, it makes it easier for people research and understand.

we need to draw a line in our stipulations. and use some common sense.

oh yeah, I'm probably just being blind, but i can't find a method of even changing my income tax.

'Nuclear' and 'resolution' exist in NS; James Tobin does not. I might suggest you pick your fights, as you might have noticed my suggesting calling it a 'Tobin Tax' would be legal. But, in any case, a RL reference is clearly not a reference to 'anything that's real'. It's a reference to anything which exists outside NS: be it a person, a country, a study, a treaty. (I'm not sure about Jesus/Bible.)

And you change your income tax by answering issues. Some move you towards a progressive system, some to a flat; some raise, some lower.

'Nuclear' and 'resolution' exist in NS; James Tobin does not. I might suggest you pick your fights, as you might have noticed my suggesting calling it a 'Tobin Tax' would be legal. But, in any case, a RL reference is clearly not a reference to 'anything that's real'. It's a reference to anything which exists outside NS: be it a person, a country, a study, a treaty. (I'm not sure about Jesus/Bible.)

And you change your income tax by answering issues. Some move you towards a progressive system, some to a flat; some raise, some lower.


Thank you for the civil answer, instead of calling me incompotent about my issues. We are a new nation and still learning. I wouldn't call us incompotent, just perhaps uniformed, or ignorant.

The proposal calls for a change in the income tax rate, yet the option just isn't readily. Which really does make it a mechanics violation which I think you have specified in an earlier response.

Has anyone looked a model of this to see what the impact would be, I don't think it's that great of an idea.

Firstly, yes, mandating would be illegal: that's why they're changing it to 'STRONGLY URGES'. Now, there will be no mechanical effect on your nation's taxes. However, many people who play NS roleplay. As such, they would RP compliance. Yes, it's just 'pretending'. But that pretending is quite important. Purely mechanical resolutions would be dull as shit. (An especially opaque specimen, not a bright, shiny, gleaming, slithery one.)

Ahem. Anyway, the impact is kind of what this thread is debating. In RL, no global Tobin Tax or similar has ever been trialled. Microstudies aren't fully viable, in many people's opinions. So what we're doing is discussing whether such an idea would be good. I don't think so; I would say the larger opinion has been that it's not, although I am wearing my "Die commie die" glasses.

Ahem. Anyway, the impact is kind of what this thread is debating. In RL, no global Tobin Tax or similar has ever been trialled. Microstudies aren't fully viable, in many people's opinions. So what we're doing is discussing whether such an idea would be good. I don't think so; I would say the larger opinion has been that it's not, although I am wearing my "Die commie die" glasses.


yes, I would say this entire resolution reeks of communism/socialism. Which the nation of Naviblah thinks is entirely silly.

I know it's dumb, but if we're going to question 'tobin tax' lets stop using the term 'nuclear' or 'resolution' I mean we need to use real life terms for things, it makes it easier for people research and understand.

I am ambivalent about this, but the difference is obvious. James Tobin is a RL economist, he doesn't exist in the NS world. A nuclear weapon is based on the principle of nuclear fission, which holds wherever similar laws of nature apply.

As L&E already indicated he does not support a "normal" Tobin Tax so it would be inconsistent to propose it 'as is'.

Yes, the problem i have with a classical tobin tax, is what to do with the money?
And the answer is not simple.

Let's have a look to what happen to the last year Indian Ocean dramatic tsunami.

We witnessed a wonderful move towards compassion and solidarity in many nations, and this is great. Many humanitarian NGO get pourred with money and didn't know what to do with it. Only a part of it had been spend. The reason why is because most of these NGO are serious and want to spend it carrefully.

So it's why we propose to decrease other taxes, instead. I personnaly think the best to decrease it VAT, as this is the one which hit harder low income people. But we wanted to let the choice to each nation, which can also decrease a combination of several taxes.

Anyway, as we will uses "STRONGLY URGES" instead of MANDATES, if nations really don't want to take the opportunity to decrease VAT, income tax or other taxes, they will be able to spend the money where they want.

Further more, we will probably propably modify -2- soon to include one more option: decreasing public debt.

Ahem. Anyway, the impact is kind of what this thread is debating. In RL, no global Tobin Tax or similar has ever been trialled. Microstudies aren't fully viable, in many people's opinions. So what we're doing is discussing whether such an idea would be good. I don't think so; I would say the larger opinion has been that it's not, although I am wearing my "Die commie die" glasses.

:(
I am a strong supporter of the Tobin tax, yet I ressent being called a communist. I am sure James Tobin and George Soros would also be, errr, moderately annoyed. It is sad that something which, in my view, is a solid piece of economic theory, and so deserves to be debated on those grounds, can be:
a) Hijacked by extremist movements, and pathetically waved around as if it is going to solve world famine and cure diseases;
b) Dismissed by 'the other side' as a catastrophic protectionist measure, essentially on the grounds that it is defended by said extremists.

It was a joke.

I want to precise that neither compadria or I, did invoke that the tobin tax is the solution of every pb on earth. We just think that it will increase political and economical stability and that there will be something to do with the money (here we favour VAT or others taxes decrease)

Also, clause -E- is clear on the following matter:
"while encouraging free-floating or pegged floating rates"

It's time to come clean here.

I'm a Professor of Social Sciences (including Economics) in a British University, and I thought this game would be a bit of fun.

However, I'm reading so much complete rubbish from Gruenberg and his supporters, and it is making my blood boil so much, that it is no longer fun. That, together with reading horrifying and badly spelt crap about nuclear warfare in the Middle East on the 'General' board means that I have to go. It's just too depressing.

As a parting shot, here's something I wrote in a recent article:

"Global capital’s ‘casino culture’ encourages financial institutions to invest their clients’ money solely where it is likely to produce high short-term returns (Bourdieu, 1998; Ellwood, 2001), and at the moment currency speculation tends to generate significantly higher profits than most forms of commodity production, distribution or public service. Of the $1.5 trillion traded every day on the global money markets, 95% is simply bet on whether currency values and interest rates will rise or fall (Round, 2001). Investment is not arranged (and never has been in any absolute sense) by voluntary agreements between financial institutions, communities and politicians on the basis of social need, no matter how serious the consequences of capital retraction might be. By assuming the role of creditor and monopolising the management of the large-scale movement of finance capital, global financial institutions now wield unassailable power over states."

That's 95%. Think about it. 95% that, in a more sensible managed global economy, could be invested in infrastructure and services where they are needed.

Free-market economists are waffling secular priests who support a global elite who only have one interest: keeping the casino open so they can gamble and speculate. The free-market 'mechanics' that Gruenberg speaks of is nothing more than a load of mumbo-jumbo and tommy-rot that is injected into the heads of C-grade students in economics classes. To cut through that cloud of mystification and put it very crudely, the heart of the matter is this: the sort of 'liquidity' that currency speculation allows lubricates the flow of capital around the world. It is a method of creating what economists call the 'orbital economy', which is pemanently detached from the social needs of grounded communities around the globe. It is purely a device for big business, and it does nothing whatsover to encourage the development of local economies or prevent the haemorrhaging of industry and jobs from the West to the low-wage East. Visit the rustbelt in North East America, or the dying agricultural towns in the mid-West, or the crime-ridden former industrial cities of Northern England to see what I mean.

I don't have time to go into the complexities of all this. My advice for anyone reading this board is to get off it and read through the basics of this argument from reliable CRITICAL sources, not from some mendacious, superficial and misleading free-market economics text. Start with Wayne Ellwood's 'No-Nonsense Guide to Globalisation'.

Glutopia will soon 'cease to exist'. To Otterby and the rest, goodbye, and to the free-marketeers, when the meltdown occurs sometime this century, it is YOU, and only you, who are to blame.

Bye!

http://test256.free.fr/UN%20Cards/office.jpg

(And yes, this is a game. I have never suggested Gruenberg's IC politics correlate to my own OOC beliefs.)

I'm sorry to hear that you're leaving us Glutopia. You were an interesting debator and had many excellent points to make (and did make) on these fora. I would ask you, partly because of this and partly because I'm going to lose yet another endorsement, to reconsider. We all have differences and we all get frustrated, but I think we should consider the great value of these debates, in that they help sharpen our arguments in favour of our beliefs and make us at least attempt to comprehend the logic of our opponents.

Anyways, should you decide to leave none-the-less, I wish you well and hope you will return someday.

May the blessings of our otters be upon you.

Leonard Otterby
Ambassador for the Republic of Compadria to the U.N.

It's time to come clean here.

I'm a Professor of Social Sciences (including Economics) in a British University, and I thought this game would be a bit of fun.

However, I'm reading so much complete rubbish from Gruenberg and his supporters, and it is making my blood boil so much, that it is no longer fun. That, together with reading horrifying and badly spelt crap about nuclear warfare in the Middle East on the 'General' board means that I have to go. It's just too depressing.

As a parting shot, here's something I wrote in a recent article:

"Global capital’s ‘casino culture’ encourages financial institutions to invest their clients’ money solely where it is likely to produce high short-term returns (Bourdieu, 1998; Ellwood, 2001), and at the moment currency speculation tends to generate significantly higher profits than most forms of commodity production, distribution or public service. Of the $1.5 trillion traded every day on the global money markets, 95% is simply bet on whether currency values and interest rates will rise or fall (Round, 2001). Investment is not arranged (and never has been in any absolute sense) by voluntary agreements between financial institutions, communities and politicians on the basis of social need, no matter how serious the consequences of capital retraction might be. By assuming the role of creditor and monopolising the management of the large-scale movement of finance capital, global financial institutions now wield unassailable power over states."

That's 95%. Think about it. 95% that, in a more sensible managed global economy, could be invested in infrastructure and services where they are needed.

Free-market economists are waffling secular priests who support a global elite who only have one interest: keeping the casino open so they can gamble and speculate. The free-market 'mechanics' that Gruenberg speaks of is nothing more than a load of mumbo-jumbo and tommy-rot that is injected into the heads of C-grade students in economics classes. To cut through that cloud of mystification and put it very crudely, the heart of the matter is this: the sort of 'liquidity' that currency speculation allows lubricates the flow of capital around the world. It is a method of creating what economists call the 'orbital economy', which is pemanently detached from the social needs of grounded communities around the globe. It is purely a device for big business, and it does nothing whatsover to encourage the development of local economies or prevent the haemorrhaging of industry and jobs from the West to the low-wage East. Visit the rustbelt in North East America, or the dying agricultural towns in the mid-West, or the crime-ridden former industrial cities of Northern England to see what I mean.

I don't have time to go into the complexities of all this. My advice for anyone reading this board is to get off it and read through the basics of this argument from reliable CRITICAL sources, not from some mendacious, superficial and misleading free-market economics text. Start with Wayne Ellwood's 'No-Nonsense Guide to Globalisation'.

Glutopia will soon 'cease to exist'. To Otterby and the rest, goodbye, and to the free-marketeers, when the meltdown occurs sometime this century, it is YOU, and only you, who are to blame.

Glutopia, i think people are free try to win more money with their money even if you may not like it. The human brain is often run by greed, it may be sad, but it's reality. Our proposal don't stop speculation, we just think a bit of regulation is needed.

Here is the modified clause -2-, Compadria and I want to propose, including public debt:

-2- STRONGLY URGES all members to not increase the total amount of national administrations spending with this implementation of this tobin tax, by decreasing for an equivalent amount their others taxes and/or public debt, including but not limited to: income tax or value-added tax.


That said, Compadria and I posted a draft on the forum to introduce this new idea, discuss and debate the concept. We really like it, but we want to take our time before submitting it, and will probably not have the RL free time with the coming holidays.

Glutopia, i think people are free try to win more money with their money even if you may not like it. The human brain is often run by greed, it may be sad, but it's reality. Our proposal don't stop speculation, we just think a bit of regulation is needed.

Fine, then. You regulate it, and let Krioval not regulate it, and let's see which country advances faster. Kindly stop telling other countries how their economies are best run, or what is in their citizens' best interests. Krioval has a representative body directly elected to deal with these and other issues, and we have done quite well in the past decade.

高原由
クリオヴァル

Yoshi Takahara
Krioval

Could you use some of that free time to finally get around to rebutting some of our objections? According to Glutopia, they shouldn't be too hard to dismiss, so it won't take long. But responding in some way would be nice.

Gruenberg - I know you were joking. I was not commenting on your line specifically, rather on the general beliefs that drive the debate permanently into those extremes, both here and in RL.

Stuff like this doesn't help my case:

to the free-marketeers, when the meltdown occurs sometime this century, it is YOU, and only you, who are to blame.

I just get, well, sad when I read the idea that the TT is incompatible with free-markets, which honestly is a load of bull.

Fonzoland, don't disagree with the professor. He clearly knows best.

OOC: so let me get this straight, professor, and launch a few talking points in the process:

The general forum is... well... the sewer of this game. I wouldn't recommend it as a place to look for intelligent debate. Arrogant people like you and me who think themselves better have nationstates IRC channels and offsite boards for that. You were/are actually being considered for the exclusive membership of one of them already, but if you leave I guess that expires. Too bad. I kind of liked your style even if I disagreed with your politics.
You leave because there are people disagreeing with you in a political debate? I can only imagine that you dislike Free Marketeers, but with your superior knowledge and academic achievement surely it would be piss-easy to contradict our "ignorant" statements? If you teach, you should be even more aware how to do that. Then do so! God knows the Tobin tax deserves a better defence than the one it has been given by some people here.
Perhaps it hasn't occurred to you that in this game we we are role-playing that very global elite that you accuse us of supporting. Knootoss is a nation with a very open economy and vested international interests abroad and a very great dependence on MNCs. The "booh you are evil capitalists!" argument is not very impressive when you are talking to the representative of a very liberal/neoliberal government which hosts the NationStates version of a WTO-like organisation. Knootoss cares not for your rustbelts.
Goodbye, if you insist on leaving.

So I want to know what is wrong with a free market? You claim we're going to cause a global meltdown?


just remember this.
Those the can, do.
Those that can't, teach.

Especially in economics.

Socialism is all fine and dandy in theory, but due to that pesky human nature thing it just doesn't work. Even China is opening up to the free markets...

just remember this.
Those the can, do.
Those that can't, teach.

Especially in economics.

just remember this.
Don't attack one individual
by slandering an entire group.

Especially if you can't write.

Socialism is all fine and dandy in theory, but due to that pesky human nature thing it just doesn't work. Even China is opening up to the free markets...

China and the other "communist" nations, were never actually Socialist in the first place, so the point is moot.

May the blessings of our otters be upon you.

Leonard Otterby
Ambassador for the Republic of Compadria to the U.N.

China and the other "communist" nations, were never actually Socialist in the first place, so the point is moot.

May the blessings of our otters be upon you.

Leonard Otterby
Ambassador for the Republic of Compadria to the U.N.

No, they just weren't communist.

No, they just weren't communist.

Indeed, they apparently got stuck as dictatorships of the proletariat...

Indeed, they apparently got stuck as dictatorships of the proletariat...

I don't think they even got that far.

May the blessings of our otters be upon you.

Leonard Otterby
Ambassador for the Republic of Compadria to the U.N.

Glutopia will soon 'cease to exist'. To Otterby and the rest, goodbye, and to the free-marketeers, when the meltdown occurs sometime this century, it is YOU, and only you, who are to blame.

Goodbye, Professor. Your arrogance and condescension will echo through the ages. You were entitled to your opinion, as am I. Here is something you can take with you as you leave this game (for that is all it truly is):

Do not assume that because of your level of education and study of one particular ideology of economic thought this entitles you to claim omniscience over us all. Professors (of whatever field of study) are no more likely to "have it all figured out" as anyone else.

Please do not let the door hit you on the way out. It's a heavy oak number that kind of sneaks up on you.

Steve Perry, GCRC,
President.

Fine, then. You regulate it, and let Krioval not regulate it, and let's see which country advances faster. Kindly stop telling other countries how their economies are best run, or what is in their citizens' best interests. Krioval has a representative body directly elected to deal with these and other issues, and we have done quite well in the past decade.

高原由
クリオヴァル

Yoshi Takahara
Krioval

Krioval, it's a proposition, dozens of proposition are proposed every weeks, and they should pass a 2 stages democratic process, to become a resolution, so we are not telling anything we are proposing.

Krioval, it's a proposition, dozens of proposition are proposed every weeks, and they should pass a 2 stages democratic process, to become a resolution, so we are not telling anything we are proposing.

You say that. But even when your proposals get ripped to shit in the forum, you submit them anyway. And you still haven't replied to Knoot's objections.

Porkins tried to stay on target and he failed:

http://jekporkins.net/porkins4s.jpg

Don't you make the same mistake.

-Dargan "The Anti-Hijacker" Zaraad
Office of Unofficial Official Statements
The Federated Technocratic Oligarchy of the Most Glorious Hack


In other words, let's stop worrying about the "professor's" fevered rant and go back to discussing the Proposal.

Fine, then. You regulate it, and let Krioval not regulate it, and let's see which country advances faster. Kindly stop telling other countries how their economies are best run, or what is in their citizens' best interests. Krioval has a representative body directly elected to deal with these and other issues, and we have done quite well in the past decade.

高原由
クリオヴァル

Yoshi Takahara
Krioval

*stands and applauds*

We find it doubtful that this measure would have any effect, stabilizing or otherwise, on international currency exchange. It is simply a tax, a way of raising revenue. If you want to present it as a tax, and then justify it by explaining the programs that it would be used to fund, that's fine. But don't try to convince me that this will stabilize the currency markets. It won't.

We find it doubtful that this measure would have any effect, stabilizing or otherwise, on international currency exchange. It is simply a tax, a way of raising revenue. If you want to present it as a tax, and then justify it by explaining the programs that it would be used to fund, that's fine. But don't try to convince me that this will stabilize the currency markets. It won't.

I am trying not to get involved in this thread, since I don't want to be confused with some of the arguments presented in defense of the proposal. But your statement is factually false, and I will indeed try to convince you of that elsewhere. Soon. ;)

I am trying not to get involved in this thread, since I don't want to be confused with some of the arguments presented in defense of the proposal. But your statement is factually false, and I will indeed try to convince you of that elsewhere. Soon. ;)
Meh. Would you prefer that I argue this from the left (http://www.marxist.com/Europe/tobin_tax_and_ATTAC_400.html) or the right (http://www.worldbank.org/fandd/english/0696/articles/050696.htm)? :)

Meh. Would you prefer that I argue this from the left (http://www.marxist.com/Europe/tobin_tax_and_ATTAC_400.html) or the right (http://www.worldbank.org/fandd/english/0696/articles/050696.htm)? :)
OOC: Hahaha. That is just fucking brilliant. In feel kind of sorry for Fonzo the econometrist here though.

Meh. Would you prefer that I argue this from the left (http://www.marxist.com/Europe/tobin_tax_and_ATTAC_400.html) or the right (http://www.worldbank.org/fandd/english/0696/articles/050696.htm)? :)

I sincerely hope you do not follow the line from "the left," it sounds like total bull. The one from "the right" is articulate, but it is attacking a specific variation of the TT, and his main objections against the original TT seems to be lack of empirical evidence, and implementation issues.
Anyway, I acknowledged here before that there are plenty of intelligent people for/against. Surely you don't doubt the existence of economically correct arguments supporting the TT? I don't think I would need to find them for you.

Anyway, I acknowledged here before that there are plenty of intelligent people for/against. Surely you don't doubt the existence of economically correct arguments supporting the TT? I don't think I would need to find them for you.

I think, perhaps, his point was that if you so readily concede that there are strong arguments both for and against, then the subject might not make the most suitable basis for binding international legislation. I do not have the economic prowess to rebut all, or even many, of the supporters of the Tobin Tax, but at the same time, there is not one overwhelming argument in favour, that negates all opposition. As such, introducing the tax is doubly unwise, not only because we would be uncertain of its effects, but also because currency traders would probably not bother to wait around and see.

I think, perhaps, his point was that if you so readily concede that there are strong arguments both for and against, then the subject might not make the most suitable basis for binding international legislation. I do not have the economic prowess to rebut all, or even many, of the supporters of the Tobin Tax, but at the same time, there is not one overwhelming argument in favour, that negates all opposition. As such, introducing the tax is doubly unwise, not only because we would be uncertain of its effects, but also because currency traders would probably not bother to wait around and see.

I disagree, obviously, but I accept that the case "for" has not been made here. From my part, I would prefer to let this wretched thread die...