Free State Project Forum

Please login or register.

Login with username, password and session length
Pages: [1]   Go Down

Author Topic: tobin  (Read 7598 times)

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
tobin
« on: November 01, 2002, 10:28:42 pm »

I, like all libertarians am against tax on individuals.

However I would be interested in knowing what fellow FSPers thought about the tobin tax (http://www.waronwant.org).

I would call myself a global justice activist (although the media would probably brand me 'anti-globalisation') and although the free market definately has a promenant place in helping the world, I believe that it isn't sufficient on its own.


Logged

JasonPSorens

  • Administrator
  • *****
  • Offline Offline
  • Posts: 5726
  • Neohantonum liberissimum erit.
    • My Homepage
Re:tobin
« Reply #1 on: November 01, 2002, 10:46:49 pm »

Well, James Tobin has basically disowned the people who are using his idea to promote a global tax on capital.  I think it's a bad idea because it raises transactions costs on flows that are Pareto-beneficial.  Currency speculation is the market's way of punishing irresponsible governments.  The problem is not the markets: it's governments that inflate the money supply irresponsibly and rob their citizens blind.  Globalization of the market generally benefits the world's poor: that's why 3rd World countries desperately want access to 1st World markets.  But globalization is not a panacea, especially when so many dysfunctional governments abound throughout the world.
Logged
"Educate your children, educate yourselves, in the love for the freedom of others, for only in this way will your own freedom not be a gratuitous gift from fate. You will be aware of its worth and will have the courage to defend it." --Joaquim Nabuco (1883), Abolitionism

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
Re:tobin
« Reply #2 on: November 01, 2002, 10:58:52 pm »

I think it's a bad idea because it raises transactions costs on flows that are Pareto-beneficial.

what does that mean?

Globalization of the market generally benefits the world's poor

i would agree, would you also say that globalisation of high labour standards is a good idea?

But globalization is not a panacea, especially when so many dysfunctional governments abound throughout the world.

indeed, dysfunctional governments and multinational corporations eager to take advantage of them.

Well, James Tobin has basically disowned the people who are using his idea to promote a global tax on capital.

1. do you have a url for this? (did he just say he was wrong, or was he just against specifics)
2. I thought it was a tax on financial speculation not on capital.

Currency speculation is the market's way of punishing irresponsible governments.

is there not a way of punishing the governments without also punishing the people who live under them?

The problem is not the markets: it's governments that inflate the money supply irresponsibly and rob their citizens blind.

the governments and the multinational corporations are in it together. both could care less if they can spin a quick buck.
Logged

JasonPSorens

  • Administrator
  • *****
  • Offline Offline
  • Posts: 5726
  • Neohantonum liberissimum erit.
    • My Homepage
Re:tobin
« Reply #3 on: November 01, 2002, 11:12:44 pm »

I think it's a bad idea because it raises transactions costs on flows that are Pareto-beneficial.

what does that mean?

The transactions benefit both buyer and seller with hurting anybody else.

Quote
Globalization of the market generally benefits the world's poor

i would agree, would you also say that globalisation of high labour standards is a good idea?

"High labor standards" are of course good, but I would say they're a result of technology and improvements in human capital.  I'd definitely be opposed to a world government imposing workweek regulations and a global minimum wage and so on.  These things actually hurt the poorest and help skilled workers avoid competition.

Quote
But globalization is not a panacea, especially when so many dysfunctional governments abound throughout the world.

indeed, dysfunctional governments and multinational corporations eager to take advantage of them.

Multinational corps sometimes get a bad rap.  Most of the oil corps have done some genuinely evil things.  Corps involved in things like textiles, OTOH, have created real advances in human capital and brought wealth to poor communities.

Quote
Well, James Tobin has basically disowned the people who are using his idea to promote a global tax on capital.

1. do you have a url for this? (did he just say he was wrong, or was he just against specifics)
2. I thought it was a tax on financial speculation not on capital.

I'll look for a URL...he hasn't disowned the idea of a tax on currency flows, just some specific proposals.  Currency holdings are generally considered a type of capital, depending on what you're talking about.

Quote
Currency speculation is the market's way of punishing irresponsible governments.

is there not a way of punishing the governments without also punishing the people who live under them?

Heh.  If there is, let me know!  The problem is that these governments are not democratic, so they're not even remotely responsive to their people's suffering.  So punishing the government by punishing the economy (and thus the people) doesn't really help.  On the other hand, if you forcibly prevent investors from trying to minimize their losses by pulling investments out, you create more poverty in the long run, because then no one wants to invest in the first place.  Tobin's idea was simply that a very low tax on currency flows could slow or moderate some of the wilder speculative swings, not retard actual investment flows significantly.
Logged
"Educate your children, educate yourselves, in the love for the freedom of others, for only in this way will your own freedom not be a gratuitous gift from fate. You will be aware of its worth and will have the courage to defend it." --Joaquim Nabuco (1883), Abolitionism

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
Re:tobin
« Reply #4 on: November 01, 2002, 11:28:55 pm »

"High labor standards" are of course good, but I would say they're a result of technology and improvements in human capital.  I'd definitely be opposed to a world government imposing workweek regulations and a global minimum wage and so on.  These things actually hurt the poorest and help skilled workers avoid competition.

I'd agree that high labour standards are partly a result of technology i would argue that unions have also played a role in improving living standards. i'm not sure what you mean by 'human capital'. i guess what i am trying to get at is that it would be beneficial to everyone if there was some kind of framework in place to stop corporations profiteering from lax labour laws and low standards of living. this would also help those unemployed in the developed world who wouldn't automatically be excluded because cheaper labour can be found abroad.

Multinational corps sometimes get a bad rap.  Most of the oil corps have done some genuinely evil things.  Corps involved in things like textiles, OTOH, have created real advances in human capital and brought wealth to poor communities.

Indeed and this is why i don't completely trust capitalism. It is based on greed. If you can make more money by employing someone in poorer country with lower standards of living then they will. I'm sure some corporations have helped local communities but i would be pessimistic about the amounts.

I'll look for a URL...he hasn't disowned the idea of a tax on currency flows, just some specific proposals.  Currency holdings are generally considered a type of capital, depending on what you're talking about.

Ok, i'd be interested to see how what he proposed differs from what the 'war on want' organisation is suggesting.

Tobin's idea was simply that a very low tax on currency flows could slow or moderate some of the wilder speculative swings, not retard actual investment flows significantly.

I'm no economist, i have a passing interest and plan to study it further in the future. could you explain to me what you mean by the above sentence and what its effects would be.
Logged

Eddie_Bradford

  • FSP Participant
  • *****
  • Offline Offline
  • Posts: 567
Re:tobin
« Reply #5 on: November 02, 2002, 02:44:27 am »

Quote
i guess what i am trying to get at is that it would be beneficial to everyone if there was some kind of framework in place to stop corporations profiteering from lax labour laws and low standards of living. this would also help those unemployed in the developed world who wouldn't automatically be excluded because cheaper labour can be found abroad.

No I dissagree.  Please define what you mean by 'profiteering' because any example you give where a company acts legally I will be able to show you that actually the people are better off in that country working for that company that is 'exploiting' them (by legally I mean that the company is not enslaving people or useing force).  When you say a company is 'taking advantage' of people with a low standard of living, that company is in actuality giving that person a job they would not otherwise be able to get.  Maybe you think that they should pay these people $30,000 per year ("no not that much necissarily" ["doesn't matter because it's still an arbatrary restriction"]) well you know what, if the company has to pay that much then they go out of business because they can't stay fiscally solvent paying that much money.  Bottom line is that labor laws, minimum wages, hiring restrictions, tarriffs ALL hurt the poor, ALL hurt the American consumer and therefore every American, and help to keep the poor people of the world in their sqallid mess that they are in.  People can protest and yell all they want that this company isn't paying a 'fair' wage but until they offer up your own money to start paying someone's wage they are hurting these poor people.
-Eddie
Logged

wolf_tracker

  • ****
  • Offline Offline
  • Posts: 122
  • Live Free or Die
Re:tobin
« Reply #6 on: November 02, 2002, 08:31:55 am »

Everyone here seems to like Walter Williams...
read this weeks column on just this topic...

then tell us how all these companies are big
and bad

http://www.jewishworldreview.com/cols/williams1.asp

Logged

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
Re:tobin
« Reply #7 on: November 02, 2002, 10:11:12 am »

where a company acts legally

legally according to local laws, legally according to international laws or legally according to laws in the US?

you say 'enslaving'. what if the local government is doing to enslavement in collusion with the company as has happened in so many cases.

sure, maybe if it was all legal according to the laws in america then there would be no problem. however when you are talking about governments that couldn't care less about their people and are only glad for the backhanders corporations are willing to give them then you have a problem.

how would you feel if you could only go to the toilet or have a drink once in an 8hour shift?

by profiteering i mean: a pair of shoes costs nike $3 in labour and they charge $100 per pair in the US. i'm definately not saying that they shouldn't make a profit (they are no good to anyone insolvent), but they should pay their workers more out of the profit.

Bottom line is that labor laws, minimum wages, hiring restrictions, tarriffs ALL hurt the poor

how is it then that standards of living are higher in countries with these laws?

People can protest and yell all they want that this company isn't paying a 'fair' wage but until they offer up your own money to start paying someone's wage they are hurting these poor people.

people do, by buying fair trade products more money goes to the producer and less money goes in the pockets of the middlemen.

So who are you taxing? Businesses? Corporations? Even one-person corporations? The latter IS an individual.

i don't accept that a corporation is an individual.

businesses already get a lot of tax breaks that individuals don't. they don't have to pay vat (17.5%) on anything they buy for instance.

regarding the walter williams article...

he doesn't give enough detail. how much is the company making off the back of this cheap labour? are they putting him under health risks (health and safety laws in developing countries aren't exactly comprehensive (see union carbide disaster in india)).

what he is basically saying is: unions are bad because they want higher wages. if you pay people more to create something then you have to pay more for the product. normally, yes but with the enormous profits these companies are making don't you think that they could maybe skimp on the private jets and maybe pay the people who are actually doing the work more?

i agree with him that it is absurd to suggest that it is government business to create 'jobs', however why doesn't he rail against the subsidies and trade tariffs, the deals with the government, the huge currency hole that is the DEA, the huge amount of military aid going to countries with atrocious human rights records, the dumping of US crops on the world market at a loss to undermine third world growers/sellers.

i guess what i am trying to say is that corporations will do whatever they can to make profits. if they are big enough they can make the government give them preferential treatment. if they are even bigger they can even influence government policy.

this is bad.
Logged

wolf_tracker

  • ****
  • Offline Offline
  • Posts: 122
  • Live Free or Die
Re:tobin
« Reply #8 on: November 02, 2002, 10:49:56 am »

what he is basically saying is: unions are bad because they want higher wages. if you pay people more to create something then you have to pay more for the product. normally, yes but with the enormous profits these companies are making don't you think that they could maybe skimp on the private jets and maybe pay the people who are actually doing the work more?

no what walter is basically saying is that the ppl are better off getting
paid double the average wage over no wage at all ... and dont forget
how productive the ppl are ... the more productive the more the pay ...

ppls forget how many expenses companies must pay to build the
plants for the ppls to work in ...

and last who wants to buy the most expensive items out there ...
ppl are always trying to buy what they want for the cheapest price



Logged

wolf_tracker

  • ****
  • Offline Offline
  • Posts: 122
  • Live Free or Die
Re:tobin
« Reply #9 on: November 02, 2002, 10:51:53 am »

i agree with him that it is absurd to suggest that it is government business to create 'jobs', however why doesn't he rail against the subsidies and trade tariffs, the deals with the government, the huge currency hole that is the DEA, the huge amount of military aid going to countries with atrocious human rights records, the dumping of US crops on the world market at a loss to undermine third world growers/sellers.

if you read walter regulary ... he does complain about all these
that is why he said nice things about the fsp
Logged

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
Re:tobin
« Reply #10 on: November 02, 2002, 01:37:17 pm »

no what walter is basically saying is that the ppl are better off getting
paid double the average wage over no wage at all ... and dont forget
how productive the ppl are ... the more productive the more the pay ...


ok, fair enough, but what about dangerous jobs or jobs that shorten their life span because of lax safety laws? i'm not just complaining about the low wages but about the working conditions aswell.

ppls forget how many expenses companies must pay to build the
plants for the ppls to work in ...


no they don't, they realise the expense. however the companies aren't going to poorer countries to improve the local economy or to help out local communities. they are going there for the sole reason that it is *cheaper*, often *vastly* cheaper than in the developed world. don't try and make me feel sorry for the poor hard done by businesses because people are asking them to pay their workers more. wage/hour in the developing world ~$0.20, wage/hour in the developed world ~$4.50. they are making a huge saving in labour costs, is it not reasonable to ask them to pass on some of that saving to their workers? they can still make good profits and pay their workforce more. they just don't because they are greedy (i'm not saying this in necessarily an insulting way, but it is what capitalism is based on).

and lets not forget the reasons why labour is cheaper in the developing world. 1. because living standards are lower. 2. because labour laws are more lax. 3. because unions are often either bullied or outright illegal. 4. because governments are corrupt. (if there are other reasons why labour is cheaper, please mention them)

and last who wants to buy the most expensive items out there ...
ppl are always trying to buy what they want for the cheapest price


well, the huge luxury goods market would suggest that people don't always want just the cheapest.
Logged

5pectre

  • FSP Participant
  • ****
  • Offline Offline
  • Posts: 322
  • terrorism is the symptom not the disease -1.5/-7.7
    • home
Re:tobin
« Reply #11 on: November 02, 2002, 04:20:09 pm »

As long as employment is voluntary, and the employees are adequately informed about conditions, and the employees have protection for speaking out ("Free speech"  in a business environment - what a concept!)

The problem is that they don't.

Given the above (no fraud, etc. from the employer) it is the employee's choice to work in such an environment. This is like people choosing to ski, kayak, snowboard, parachute, etc. Also note that the "safety laws" are to prevent employees from doing stupid, dangerous things - to themselves and other employees. It is the individual's responsiblity to not get themselves into dangerous situations that would result in injury or illness or long-term damage to hearing, etc. If they do, it is their own choice and their personal responsiblity - again, what a concept.

Indeed it is their own personal responsibility if they are made fully aware of the risks.

If a person, and I've known many such as this, who chooses to work in a noisy, dusty, toxic environment without using the provided and even mandatory personal protection equipment -- then it is their own darn fault and responsiblity for being, in old age, hard of hearing and with clogged up lungs, and skin problems. That is why "Material Safety Data Sheets" (MSDS's) are to be available to all who handle a chemical.

Indeed and this is why the laws exist. If the employee chooses not to use the safety equipment provided by the company then he deserves whatever he gets. However if he is not told about the required safety equipment and none is provided for him then I would put the company at fault.

I had an experience this summer where a fellow employee was negligent and put us all in danger. Though the employer had been told, we should have taken the responsiblity to say sooner that we will not work with that person. We didn't and thus, really, it was our fault for the equipment damage and the very close call to injury.

It was the fault of your coworker for being negligent. I wouldn't say it was your fault for the equipment damage caused by your coworker.
Logged

JasonPSorens

  • Administrator
  • *****
  • Offline Offline
  • Posts: 5726
  • Neohantonum liberissimum erit.
    • My Homepage
Re:tobin
« Reply #12 on: November 03, 2002, 10:31:31 pm »


I'd agree that high labour standards are partly a result of technology i would argue that unions have also played a role in improving living standards. i'm not sure what you mean by 'human capital'.

Human capital means skills, education, etc.  Multinationals often improve human capital by bringing in new manufacturing methods, funding schools, and so on.

Quote
i guess what i am trying to get at is that it would be beneficial to everyone if there was some kind of framework in place to stop corporations profiteering from lax labour laws and low standards of living.

This kind of profiteering is good!  That's the way the poor get richer: capital moves to where wages are low, then as productivity rises, wages rise.  This is what happened to places like Singapore, Hong Kong, and Taiwan.  They were once very poor, but they brought in foreign capital, liberalized their markets, and grew rich.  Foreign direct investment is positively associated with economic growth; this is an established fact.

Quote
Tobin's idea was simply that a very low tax on currency flows could slow or moderate some of the wilder speculative swings, not retard actual investment flows significantly.

I'm no economist, i have a passing interest and plan to study it further in the future. could you explain to me what you mean by the above sentence and what its effects would be.

In 1997 foreign investors sold their holdings of East Asian currencies (the yen, the Thai baht, etc.) and bought dollars and other stable currencies.  They did this because they feared a financial meltdown in these countries.  In the event, many of these fears were unjustified and most of these countries weathered the storm.  In the meantime, however, the massive depreciation in their currencies made imports really expensive in these countries and threw monetary policies out of whack.  Tobin's idea is that we should slow down the conversion of currencies in order to prevent this from happening in the future.  However, currency conversion can also be a way of punishing governments for inflating their currencies, as I mentioned earlier.
Logged
"Educate your children, educate yourselves, in the love for the freedom of others, for only in this way will your own freedom not be a gratuitous gift from fate. You will be aware of its worth and will have the courage to defend it." --Joaquim Nabuco (1883), Abolitionism
Pages: [1]   Go Up