As global capital becomes ever more powerful, giant corporations are holding governments and citizens up for ransom \u2013 eliciting subsidies and tax breaks from countries concerned about their nation\u2019s \u201ccompetitiveness\u201d \u2013 while sheltering their profits in the lowest-tax jurisdictions they can find. Major advanced countries \u2013 and their citizens \u2013 need a comprehensive tax agreement that won\u2019t allow global corporations to get away with this.<\/p>\n
Google, Amazon, Starbucks, every other major corporation, and every big Wall Street bank, are sheltering as much of their U.S. profits abroad as they can, while telling Washington that lower corporate taxes are necessary in order to keep the U.S. \u201ccompetitive.\u201d<\/p>\n
Baloney. The fact is, global corporations have no allegiance to any country; their only objective is to make as much money as possible \u2013 and play off one country against another to keep their taxes down and subsidies up, thereby shifting more of the tax burden to ordinary people whose wages are already shrinking because companies are playing workers off against each other.<\/p>\n
I\u2019m in London for a few days, and all the talk here is about how Goldman Sachs just negotiated a sweetheart deal to settle a tax dispute with the British government; Google is manipulating its British sales to pay almost no taxes here by using its low-tax Ireland subsidiary (the chair of the Parliamentary committee investigating this has just called the do-no-evil firm \u201cdevious, calculating, and unethical\u201d); Amazon has been found to route its British sales through a subsidiary in low-tax Luxembourg, and now receives more in subsidies from the British government than it pays here in taxes; Starbucks\u2019 tax-avoidance strategy was so blatant British consumers began boycotting the firm until it reversed course.<\/p>\n
Meanwhile, At a time when you\u2019d expect nations to band together to gain bargaining power against global capital, the opposite is occurring: Xenophobia is breaking out all over.<\/p>\n
Here in Britain, the UK Independence Party \u2013 which wants to get out of the European Union \u2013 is rapidly gaining ground, becoming the third most popular party in the country, according to a new poll for The Independent on Sunday. Almost one in five people plan to vote for it in the next general election. Ukip\u2019s overall ratings have risen four points to 19 per cent in the past month, despite Prime Minister David Cameron\u2019s efforts to wrest back control of the crucial debate over Britain\u2019s relationship with the European Union.<\/p>\n
Right-wing nationalist parties are gaining ground elsewhere in Europe as well. In the U.S., not only are Republicans sounding more nationalistic of late (anti-immigrant, anti-trade), but they continue to push \u201cstates rights\u201d \u2013 as states increasingly battle against one another to give global companies ever larger tax breaks and subsidies.<\/p>\n
Nothing could strengthen the hand of global capital more than such breakups.<\/p>\n