New Labour’s Damascus Like Conversion – Taxing Financial Transactions

I read with interest today’s Western Mail three page spread on the Secretary of State for Wales’ support for the ‘Robin Hood’ tax on speculative currency transactions. There’s little coincidence that Peter Hain’s announcement, and the support of Gordon Brown for the idea, comes in the immediate aftermath of the obscene bonuses published by Barclays yesterday.

The Robin Hood tax forbearer of course was the Tobin Tax which first came to light as far back as 1971. Plaid Cymru has consistently campaigned for such a tax as a redistributive measure that would raise billions for international development as well as curbing speculative behaviour. Forgive me for being sceptical, but Labour has been in power for 13 years now – so where exactly have they been?

Undoubtedly the answer Messrs Hain and his colleagues will spout is that following the complete collapse of the financial system and the subsequent recession, the public will now exists to support the restriction of banking and speculative excess. However, it’s the job of politicians to lead and shape a future based on values. New Labour’s problem is that too much of their politics has been based on focus groups. I fear that this directionless Labour Government lacks the political credibility to lead the necessary banking and financial reforms so desperately needed to avert another financial disaster.

The reality is that Labour’s response to the financial system has meant the complete opposite to a Robin Hood type solution – with unimaginable redistribution of wealth from the poor to the super rich. The enormous banking bailout means that the casino bankers are free to rake in their multi million pound bonuses whilst the rest of us are faced with a public debt legacy that will last a generation – with the very select few who benefited from the bailout now screaming for a careless public sector cut which will further disadvantage the vulnerable and drive us towards a double dip recession.

In their subservience to the square mile and the economic establishment during their tenure in power at UK level, Labour knows they’ve got a huge perception problem. Jumping on the Robin Hood tax bandwagon is clever politics for them in the lead up to the General Election – and there is no cleverer politician than Peter Hain.

Let’s hope this is more than a gimmick announcement by Peter Hain and that in its dying days in government the Labour party lay the foundations for a global agreement. At least its epitaph might then include something positive.

As for the currency speculators they might want to employ Mr Hain as a consultant on tax evasion following his admittance to the Electoral Commission that he failed to declare £100,000 in campaign donations during his failed bid for the Deputy Leadership of his party in 2008!

I will be chairing an Oxfam fringe meeting at this weekends Plaid Spring Conference in which policy Director Lila Haines will be talking about the proposed Robin Hood Tax. I look forward to a detailed debate.

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