Australian economists join worldwide call for a Financial Transaction Tax
Download MEDIA RELEASE Australian economists join worldwide call for FTT – 14 April 2011
A thousand economists from 53 countries have written to G20 Finance Ministers who are meeting in Washington to urge the adoption of a financial transaction tax.
Economists wrote: “The financial crisis has shown us the dangers of unregulated finance, and the link between the financial sector and society has been broken. It is time to fix this link and for the financial sector to give something back to society.”
Several Australian economists have supported the letter.
University of Queensland Professor John Quiggin said “The global financial crisis is evidence that self-managing markets do not ensure stability or reduce volatility. Governments must intervene to manage risks including the implementation of a financial transaction tax.”
Professor Geoff Harcourt, Professor Emeritus (Adelaide) and Emeritus Reader in the History of Economic Theory (Cambridge) said: “A financial transaction tax would reduce the amount of speculative funds circulating and make people concentrate on funds associated with real and beneficial economic activity.”
Professor Andrew McLennan from University of Queensland said “A financial transaction tax would be easy to collect and administer, and would protect ordinary people saving for education and retirement. Such taxes were common in the past, so we know they can work well.”
These Australian economists joined professors from many of the world’s leading universities, including Harvard, Oxford, Cambridge, the Sorbonne, Berkeley and Kyoto, in signing the letter. Signatories include Jeffrey Sachs, Director of the Earth Institute, Colombia University and special advisor to UN Secretary General Ban Ki Moon, Dani Rodrik, Professor of Political Economy at Harvard University, Professor Ha Joon Chang from Cambridge and Christian Fauliau, a former World Bank senior economist.
Professor Sachs said: “It is time for the G20 to agree to a tax on financial transactions to help poor countries struggling with climate, food, and economic crises they did nothing to cause. The tax would also be a fair and efficient way to help close budget deficits in our own countries as well.”
The letter was delivered to G20 finance ministers ahead of their meeting today in Washington and to Bill Gates, philanthropist and founder of Microsoft who has been asked by the G20 to examine innovative options to raise money for development and climate change. It is the latest sign of increased support for financial transaction taxes which are supported by a growing number of governments including France and Germany.
The letter comes as the G20 chair French President, Nicolas Sarkozy has championed a financial transaction tax as one of the priorities for the group this year.
