A broad coalition has formed in support of a financial transactions tax (see previous EG4H blog). Following the English legend, they are styling the tax as a ‘Robin Hood tax’ – robbing the rich to give to the poor. The campaign is centred on a video with Bill Nighy directed by Richard Curtis and is sure to reach a broad audience and get huge profile for the cause.

The campaign is a clear signal that a financial transactions tax or ‘tobin tax’ is now firmly on the political agenda. Until recently it was no more than a dream in the eyes of a few. Overnight, it is being discussed openly in the media, seeing the support of Europe’s leaders (Brown, Sarkozy, Merkel) as well intellectual heavyweights like Nobel Laureate Prof. Joseph Stiglitz and 350 other leading economists. There is reason for genuine optimism amongst activists that a progressive tax such as this could be implemented.

There are still major obstacles, not least the continuing opposition of the US Government, but many are confident of an agreement in the future. Popular support and pressure will certainly increase those changes and we encourage you to sign the online petition at robinhoodtax.org. UK-based supporters can sign the Avaaz petition. UK-based medical advocates can email their MP with just 2-clicks via Health Unlimited. Those of you with a Facebook account can join the 100 000+ Facebook fans.

Below Rick Rowden introduces his new book.  In the following months Rick will respond to any comments or posts and discuss the reaction to the book and the outlook for activism.

“The Deadly Ideas of Neoliberalism” explores the history of and current collision between two of the major global phenomena that have characterized the last 30 years: the spread of HIV/AIDS and other diseases of poverty and the ascendancy of neoliberal economic ideas. The book explains not only how IMF policies of restrictive spending have exacerbated public health problems in developing countries, in particular the HIV/AIDS crisis, but also how such issues cannot be resolved under these economic policies. It also suggests how mounting global frustration about this inability to adequately address HIV/AIDS will ultimately lead to challenges to the dominant neoliberal ideas, as other more effective economic ideas for increasing public spending are sought.

In stark, powerful terms, this book offers a unique and in-depth critique of development economics, the political economy dynamics of global foreign aid and health institutions, and how these seemingly abstract factors play out in the real world – from the highest levels of global institutions to African finance and health ministries to rural health outposts in the countryside of developing nations, and back again.

It argues that HIV/AIDS activists and global public health advocates should see health financing within the broader view of development economics, and should examine the efficacy of the current “development model” supported and reinforced by bilateral and multilateral aid donors. Aid advocates have placed an overemphasis on external factors (more ODA, more debt cancellation, more trade access into Northern markets, more FDI, etc) to the neglect of issues related to domestic resources mobilization and development economics.

The book calls on health advocates to work more with economists and others to reconsider the underlying precepts and micro-foundations of neoclassical economic theory, particularly monetarism, and examine their efficacy in light of the documented development outcomes and indicators of recent decades. The book argues the dominant strain of neoliberal policies, which provide the basis for the current development model, constantly prioritizes short-term stability of financial variables (inflation, deficit levels, foreign exchange reserves, etc) to the subordination and neglect of real sector variables such as economic growth rates, employment levels or levels of public spending and investment. While this emphasis has succeeded in achieving “macroeconomic stability” in countries, it has also come at the price of insufficient growth, high unemployment and underemployment, chronically insufficient health spending and public investment in the underlying health system infrastructure, and has not resulted in successful economic development.

The current development model has led to unnecessarily worse health outcomes than otherwise could be the case under alternative macroeconomic policy approaches that could enable higher levels of public spending and investment. The book calls on HIV/AIDS activists and global public health advocates to work with economists and others to re-open the debate amongst the broader development community to reconsider more broadly the failures of the current development model and to re-establish what ought to be the benchmarks for successful economic development and development models for donor aid.

For more information on the book see:

http://www.zedbooks.co.uk/book.asp?bookdetail=4333

The idea of a Tobin tax is suddenly popular amongst many who have long opposed it. This interest from the magicians running the global economy could act to prevent discussion on other much needed reform.

Many people have called for a Tobin tax for years. It is seen as a neat way to raise billions of dollars for social causes and help control the instability and greed lurking in the global economy. A Tobin tax was originally conceived as a tax on the buying and selling of currencies, with the intention of reducing speculation and bringing stability to the world economy. The idea has now been revived in the form of a finance transaction tax (more than just currency exchanges as suggested by Mr Tobin). This latest incarnation intended to put a stop to a reckless banking system.

NGOs and civil society have long supported the idea, but the dominant institutions and governments of the global economy have dismissed it.  But the current economic and financial crisis is pushing the idea to the top of the agenda. Adair Turner, a central figure in the UK financial sector, has spoken in favour – see past EG4H newsletters – along with various European governments. And now UK Prime Minister Gordon Brown has also come out in support. The G20 have even asked the IMF to explore the feasibility of such a tax.

So what lies behind the interest in a Tobin tax? Specifically, why are people and institutions so long resistant to a Tobin tax now talking about it seriously?

One response is that it is quite simply a good idea. It has the potential to raise billions of dollars and would help control a finance industry that has floated free of ideas of needing to benefit wider society. There are undoubtedly many with influence in the global economy who were genuinely shocked by the failure of old ideas that led to the current economic crisis; they are perhaps sincerely prepared to reach for different ideas.

But Gordon Brown promoting it? The G20 asking the IMF to look into its feasibility? These aren’t exactly people or institutions famed for re-examining old views and past decisions with an open mind.

A second response then to what lies behind the talk of a Tobin tax is that while it would be a radical reform, it may be a politically handy ‘trick’ to cover the lack of even more radical reform.

The magicians that conjured up the current global economic system and maintained the illusion it was effective -  the IMF, the G20, Gordon Brown and others – know something must be done.  Voters are angry and increasingly suspicious of those that who on watch when the economic crisis unfolded. So some change is inevitable. And a Tobin tax is a popular idea right now. Institutions like the IMF and Gordon Brown could see implementing the Tobin tax as a useful way of escaping a deeper scrutiny of the flaws in the global economy and how it is run. A Tobin tax could be implemented and the running of banks may change slightly, yet the unequal systems of trade and subsidy are left untouched and the major institutions of the G20, the IMF, the World Bank remain non-transparent, unaccountable and undemocratic . And the unequal system that perpetuates ill-health and poverty continues.

Exploration of the Tobin tax is welcome – whoever is doing it. Yet it feels like there is a danger of watching the Magician’s left hand and being dazzled by it– the hand that has miraculously produced the Tobin tax from its sleeve and is twisting it round and round. Meanwhile we are being tricked and distracted from what the right hand is doing. Or not doing. The right hand is not juggling ideas of transparency, accountability and democracy in the global economy or the ever-growing evidence linking the effects of the global economy to health.

Andy.guise@lshtm.ac.uk

by Taavi Tillmann

The EG4Health campaign has seen many developments with UK medical students over the past months, which I want to share in this blog entry.
Read more…

In this newsletter from EG4H…

• Tobin or not Tobin? That is the question… – Find out why the Tobin Tax has resurfaced as a way to respond to the crisis in funding for the health MDGs
• $10 billion financing gap to scale up the health MDGs – read about the data behind the numbers
• The IMF needs more than guidance and support: it is time for a complete overhaul – Why EG4H is against a Global Economic Council for the IMF
• Just Out! Links to the latest writing and events on economic governance for health Read more…

In this newsletter from EG4H…

Why the IMF and Fiscal Policy is so central to the Health MDGs: A report on why, more than ever, the International Monetary Fund’s macro-economic and fiscal policy are issues that the public health community must understand and engage with.

‘As kingfishers catch fire, dragonflies draw flame…’: Learn how our global health institutions are beginning to burn as the economic crisis bites.

High Level Taskforce keeps their data under wraps – Find out why the High Level Taskforce won’t publish its data on financing gaps.

Just Out! Links to the latest writing and events on economic governance for health

Are you interested in helping us get the word out about the importance of economic governance for health? Read more…

In this newsletter from EG4H…

•    Equitable and sustainable economic governance: for health, for all: EG4H is seeking partners for a consensus statement on global economic governance and its impact on health.
•    A Private Equity Fund for African health systems: The Gates Foundation and the dangers of their support for private sector involvement in healthcare
•    Can the ‘Taskforce’ pull the MDG rabbit out of the hat?: A high level taskforce reports on financing for health and the likelihood of meeting the MDGs
•    Just Out! Links to the latest writing and events on economic governance for health

Are you interested in helping us get the word out about the importance of economic governance for health? Read more…

In this newsletter from EG4H…

• WHO dropped from the Biomedical ball
• Civil Society meet in Johannesburg for a consultation on the Taskforce for Innovative Financing
• Just out! Links to the latest writing and events on economic governance for health

Are you interested in helping us get the word out about the importance of economic governance for health? Read more…

In this newsletter from EG4H…

• A decade of health funding from the World Bank – but to what end for the poor? Damning findings from the World Bank’s Independent Evaluation Group
• WHO Director Margaret Chan’s withering critique of liberal economic governance and its impact on health
• ‘Just out’ links to the latest global economic news and events

Are you interested in helping us get the word out about the importance of economic governance for health?

Would you like to do more and join our active campaign outreach network? Read more…

Newsletter 4, 24th April 2009

In this newsletter from EG4H…

* Call for ‘outreachers’ to help spread our economic message
* Global social protection and health
* The private sector and health provision debate rolls on…
* Just out! Links to the latest briefs, reports, and events on economic governance for health

Call for ‘outreachers’ to spread the message of Economic Governance for Health
Are you interested in helping us get the word out about the importance of economic governance for health? Read more…