What is immoral about the inequality of world wealth?

General German newspaper for Romania

Human societies are based on a simple principle: the public infrastructure - schools, hospitals, etc. - is financed by taxes. But tens of thousands have created a parallel world in which these rules no longer apply. What makes some tax evaders criminal is done by others on a grand scale - often without breaking the law! Not only does the space between the paragraphs offer an opportunity for this, but also the possibility of influencing legal structures with money. No, this is not about organized crime. Or maybe yes?

The man who opens our eyes to what sounds like a conspiracy theory is called Thomas Pogge. A philosopher who does not float in castles of clouds, but who studied at the two most renowned universities in the USA - Harvard and Yale - or teaches today, and who underpins his thesis with facts and figures. The Friedrich Ebert Foundation has succeeded in sending the German professor, founder of the Global Justice Program, member of the Norwegian Academy of Sciences and chairman of the organization Academics Against Poverty (ASAP), to Bucharest for the lecture series "Sustainable Romania" bring. Taking the Panama scandal as an occasion, the question arises: Is there justice on a global level?

Nicely colored poverty statistics

"We have a huge deficit in human rights, which can clearly be traced back to the current structure of the world order," is his thesis. Let us look at a few figures from official statistics: 450 million people - much more than in the First and Second World Wars combined (with 17 and 60 million deaths, respectively) - died from poverty-related diseases between 1990 and 2015. Not counting the cases in which a lack of medical care for non-poverty-related diseases also leads to earlier death. One third of all human deaths are due to poverty. The global income distribution for 2015 shows: 43 percent of world income goes to just five percent of the world's population. One percent of the world's population owns 50.4 percent of the world's wealth - more than half for the first time since 2015! Only 62 people in the top billionaire segment collectively own as much as the entire bottom half of the world's population. The shocking figures are usually countered by two arguments: there is progress in the fight against poverty, statistics show a decline in poverty. But the good news is embellished, criticizes Pogge harshly. The increasing trend towards world hunger recorded in earlier years, which later suddenly falls, is due to a redefinition of the term malnutrition.

The new definition: Malnourished is someone who consumes less energy than the minimum required for a sedentary lifestyle for over a year. The weak points are obvious: 1. Only calories count, not essential minerals, vitamins or proteins. 2. Food is the only thing that counts, but most starving people have problems with absorption. 3. Hardly a poor person can afford to sit down, many work hard physically. 4. The most ironic part is the addition, "for over a year"! Because even a healthy adult dies after about 60 days if he stops eating. But whoever dies before a year is up is not included in the statistics ... Another paradox: As a result, there cannot be a hungry rickshaw driver. Because if he only slightly exceeds the minimum calorie intake according to the above definition, he is not affected by hunger - nevertheless he dies from it before a year has elapsed because the energy intake is insufficient for a physically active person.

The engine that bleeds poor countries to death

The second counter-argument is: Poverty develops differently in different countries, so the global system cannot be to blame, it must be due to national factors. “At least that's what you read in business magazines every week,” criticizes Pogge. Why this cannot be an argument is made clear by an analogy: a teacher can have good and bad students, because for some he has a motivating effect or has the right methods, others do not get along so well with his style or are demotivated. If you change him, the performance profile of the same students can change. “Of course, local factors play a role, but this does not mean that global factors can therefore be ruled out,” explains Pogge.
Let's take a look at the causes:

1. Pollution: Global rules allow rich countries to dump their garbage in poor countries.
2. Ownership: Government persons are allowed to sell a country's natural resources abroad! Governments are put under pressure to do this, countries are exploited.
3. Labor exploitation: International corporations benefit from countries with cheap labor, but make a profit in others, so that the country with the labor does not even benefit from taxes.
4. Tax evasion, money laundering, illegal financial flows: Rich people in poor countries often pay no taxes at all: They place their money in tax havens and anonymous accounts abroad.
A parallel, secret underground financial system is causing - and continuing to drive - global inequality. Gigantic amounts of money are flowing into tax havens from developing countries. This is the mechanism that makes the rich richer and bleeds poor countries to death, the engine of global injustice. The amount of development aid they receive from the affluent countries is ridiculous in comparison.

Immoral, but often "legal"

Injustice cries out to heaven. Nevertheless, the methods are not necessarily illegal if no specific law is violated. An example: An international group produces its goods in India, but sells them in South Africa. In order to pay the lowest possible taxes, he opens a branch on the Cay-man Islands, which buys the goods from India - cheaply, of course, so that there is no profit in India. Then it sells at a high price to South Africa so that there is no profit there either. Only the branch in the tax haven - a one-man office with a fax machine! The goods, on the other hand, are shipped directly from India to South Africa.

Another example: You acquire a company in Africa, but it is first arranged to sell its name to another company belonging to the buyer in a tax haven. He then leases the name back for the African company and pays large sums for it every month. The purpose is to keep the profit for the company in Africa small and to redirect it to the tax haven.
In this way, two percent of US assets are placed in other countries, beyond the control of domestic tax authorities, explains Pogge. For Europe it is 8 percent. But for Africa and the Middle East it is a gigantic 31 percent, for Latin America 28 percent! If this money were available for the infrastructure of the countries, the poverty statistics would look different.

Corruption under another name

“Under the current rules of the world economy, massive human rights violations occur,” concludes Thomas Pogge. Why is nothing being done about it when, in theory, everyone wants the developing countries to be better off? In technical terms, the answer is: Regulatory Capture. This denotes the phenomenon that, instead of acting in the interests of society, a government body gives preference to the commercial or special interests of a particular interest group. Lobbying is carried out for this purpose - a form of lobbying in politics and society, in which the executive and legislative branches are to be influenced and public opinion is influenced by means of the mass media. Lobbyist activities are officially called political advice, public affairs or political communication. In reality, however, this is nothing more than undermining democracy and the rule of law for personal gain. Corruption!

In the USA, entire branches of the company are concerned with collecting the information necessary for lobbying: who decides what, when and where? Your goal is the US Congress. And of course the strongest have the edge in this game - the ones with the most money. What do you want to achieve? For example, that a law is passed that reduces the tax burden for a certain interest group. As an example, Pogge cites the hedge fund managers: "They have enormous salaries, and if only 20 of them get together and each gives a million, they have enough to influence Congress." Bingo! “In fact, there is a special income tax in the US only for hedge fund managers. Instead of 39.6 percent, like other high-income earners, they only pay 20. "

Another example is the American Jobs Creation Act, which introduces a tax-free day disguised as a “business-promoting measure”. This helps multinational corporations to transfer their useless sums of money parked in tax havens to the USA for free! If you observe the flow of money on that day and know the amount that goes to Congress through lobbying, you can calculate the return rate for a dollar invested in lobbying: It's a whopping 220 dollars, according to Prof. Lawrence Lessig in his book “Republic , Lost “(free as PDF at http: //republic.lessig. Org /)!

“Lobbying has grown exponentially in the last decade,” warn Raquel Alexander, Susan Scholz and Stephen Massa in the study “Measuring Rates of Return for Lobbying Expenditures”. How strong the industry is now is illustrated by a strategy that the investment consultancy Strategas devised to make stable money on the stock market: It is recommended that you always rely on the 50 largest lobbying firms in the world. The chart illustrates the success: The top curve shows the increase in the Strategas Lobbying Index compared to the general S&P 500 index (500 largest companies with stocks on NASDAQ or NYSE) and the overall lobbying index for 2001-2011. Lobbying is no longer only practiced for national laws, but also for the purpose of influencing international rules. And because the US is considered to be the strongest player in the negotiations, the US government is the lobbyists' top priority.

Buy the world

The phenomenon in itself is not new. But globalization takes on a completely different dimension because there is no democratic control, explains Pogge. At the national level, citizens can protest if they disagree with the machinations of a company. This mechanism is failing at the global level. Actions and actors are not limited to one country, and it is unclear who is responsible for a grievance. In addition, global negotiations are often secret. And anyway, where should you demonstrate?
Immoral rules are also easier to defend on a global level: We cannot afford to be moral because we are in competition with the Chinese or the Russians, the argument goes. So the engine continues to run until it overheats: the super-rich are getting richer and richer, the poor cannot get out of the trap. Social explosive for riots, wars, terrorism - other crimes against humanity. The solution: Abolish tax havens, transparency in the global market, an end to numbered accounts and banking secrets. Financial institutions would have to be obliged to report their customers to the tax authorities of the respective country. It sounds as simple as a resounding slap in the face. But who holds out his cheek, who raises his hand?