Opinion Forum

UN Seeks Global Taxes; Obama Admin Says Bend Over

November 15th, 2010

It seems as though the United States needs more problems.

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There has been a demand for a global tax to fund the heroic battle against the horrors of global warming climate change species endangerment.

The demand comes from the Secretary-General’s High-level Advisory Group on Climate Change Financing, which was organized following last year’s UN Climate Change Conference in Copenhagen. Among the panelists recommending global taxes are George Soros, the financier of socialist change, and Larry Summers, President Obama’s economic advisor.

The suggested amount of the global tax would only be 100 billion dollars when implemented (the amount “pledged at last year’s Copenhagen Summit to help poor countries cope with the effects of climate change”), small change perhaps to some, but it would increase substantially thereafter mainly through carbon and transactions taxes. Obviously, according to this splendid article in Salon, we must put Al Gore science back into the political process, lest we be barbaric. Prime Minister Zapatero of Spain has asked that we all help to create green jobs in Spain and elsewhere “as a way out of the current economic crisis;” apparently the theory is that since the market won’t create enough of them, they are the way to economic prosperity.

As Madrid economics professor Dr. Gabriel Calzada exposed, the “green” industry in Spain saw their only hope in the U.S. (Uncle Sucker?) coming to the rescue, keeping the bubble filled with transferred billions. Calzada was decried as “unpatriotic” by Spain’s renewables industry and communist-affiliated trade union — not for being wrong, but for letting the cat out of the bag.

Implementation of this “science friendly” idea would create all sorts of opportunities for the slippery slope effect to click in for more of the same as well as for other purposes. At the G20 summit in Korea, a global “Robin Hood” tax was proposed so that “rich” nations could help “poor” nations, doubtless “scientifically.” The World Health Organization recently urged a similar objective. Not to be outdone in efforts to spend other folk’s money,

French, German and British leaders have each endorsed one or more ideas for international taxation, including a global financial transaction tax or “Tobin Tax” as it is more commonly known. The G-8 and the International Monetary Fund, not wanting to be left out of the global tax game, are writing proposals of their own. With Summers, we can now add to that list a high ranking Obama administration official.

International taxation is “no longer merely an option,” says French Foreign Minister Bernard Kouchner. He argues it’s only a matter of time before the UN implements a tax system.

Unless the U.S. Constitution has recently been tossed or substantially rewritten, there is no way for the U.N. or other international bodies to impose that sort of thing on the United States directly. This does not mean that we are immune. Unfortunately, there are some ways for it to be done indirectly. Some would require the complicity of the President and the Congress and only a few would not. As noted here, there is presently very little chance of any significant global tax scheme being accepted by the United States due to constitutional restrictions, the economic situation and political realities.

While it may be a flight of fancy now, global taxation has been strongly and consistently advocated by the UN, the WHO, several European countries and others. President Obama has supported the concept and in 2008 sponsored the Global Poverty Act (S 2433) to require U.S. compliance with the Millennium Development Goals. Vice President Biden, then chairman of the Senate Foreign Relations Committee, tried to get it passed but failed. More recently, in December of 2009, soon-to-be-no-longer Speaker of the House Nancy Pelosi endorsed the idea of a global tax on stock trades to provide funding for additional stimulus packages.

It seemed almost a matter of pride for some in the Are you Serious Congress to ignore the Constitution when dealing with legislation, under the assumption that the federal government can do whatever it pleases. We saw that, for example, when ObamaCare was before the Congress; yet it passed. The mandatory health insurance provisions are now being litigated and I would be quite surprised were they not eventually to fall — but not before creating substantial business uncertainty and consequent economic difficulties.

Over time, resistance to a global tax scheme may diminish to the point that just a small and economically benign tax gets by. Precedent having been established, it would become increasingly difficult to prevent the process from reproducing itself for increasingly harmful taxes. Legislative expansions of the Commerce Clause, not terribly significant in themselves at first, have over the past seventy-five years distended it rather grossly.

Articles I, Section 7 of the Constitution provides,

All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.

Article I, Section 8 provides,

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States.

Article I, Section 9 provides, “No Tax or Duty shall be laid on Articles exported from any State.” Its purpose has been said to be

To prohibit discrimination against any states or regions, Congress cannot tax goods exported from a state to foreign countries or those that move between states. (emphasis added)

Further, under the same Article and Section,

No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.

The Sixteenth amendment authorized an income tax:

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

And that’s about it.

Hence, no United States taxes can be imposed on goods exported to any foreign country, no non-uniform taxes can be imposed on any state other than via income taxes and all legislation to raise such revenues must originate in the House of Representatives, soon to be under the control of a reasonably conservative or at least Republican majority. New excise taxes on fuel, electricity, etc? Not with the new Congress, unless some individual states impose them on their own residents which seems equally unlikely. It seems likely that future appropriations for funding by the United States of the U.N. may already be in trouble, and to increase them would be very difficult. Ditto funds appropriated to federal agencies and departments, and ways exist narrowly to restrict such appropriations. True, under Article II, Section 2, the President has the power,

by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur. . . .

Were the President to present to the Senate which convenes in January a treaty authorizing the collection of such revenues it probably would not receive the consent of the requisite numbers of senators; even if it did, it is very questionable whether it would be compliant with Article I and the Sixteenth Amendment quoted above. Senate Resolution 461, introduced by recently re-elected Senator David Vitter, R. La., on March 10, 2010, would put the Senate on record against any global tax scheme. It was referred to committee and has not yet progressed; maybe that sort of resolution should be looked into by the new Senate come January.

However, there are still ways the global tax envisioned by Secretary General Ban Ki-moon’s United Nations and others might be implemented. The U.N. Advisory Group offers some options

for governments to get the required $100 billion. “Governments may prefer to increase budget contributions,” its authors helpfully suggest, until such time as new domestic or international taxes can be imposed and collected. It goes on to recommend a “carbon export optimization tax,” and levies on international aviation and shipping including taxes on jet fuel and passenger tickets for international flights.

Other possibilities include royalties from fossil fuel extraction, and taxes on the use of electricity. Finally, there is the need, according to the UN, for a “global financial transaction tax,” that would require “international coordination” and “international implementation.” This is UN-speak for a global tax collecting agency.

Beyond these nifty ideas, which could easily discriminate against some states, foreign governments could increase their own taxes imposed on imported goods, many of which still come from the United States; this would have to be done very carefully if trade wars were to be avoided. The added funds so collected could be diverted to the U.N. They could also impose additional taxes on U.S. entities doing business in foreign countries, although if high enough that could cause some United States companies to rethink outsourcing and other ways of operating outside the United States; that might well be a good thing for the U.S. economy.

The United States has done more than her “fair share” of aiding less fortunate countries, and far from thereby winning the minds and hearts of their populations has increasingly been disparaged. She has maintained forces abroad, making it easier for some countries to have massive social programs based on the funding they would otherwise have had to spend on self defense. In some ways, she has done them ill by promoting an entitlements culture which, once started is almost impossible to stop. See Greece, France (and increasingly California and other states where that culture has gone berserk).

Rather than chase the fading ghosts of global warming and other phantoms, the new Congress should say “whoa” and reconsider the funding on which the country already splurges; to do otherwise would be pernicious. It would be no less so to let even a minimal global tax sneak under the radar. I facetiously suggested here that the United Nations be relocated to Luputa, Haiti or Somalia but that probably wouldn’t work, despite the benefits thereby provided to the poor. In any event, the new Congress should give careful and detailed consideration to whether even the present (high) level of United Nations and foreign aid funding provided by the United States should continue. To do otherwise would be, to the extent such a thing is possible, even more inconsistent with United States interests than is the present Obama Administration itself.

(This article was also posted at Dan Miller’s Blog.)

Articles written by Dan Miller
Tags: Congress, Constitution, global taxes, global warming, treaties, UN
Categories: Law, News, Politics | Comments (5) | Home

5 Responses to “UN Seeks Global Taxes; Obama Admin Says Bend Over”

Clarissa | November 16th, 2010 at 12:58 am

I’m trying very hard to understand this issue that everybody in this country has with the possible tax raises. I know that those tax raises are not even likely to happen. The only thing that Obama’s administration wants to do is repeal the tax cut for the highest earners in the country, right? At this moment, my husband and I will definitely qualify as that group in the population whose taxes President Obama wants to raise through repealing Bush’s tax cuts. And I have to say, we welcome that. As the representatives of the group who has reaped the greatest benefits from this society, we don’t mind giving back more than others. Why should we be worried?

Brian | November 16th, 2010 at 5:37 am

Clarissa, if you wish to “give back,” as you say, then by all means, go ahead and “donate” extra taxes to the IRS, even if Bush’s tax cuts are renewed at all levels. You have no ethical authority to impose that tax, nor that moral idea, on anyone else. However, I would point out that you and any sufficiently large group of like-minded, economically ignorant people certainly have the power to do it.

What you do not comprehend is that most of the people in that tax bracket are small business owners, whose businesses will be hurt by that tax increase. That means rising prices for consumers, and the specter of lay-offs for the employees of those small businesses.

It is a logically absurd notion that you should give back. People of your intelligence and means derive little benefit from anything the government does, excepting clearly identified authorities as enumerated in the constitution. There is little or nothing the government can “do for you” that you cannot do, and probably already do, for yourself.

In contrast, the people that should “give back” the most are those that generally (though certainly not exclusively) benefit the most from government “largess” and have the lowest means (economic and mental), and it is these beneficiaries that will never give back what has been stolen on their behalf.

It is not government, to any large extent, that makes your wealth and income possible, it is freedom from government that makes it possible. People in Europe do not live in small apartments and drive small cars because they want to, it is because they largely cannot afford anything else. It isn’t uncommon in Europe to see hamburger at $15/#. Are the cattlemen in Europe greedier than cattlemen in the states? Are Royal Dutch and Chevron’s corporate officers greedier in Europe than they are in the states? Or perhaps Europeans simply enjoy paying higher prices for commodities than we do in America. Somehow, I think that’s probably not the case.

No, the answer is higher taxes and more onerous regulation, coupled with even crazier protectionism than what we engage in here.

Robin Hood did not steal from the rich and give to the poor. He took, by force of arms, from the government what the government had stolen, by force of arms, from the people.

Tom Carter | November 16th, 2010 at 6:11 am

Clarissa, I don’t think anyone, regardless of nationality, likes paying taxes. That’s always been true — just look at the status (and sometimes the fate) of tax collectors throughout history. Having said that, I think it’s true that Americans in particular have a special dislike for taxes that’s grounded in our history and economic philosophy. Many see taxes as a negative factor in economic growth and, in some circumstances, as an unacceptable tool for the redistribution of wealth. We also have historical evidence (Kennedy and Reagan in particular) of tax cuts generating more revenue, although that’s hard to pin down and somewhat controversial. The bottom line is while the U.S. is an offspring of Europe, we’re different in many ways, with our opinions about taxes and the role of government being high on the list.

Personally, I favor letting the Bush tax cuts for the wealthiest expire, and I’d feel the same way about all of them except for the current condition of the economy. I don’t like taxes any more than anyone else, but we simply cannot dig our way out of the current catastrophic problem of deficits and debt without more taxes and less spending.

It’s also worth noting that almost 50 percent of Americans with income pay no federal income tax at all. In many cases, when there are tax cuts or adjustments they actually receive some cash as though they pay taxes. I’d like to see that situation change, too, with everyone paying at least some share of the tax burden.

Tom Carter | November 16th, 2010 at 6:18 am

Americans are a bit sensitive about the UN, for what I think are justifiable reasons. We pay 22 percent of the overall cost of keeping the UN alive (that’s the capped maximum amount), 27 percent of UN peacekeeping costs, and additional amounts for UN special organizations. We also host the UN in New York, which generates additional net cost. In return, we have an absurd collection of thugocracies and kleptocracies constantly heaping scorn on us, both in the General Assembly and in special bodies, and we watch pretty much helplessly as they revile and do everything possible to undermine Israel, one of our closest allies. We have more sway as a permanent member of the Security Council, of course, but that organ is anachronistic in terms of membership and usually more of a hindrance than a help to the U.S.

We also tend to take sovereignty very seriously (especially when it’s ours), and we’re suspicious of and very reluctant to get involved in anything that smacks of “world government.” In that sense, we’re a bit like the UK in it’s skepticism about the EU (which is becoming more and more well-founded).

So, if you want to generate a “perfect storm” all you have to do is suggest that the UN might levy a tax on us and somehow (I have no idea how) force us to pay it. The most that could be done, as Dan explains, would be additional voluntary contributions or some kind of treaty that involved additional funds, and in the present political and economic circumstances there’s zero chance that Congress (and the people) would let it happen. Also, the UN itself might what to reflect on the story of the goose and the golden eggs.

Of course, none of this applies to the far left in American. They’re against almost everything most Americans favor and for almost everything most Americans are against. In particular, they get the vapors when anyone praises the idea of “world government” and points out that the U.S. is an especially vile country.

Dan Miller | November 16th, 2010 at 7:17 am

The article was not about whether taxes per se should be raised or lowered. It dealt with global taxes, advocated by many but currently unlikely to be imposed anytime soon in the US, and the constitutional issues their attempted imposition would involve. I think the constitutional issues are quite substantial, for the reasons stated.

I agree with Brian that regardless of any fairness/unfairness in raising the taxes of the “rich” to help the “poor,” doing so would further degrade the private economy — that’s where most of the economically productive jobs are to be had. I understand that it would be particularly harmful to the small business sector.

Before I retired from the private practice of law in 1996, I worked (with very rare exceptions) for corporate clients, some big and some small. Some were run by “rich” men and some not. Regardless of size, their principal objective was to make money to preserve and to expand their businesses. The “rich” guys lived reasonably well personally and didn’t need more money to continue to do so. I remember several CEOs of large corporate clients who always flew coach rather than first class or in corporate aircraft. They generally plowed substantial profits back into their businesses. That increased their personal power but also increased their ability to hire people; generally their motives were not altruistic but that did not lessen the productive economic impact of what they did.

Rather than penalize the “rich” for their success, I would prefer substantial reductions in corporate taxes and regulatory uncertainty as ways to stimulate the economy. With few exceptions, corporate taxes are taken from the pot available for stock dividends and the dividends are themselves subject to personal income tax. With some limitations, corporate profits not distributed as dividends need to be reinvested in corporate activities lest they be subject to additional taxes. Some of those corporate activities are economically productive and useful; some amount to waste and are less so. Some governmental activities are also economically productive and some others are necessary for national defense and other reasons. However, some also fall into the waste category.

Solid economic thinking rather than “feel good” emotional reactions about how best to stimulate the economy is needed. “Rich” people (apparently meaning those who earn more than $250,000 per year) are neither good nor bad per se and the same is true of the “deserving poor.” It is always easy, and often politically useful, to stimulate disdain for target groups. That does not make it either economically beneficial or otherwise “good.”