The Robin Hood Tax has been a fascinating example of emotion defeating logic and fact. As it invariably will.
I’m a Conservative, so I’m instinctively inclined not to support increases in tax, let alone new taxes. That’s not to say I don’t recognise the need for tax and (some) of what it funds. But the support the Robin Hood Tax is attracting surprises me. Well, actually, it doesn’t.
I’m not in the least bit surprised because I can see the emotional appeal. Let’s have a tiny tax on nasty people that raises lots of money for good things. Who can possibly disagree?
Many have. Pointing out that such a tax would require unprecedented international co-operation to work and if only a few countries didn’t participate those levying the tax would be at an economic disadvantage. Or that the hundreds of billions of pounds the tax would raise would have to come from somewhere, this isn’t new money (despite the assertions of actor/economist Bill Nighy) and however banks deal with it the effects will be felt.
But these sorts of arguments will never defeat the raw emotional appeal of hurting the evil bankers. And, let’s be fair, that is the point. It is presented as a way to get back at bankers without causing pain elsewhere. It’s about vengeance.
So why stop with 0.005%? If part of the argument is that it’s so small they won’t notice then why not double it. Then you raise twice as much. In fact, let’s go for 1% – that’s still tiny but you’d raise 200 times more and might hurt those evil evil bankers.
The thing I dislike about the whole campaign is the inconsistency of it. On one hand it’s something that will make bankers pay, on the other they won’t even notice. On one hand it won’t affect the economy or markets, but on the other it will take hundreds or billions of pounds out of the markets.
But this goes unnoticed because of some clever labelling. Associating it with Robin Hood, and the idea of taking from the undeserving and giving to the needy is brilliant, (even if it does overlook that Robin Hood was really about fighting an oppressive state that was eroding civil liberties, they were fighting the same John that was forced to sign Magna Carta at Runnymede). It means that it’s not just economists and politicians talking about it, but now celebrities can jump on the bandwagon. They couldn’t do that if it were the ‘The Genghis Khan Tax’ could they?
It’s a bad idea. But great marketing.