European Commission President, José Manuel Barroso, in supporting the financial transactions tax (that would take a small cut on every trade in the financial sector, and could reduce the short termism that undermines sustainable business), points out that tax payers have contributed more than €4,000bn in guarantees to the banking sector to support it through the crisis. Now is the time, he argues, for the industry to repay its debt. "It's a question of fairness," he said. "It is time for the financial sector to make a contribution back to society."
Barosso's moral compass puts him squarely in the camp of Occupy Wall Street, although one suspects unintentionally and with some measure of discomfort. The self-proclaimed "leaderless resistance movement" is at one with Barroso in asserting their common cause, "that we are the 99 per cent that will no longer tolerate the greed and corruption of the 1 per cent." Moreover, whilst Barosso might normally claim the high ground in being a pragmatic, policy-focused sort of guy, he (and others) should listen carefully to, and might just learn from, the movement's policy specifics.
Occupy Wall Street's proposed list of eight demands is a work-in-progress developed through the best 'open innovation' process that money can't buy. Prudent banking is number one on the list, the separation of investment and commercial banking functions to protect retail, that is your and my, deposits. Remove the angry language, and the proposal is essentially the same as those advocated by the UK's Independent Comission on Banking, reported recently in the 'Vickers Report'. Prosecuting those in the investment community who broke the law comes in number two, hardly a radical view in theory, although in practice more of challenge than one might like as banks seek to do backroom deals to settle mortgage mis-selling.
Reversing the U.S. Supreme Court decision allowing businesses to contribute as much as they want to political campaigns comes in number three (corporate influence is also the topic of proposals six and seven). Again, policies in this area are hardly a brain teaser for anyone concerned with the corporate capture of the U.S. political process. Little England, albeit at a wee scale, increasingly suffers from the same affliction, with the recent Bureau of Journalism report revealing the dominance of the City in the roll-call of Conservative Party donors.
Fulfilling the wishes of the investment community's greatest guru, Warren Buffett, is the so-called 'anti-capitalist's' fourth demand. Demanded here is a Buffett Tax to ensure that rich individuals and corporations pay as much taxes as Joe Worker, not the current business-as-usual as recent research has highlighted. The fifth demand calls for the reform of the financial market's regulator, the Securities and Exchange Commission, to reduce bias, political interference, conflicts of interest and to ensure adequate competencies and policy instruments. Although perhaps a little loosely framed, it would be hard for any self-respecting investor, let alone a correct-thinking politician or a civil activist, wanting anything less or different.
And the eighth and final demand is for the corporation's right to be treated as a 'person' in the eyes of the law to be repudiated, a long-standing concern of civil activists regarding what they see as the misuse by business of the U.S. Constitution (those wanting to understand this better to see the relevant section of the film The Corporation).
Anyone concerned with responsible business and sustainability should take note of these demands. The bottom line is that they make a lot of sense, whilst lacking the slickness of corporate or Oxfam-style branding, language and graphics. Resetting the behavior of the financial community, effective regulatory oversight, separation of the political process from corporate interests, and the application of the law of the land are hardly contentious propositions. In fact, they are pre-requisites to advancing private investment in the transition to a sustainable economy and public policies that reward innovation and leadership rather than protecting incumbent businesses.
So who is listening to the folks camping out in downtown Manhattan? Barroso, one suspects, is not focused on these demands, although he should be as Europe struggles to protect itself from traders seeking to short not just its debt but its very future. President Obama, likewise, should call out the root cause of his shortcomings at the polls, but is otherwise engaged in retaining Wall Street support for his re-election campaign. Ed Miliband, the UK's Labour Party leader, should be interested, but in seeking to position himself in the centre, he might ironically see the eight point proposals as too close for comfort to his conference speech on 'asset stripping' businesses. France's President Sarkozy has championed some interesting causes, including the financial transaction tax in his role as chair of the G20, but his political star may in any case be in the acendency. And the more recently, empowered BRICS leadership, Hu, Putin, Rousseff, Singh and Zuma, appear to have little appetite for any fundamental reform agenda of either financial markets or the international corporate community at a time when their nations' future dominance of these economic arenas seems increasingly assured.
And what of us, informed and active, democracy-loving citizens? Surely we are the ultimate global driver for change. Angry perhaps, but citizens are not yet joined at the hip in sufficient numbers with an agenda to match. And so far, no serious political alternative has emerged to harness such anger at the ballot box, to provide democracy's way of asserting Darwin's edict that only the fittest, most able to go the long distance, should survive. Time will tell if such a political process will emerge, democratic or otherwise.
Occupy Wall Street, meanwhile, and its emergent look-a-likes in other countries, should be seen as an innovation hub, working at the critical upstream nexus of politics and economics. Far from ridiculing and rejecting either its open process or its trenchant policy recommendations, progressive business and political leaders should welcome both as investments in tomorrow's sustainable economy.
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