–Novels and scenarios about post-apocalypse are typically dystopian when it comes to climate change: Nothing will be as it was before. Or if you prefer, it will be business as usual only in so far as much more greed, nasty and brutish, gangs, urban decay and vistas of desolation.
Let’s push further and assume post-apocalypse will be unimaginably different and worse.
Even so, it’s that “nothing will be as it was” that bothers me. For the way things are today includes what the people do not imagine–let alone know to be the case. In what way, specifically, is it good or bad when the apocalypse rids us of what a few in the world know to be the case anyway?
–An example, and one the reader can relate to: tax havens. Once you have an inkling of what to look for, the numbers loom massive.
In one year alone (2016), multinational corporations (MNCs) were estimated to have shifted USD 1 trillion of profits to tax havens, with an estimated USD 200-300 billion in lost tax revenue worldwide. (The Cayman Islands, Luxembourg, Bermuda, Hong Kong and the Netherlands are among the most important tax havens.) Another study estimates multinational enterprises shift close to 40% of their profits to tax havens globally. As for regions, the main European banks are reckoned to have booked EUR 20 billion (close to 15% of their total profits) in tax havens. In Germany, by way of one country, MNCs there are said to have shifted corporate profits of some EUR 19 billion to tax havens, with an estimated tax revenue loss of roughly EUR 5.7 billion.
Now, post-apocalypse. The Cayman Islands, Bermuda, Hong Kong and the Netherlands? Under water. MNCs? They should be so lucky! Tax havens and forgone tax revenues? After the apocalypse, what taxes?
–These points bode forth an interesting set of policy issues. For it must also be understood that the bad of tax havens, pre-apocalypse, is not the bad post-apocalypse.
In particular, why ever are we spending time and resources on reducing the use of tax havens when all our energies—all our political will—should be directed to averting the climate-induced apocalypse? From this perspective, today’s tax havens are visibly part of opportunity costs of deadly climate inaction. Reducing tax havens is worse than meaningless unless the generated revenues are directed to mitigating the impacts of climate change–and even then it could be too little too late.
–Or is it too little too late in quite another sense? For surely part of being in the apocalypse means we have to manage global climate change far better everywhere than we (can) manage tax havens here or there, and now. If so, we are on the losing end either way: managing (or not) tax havens won’t get us to the climate change mitigation needed. . .
—Unless, of course, we imagine that getting rid of these tax sinkholes for the rich and already-undeserving–the enemy of both populist and cosmopolitan citizenship–are among the few things that are truly urgent, like climate change.
Something else urgent along with climate change?! In this world, urgency is a plural noun. “Urgent” can never modify a set with one truly urgent only, no matter how many times you insist, “Uncertainty is not our friend here!” It’s more complicated than that.
Aliprandi, G., M. Baraké, and P-E Chouc (2021). Have European Banks Left Tax Havens? Evidence from country-by-country data (Report 2). The EU Tax Observatory. Paris School of Economics.
Ciuriak, D. and A.J. Eurallyah (2021). Taxing Capital In The Age Of Intangibles. Discussion Paper, Ciuriak Consulting. (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3920763)
Fuest, C., F. Hugger, and F. Neumeier (2021). Corporate Profit Shifting and the Role of Tax Havens: Evidence from German Country-By-Country Reporting Data. CESifo Working Paper No. 8838. Munich Society for the Promotion of Economic Research, Munich.
Garcia-Bernardo, J., and P. Janský (2021). Profit Shifting of Multinational Corporations Worldwide. ICTD Working Paper 119, Institute of Development Studies, Brighton UK.