To tax or not to tax: The relationship between taxation and welfare

pictureAs a newly arrived Dane in Ireland, I have found myself highly puzzled by the public resistance and mass demonstrations across the country against the recent introduction of water taxes. The unwillingness to pay for a utility is unfamiliar to Danish citizens, recognising the fact that the provision of clean drinkable water, as well as maintenance and improvement of network infrastructures, all comes with a price tag. Danes are one of the most “taxed” in the world, with top marginal wage taxes of up to 60-70 % (Kleven, 2014) of income. Despite this, the Danes are also labelled the happiest people in the world. So the high tax rates do not seem to bother the Danish taxpayers. How can that be? In this article, UCD politics student, Ateebah Chaudhry, argues that the difference between the Danish and Irish attitude towards taxation explains the different trajectories of their social states.

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Resilience and EU Foreign Policy: The Promise of Justice?

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The appearance of ‘resilience’ as a core leitmotif within the EU Global Strategy (EUGS) has been a significant focus of analytical interest in recent months (Wagner and Anholt 2016; Juncos 2016). Featuring several dozen times within the Union’s strategy statement and frequently linked to the broader concept of ‘principled pragmatism’, the concept has come in for some criticism that it represents a retreat in European ambition. Meanwhile, it is understood that the European institutions are anxious to put flesh on the ‘resilience’ bones of the EUGS and to look at ways in which the concept may be operationalised and how it can serve the goal of a credible, coherent and consistent foreign, security and defence policy. The aim of this post, is to suggest that far from representing a collapse of European ambition, resilience just may be an opportunity to take an enormous step forward in EU foreign policy, and one which may serve the cause of an overarching concept of global justice.

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The truly stagnant class in American society are young men from low-income backgrounds

Version 2In this blog post @ucdpolitics student, Muireann O’Shea, examines why America tends to look back upon the past with nostalgia, and to what extent this is bound up with perceptions of social mobility and the America Dream. The period of 1950 to 1980 saw the lowest income inequality ever in modern American history, with the top decile taking 30 to 35% of US National Income, which has increased to over 50% today (Piketty, 2014, p. 294). Economic policy in post World War II America used an increase in minimum wage to increase wages at the lower end of scale, but by the end of the 1970s, this was replaced by stark increases in pay at the very top of the income scale, leading to an “explosion of inequality” (Piketty, 2014, pp. 310-4). American minimum wage peaked in 1969 at $1.60, or $10.10 in 2013 dollars, and unemployment was below 4% (Piketty, 2014, p. 309). Yet by the end of the 1970’s rates of upward social mobility had stalled, and it has barely moved since (Surowiecki, 2014).

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The chasm of inequality: Why is the middle class shrinking?

AdamIn PewResearchCenter’s report (2015:1) they argue that lower and upper-income U.S households now outnumber the middle for the first time in decades. Despite financial gains the middle class has lost their majority income share to the upper classes and “the share of American adults living in middle-income households have fallen 61% in 1971 to 50% in 2015” (PewResearchCenter, 2015:1). However, this is not one isolated case as recent evidence suggests that Britain’s middle class is “being swiftly eroded by a new and disturbing economic reality”(McLaren,2013) with nearly 60% of Brits “defining themselves as working class” (McLaren,2013). @ucdpolitics student, Adam Costello argues that this is a disturbing trend, and that the decline of the middle class raises one very important question, why is it happening?

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Legal Discrimination: How Double Taxation Treaties Discriminate against Lower-Income Countries

HannahMultinational treaty shopping and tax avoidance is commonplace throughout the world, particularly in poorer countries. The secretary-general of the OECD, Angel Gurría, believes that developing nations lose three times more money to tax havens then they receive in aid each year (The Economist, 2015). This treaty shopping is made possible by lax tax laws which often unfairly discriminate against poorer, less developed nations. @ucdpolitics student, Hannah Twomey, argues in this blog post that it is not just tax havens that cost developing countries tax revenues. Double Taxation Agreements are legal agreements which often discriminate against lower income countries and deny them access to vital tax revenue which could be used for the development of the particular country.

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The Financial Transaction Tax: Has the Market Finally Met It’s Foe?

Billy VFollowing the Great Recession, many solutions have been put forward to “rein the markets in”, and try to plug the inequality that has been on the rise since. These have included rent controls, increased banking regulation, and efforts to harmonise corporate taxation and discourage international tax havens. Most are in agreement that the long term aim is “to create a financial system and an economy that works for all of our people, not just a handful of billionaires”. (Sanders, 2016) In this blog post, @ucdpolitics student, Billy Vaughan, argues that it is one thing to come up with convincing rhetoric, quite another to devise a detailed mechanism to tackle inequality, and in particular to shift the burden from capital to labour. Once such idea, however, is to introduce a Financial Transactions Tax, or FTT.

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#Ash-shab’yuridisqatannizam: How 140 characters shaped the world.

Hazel NOver the last decade, the power of social media as an independent media outlet has grown exponentially. Its ability to provide free and non censored information to the masses has allowed it to become a critical tool for political demonstration. @UCD_Politics student, Hazel Nolan, argues that social media sites such as Twitter and Facebook enabled and furthered the Arab Spring of 2010, as these domestic media outlets were censored by the various Middle Eastern governments. Freedom of speech as expressed through social media, she argues, gave way to the most rapid search of democratisation in a post-colonialism world.

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Ordoliberalism was the main inspiration behind EU competition law.

DanielEU-US relations have been marked by a significant volume of trade and close diplomatic ties for most of post-WWII history. Together the EU and US currently account for half of world GDP and a third of global trade (EU Commission Trade Department). The first transatlantic regulatory cooperation agreement was signed 1991 in the area of competition (Pollack, 2003, p.33). Nonetheless, despite strong efforts to achieve convergence, legal enforcement in this field is still marked by stark ideational differences on either side of the Atlantic. In this blog post Daniel Andersen argues that the US and the EU have completely opposing views on corporate monopolies, which manifests itself in the politics of anti-trust legislation, and can be traced to the economic philosophy of ordoliberalism. 

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The role of language in shaping German economic philosophy

Version 2Against the background of the Eurozone crisis, Germany’s economic thinking has been subject to intense public debate in the english speaking world, and historical experiences and cultural differences have sometimes been adduced to explain Germany’s preoccupation with balanced budgeting and independent central banking. In this post Caroline Bhattacharya argues that German economic policy is deeply intertwined with the German language.

All member-states of the  Eurozone got a flavour of the peculiarities of German economic thinking in recent years, with the German government romanticising the ideals of the ‘German export model’. In light of Germany’s crisis management, and it’s commitment to economic nationalism, there has been a renewed discussion – predominantly among Anglo-American commentators – whether there is a distinctive school of German and Austrian economic thinking, commonly referred to as ordoliberalism.

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With No Direction Home?

Labour mobility imbalances between European Core and Periphery: evidence from Italy and Portugal

fotoprofiloIn this post Vincenzo Maccarrone argues that much of the debate on the European economic crisis has concentrated on the presence of structural imbalances between Northern and Southern European countries[1]. When discussing this inequality most commentators focus on the differences in current accounts or in financial flows. However, little focus has been given to another aspect of the Euro crisis: the development of South-North migration flows. He asks whether this element of inter-European disparity something we should be worried about?

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