Daily Archives: December 13, 2010

Guest post: Last Thursday and the future of the anti-cuts movement

This is a guest post by Andrew Pryde, a sixth form student from Oxfordshire. You can follow him on Twitter here

On Thursday the 9th of December I made the journey from my sleepy Oxfordshire village to ULU, London, to join the Day X protest. What woke me, a studious even ‘nerdy’ sixth former, from the slumber of my comfortable middle class existence? Why, when I will not directly be effected by the £9,000 a year tuition fees, did I care enough to take to the streets of London? Because I felt cheated, betrayed even, by the political system our country calls a democracy. I, like the rest of my generation, or even the entire country, has been let down by a system supposed to act in our best interests.

I was too young to vote in the elections so I decided to try and have some small influence on the course of our country’s future. In my overwhelmingly Conservative constituency I had the youthful audacity to think that by campaigning—leafleting and posting posters—
I could influence the outcome of the election. I couldn’t as it turns out, however, it’s not my failure to influence the outcome that irks me—even given that I’m hopeful I brought at least a few people out to vote Liberal Democrat, whose votes in a proportionally representative system would have meant something. It’s the fact that I did it at all—in the pouring rain—that bothers me. I helped, and so did many others who believed in the liberal cause, with the grass roots political activities of a party that has subsequently abandoned my generation in the pursuit of personal power.

I was sold an ideology by the Liberal Democrats. Their principles of fairness, free education and nuclear reduction resonated with me. So much so that I was willing to get out of my metaphorical armchair and do something about it. However, I was lied to. I was led to act on false pretences; we all were. Normally misrepresentation of such a magnitude as that seen in the Liberal Democrats electoral campaign would lead to a trading standards investigation if it were a corporation concerned. Here, however, it leads to a political party entering into a government with no mandate and abandoning its principles.

Last Thursday was a watershed. Not because of what the protestors or even the police did but because of what the government did. They vandalised our education system in a far more costly manner than any army of protestors could hope to do to Parliament Square. They demonstrated that the government, the entire political ruling class, has lost touch with the reality of the lives of those they supposedly represent.

This is where UKUncut comes in. When the public become disenfranchised from the political system, when they feel that there is an injustice occurring, they grumble. However, this inactive response to injustice can be rectified, this maelstrom of disgruntled grumblers can be turned into an army for justice and equality. My generation are willing to fight for what they believe in, they’ve proved that in the last month of student protests, and they are ready to be mobilised. It’s now time to mobilise the rest of society because tax avoidance affects all of us.

The biggest factor that deters many 6th formers and college students from attending these marches in my experience is the cost of travel to London. What better to combat this than by mobilising people in their own communities? What better that to annul their worries about large periods spent missing vital education than organising short targeted protests on weekends? We have a historic opportunity to make a change to the way power is structured in this country, the world even. The people for too long have been at the behest of a ruling political class who are out of touch with its people. How can 18 millionaire ministers understand what it is to be a working or middle class student, public servant or worker? By mobilising the people of this country, not just the students and sixth-formers, but everyone UKUncut has a chance to change the world for good.

Small leaderless highly targeted actions are the way forward. We still need vast numbers of people to come out on the streets of our capital, to strike and to take part in civil disobedience but this won’t be enough. We can see in the media portrayal and in public perceptions of Thursday’s protest that these protests can be marginalised and categorised as despicable violent and thuggish events. These perceptions are of course unfair and unfounded because these people were not there. They were not crushed bodily against walls by advancing lines of riot police who were indiscriminately striking out into a crowd of protesters whose hands were raised above their heads in surrender and who were shouting “peaceful protest” until their throats could no longer stand the strain. They didn’t feel the fear and anger as advancing lines of mounted police threatened to crush their friends. What the public and the media can identify with, however, is peaceful direct action on every high street in this country. They can immediately see the injustice of the super rich evading taxes that their grandparents pay on their pensions, that the lowest paid workers in our country pay without option. They can get behind our cause.

So here’s my rallying cry. Go home from the streets of London with hope in your hearts because you can change the future. Take the anger you feel at the injustices you’ve seen, the pain of the bruises you may have received at the hands of your own police force, and turn it into action in your community. It takes fewer than 10 people sat in front of a shop doorway with a placard and leaflets to get our message across. We may have lost the battle on Thursday but we are winning the war. A poet read one of his pieces before we set off from ULU on Thursday. He said: “for a long time now, over the skies of this silver land, the Gods of conscience have been sleeping”. It is our job now to wake this country, to turn the wrath of its people towards inequity and to stop the tax-dodging rich and their ideologue counterparts in government from bringing down our country.

Guest post: If ever there was a campaign that Tories should support…

This is a guest post by Richard Murphy, one of the country’s leading tax experts and founder of the Tax Justice Network. You can follow Richard on twitter or read his blog

Those who oppose the UK Uncut tax protests argue – as the new head of the CBI did
in the Observer today
– that a company has a duty to be “tax efficient”. In saying this
Carr argued:

What are the rights, duties and responsibilities of any company? To ensure
shareholders are correctly rewarded and to act in the right way for the organisation.
Part of that is to be tax efficient. That’s reasonable and appropriate.

He’s wrong. As the Tax Justice Network has argued:

Companies and rich people can locate wherever they are “tax efficient”. Ordinary
people lose out from the process. There is a term for this: its called the Bono
Defence. Named after the Irish rock musician whose band shifted its tax base from
now bankrupt Ireland to the Netherlands in the name of “tax efficiency”, the Bono
Defence provides stark warning that tax dodging doesn’t promote better economics; it
promotes failed states.

That’s a big claim, but one that is justified. Those like Bono and the CBI, and others
from business and the right wing who argue tax efficiency is simply tax avoidance
and tax avoidance is legal and so acceptable have entirely missed (or deliberately
ignored) some enormous ethical issues when making their claims. For a description
of what tax avoidance (and some of the other language used here about tax) means I
refer you to my blog but the big issues can easily be explained.

First, just because something is legal does not mean it is ethical. Think apartheid in
South Africa or even slavery in 18th century England and move on from there.

Second, remember that when you avoid something you go round it. That’s what tax
avoiders do. They go round the law. How on earth can anyone, anywhere claim that
getting round the law is ethical?

But perhaps most important is the fact that a limited liability company gives its
shareholders in whose interest Roger Carr says it must be run the most phenomenal
economic privilege: they cannot be sued for the debts the company incurs if all goes
wrong even though they get all the benefit if things go right. That’s an astonishing
privilege. It is not a right. I stress, it is a  privilege – and one that is granted by
parliament on behalf of the people of the UK.

The privilege carries with it at least two implicit responsibilities. The first is to
account for how the privilege is used – which means putting full and proper accounts
on public record so we can know exactly what our companies are up to. The second
obligation is to pay for the privilege – and that means complying fully and willingly
with the tax (and other) laws passed by the UK parliament that creates them using
exactly the same authority that they use to grant the privilege of limited legal
liability. Of course these two obligations are also related – the accounts must properly
explain how much tax is paid.

In combination these observations puts paid completely and utterly to Roger Carr’s
argument that the company has a duty to its shareholders to be “tax efficient”.

That’s not true. It has a duty to society to be tax compliant in exchange for the
benefit of limited liability granted to its shareholders.

That then requires that companies be tax compliant. Tax compliance means seeking
to pay the right amount of tax (but no more) in the right place at the right time
where right means that the economic substance of the transactions undertaken
coincides with the place and form in which they are reported for taxation purposes.

Tax compliance is a million miles form tax avoidance. Tax avoidance is about reducing
a tax bill come what may without breaking the law, and not caring who else has to
pick up the bill. Tax compliance is about trying to pay the right amount of tax, but
no more. The last bit is important: no one has to voluntarily pay tax. But no one has
to use a tax haven or a loophole either when the result is that the tax not paid by the
company and its shareholders as a result will be shifted onto ordinary working people
instead (and for the pedants who say this assumes tax is a zero sum game, my answer
is it certainly  looks like it is from all the evidence over recent years of tax burdens
shifting from capital to labour).

So, in that case what is UK Uncut doing? In summary it seems to me it is doing three
things. First  it is trying to uphold parliament and the ethics of democracy – including
voluntary compliance with the rule of law. Second it’s asking that people, and
especially large companies, comply with the law – and not avoid it. And thirdly it’s
saying that there’s a contract between the people of the UK and the people who own
companies which is implicit in the granting of limited liability and that some who
use companies are acting in breach of that contract. That is unacceptable and all UK
Uncut are saying is that it’s time corporate UK honoured the obligations it has to fulfil
in exchange for the privilege it has been granted.

Seen in this way it’s extraordinary that anyone can object to such a campaign. If ever
there was a campaign that Tories should be turning out in force to support it’s this
one, largely run by young people, that demands that people comply with the law and
respect parliamentary democracy.

So the real question is, if they aren’t doing that, then why not? Could it be that
they’re on the side of those who are in breach of their contract with society?