Inflicting Death and Avoiding Taxes: The G-8 Stalls

For some time it has been a gathering that seemed to be more floral than substantive, a matter of chit chat, sometimes serious, over issues of the day. General guidelines are proposed. Bland suggestions are made. Declarations are always filled with well meaning suggestions, the well aimed bromide to assuage.

In recent years, the leaders of the G-8 have acted as some de facto consortium of much noise signifying nothing. As Tom Barry observed in an article for Foreign Policy in Focus as far back as July 2002, the G-8 “had shown little leadership in addressing the deepening crisis of global governance.”

As forecast prior to the talks in Northern Ireland, the conflict in Syria dominated discussion and vacillation. The status quo has been affirmed – the United States, Britain and France wanting to push the Assad regime out, with Russia insisting that the move needed to be tempered with strict guidelines.

The result, naturally unsatisfying for everyone other than the political mechanists, is that the G-8 have agreed that something has to be done regarding Syria, though what exactly should be done remains unclear and at best inchoate. The casualty rate is soon to peak at 100 thousand dead, but the G-8 leaders left the press corps with a vaguely imprecise list of options.

A seven point plan was the resulting offspring of the talks. British Prime Minister David Cameron, in observing that there were “very different views around the G-8 table” could tell his constituents that “fundamental differences” had been overcome through “frank discussion”.

The points themselves reveal nothing significant. The “bloodshed and loss of life” had to be stopped. A peace conference should be held in Geneva as soon as possible, leading to a “transitional governing body” to take the reins of power. Humanitarian aid had to be increased. The disastrous “lessons of Iraq” – namely, the dismantling of institutions – had to be kept in mind. The use of chemical weapons had to be condemned and investigated. Syria had to be cleansed of “terrorists and extremists”. Any succeeding government would have to be non-sectarian.

In the end, the Russian President is probably bound to be the most content. Having been busy tipping the balance against Bashar al-Assad’s enemies, he is the one with more cards than most. When the balance was swinging away from the Syrian regime, the Russians beefed up Syria’s surface-to-air capabilities. While his politics might seem rank, Putin’s position has been clear from the start. Everyone knows the horse he is backing and the oats he is giving it. Nor is he too keen on seeing a Sunni-mad regime come to power. Watch, he seems to be saying, what you wish for.

In contrast, the Western powers such as France, the United States and Britain keep company with such peculiar customers as Qatar and Saudi Arabia, who see their own version of regime change in the Middle East with heavily tinted glasses. The result is promised change with no change.

The other feature on the agenda, and again, another well aimed bromide, was the global bogeyman of tax evasion. As Robert W. Wood of Forbes Magazine (Jun 19) explains, “The G-8 nations agree: tax evasion is bad and hurts everyone. More inter-nation corporation is needed. But exactly what is legitimate and what isn’t aren’t so clear.” Global tax evasion, in terms of figures, vary, but one estimate from the Tax Justice Network puts it at around $3 trillion a year.

Cameron was pushing for the execution of the Multilateral Convention on Mutual Assistance in Tax Matters. Vital to this, as Wood points out, is the information sharing aspect of the document, enabling several jurisdictions to share information about bank accounts. None of this actually clears up the business as to what is legitimate tax “minimisation” and what constitutes actual evasion. The tax accounting wizards at Apple and Google know only too well that appearance is everything and that money has a habit of walking when needed.

Leaders such as Canada’s Stephen Harper have shown lukewarm enthusiasm, when he has bothered to, about such international reform. MPs from the NDP see Harper as heading the pack against such change. “Why Stephen Harper should choose to protect those who use international tax havens to evade paying their taxes is inexplicable and is unacceptable,” suggested NDP Foreign Affairs critic Paul Dewar (iPolitics, Jun 11).

The resulting Lough Erne declaration from the G-8 summit was standard process without more, a stand favouring transparency over clandestine and unreachable tax havens. “Countries should change rules that let companies shift their profits across borders to avoid taxes, an multinationals should report to tax authorities what tax they pay and where.” As Dennis Howlett of Canadians for Tax Fairness surmised, “The commitments are hedged a bit and the roadmap for action is vague.” That said, he was content that the declaration “definitely moves us forward in efforts to curb tax evasion facilitated by tax havens.”

Such matters – death and taxes – are truly staples and plagues of human existence. But the G-8 discussions have shown that, whether it be the issue of debt relief (Gleneagles, Scotland in 2005); or the New Partnership for Africa’s Development (Kananaskis, Canada), actions tend to lag behind undertakings.

Binoy Kampmark was a Commonwealth Scholar at Selwyn College, Cambridge. He lectures at RMIT University, Melbourne.

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