We today “reap the benefits of public services built by previous generations” and corporate leaders “more willing to pay taxes”. But what will we be passing on to future generations?[1] Across Western society, “in the name of austerity, we put off investments critical to our future. We also put off the maintenance of our existing infrastructure, our schools and hospitals, roads and bridges, the worst kind of false economy, passing on even more expensive problems to future governments, future generations, jeopardizing our economic performance”, and exposing our countries to the debacle of greater inequality, polarization, and division – eroding our redistributive institutions and the programs that support our society and mitigate inequality.[2]

Such decay doesn’t just happen in a vacuum: this sort of growing inequality – and it is a worldwide phenomenon in developed countries, including Australia [the UK, the EU, the USA, and Canada] – happens because politicians make choices. And the choices they make are what they are because those making them are more influenced by the rich and powerful.

– Tim Dunlop, ‘Inequality is a political problem, not an economic one’, ABC News (Australia)[3]

Countries across the world have used recent tax reforms to lower taxes for businesses and wealthy individuals, raising concerns of a ‘race to the bottom’ as any short-term advantage a country gains from a lowered tax rate (particularly corporate tax rates) “evaporate as other countries respond by cutting their own tax rates”.[4] By definition, these type of ‘beggar-thy-neighbour’ policies leave all countries at the bottom to the benefit of vested special interests.[5] 

The way in which governments raise and spend revenue has a substantial impact on the economic and social development of nations.[6] So, what needs to be done to ensure a sound corporate tax system focused on growing investment and economic growth with a robust personal income tax that ensures everyone contributes to society what’s fair?

We appear to be in a time of quickening, a time when history seems pushed through a funnel, pushed toward some future gathering speed.  Inequality may now be so sharp, and the political process so tightly captured by corporate interests and the financial elite, that necessary taxation reforms will not happen. But that should not stop leaders, policy-makers and society from aspiring to improve.[7] As governments across the Western world look to cut their spending and reduce their budgetary deficits, often at the expense of the vulnerable (including the working and middle class), it seems appropriate to ask the question: is it socially responsible for top earners, the ultra-wealthy, and corporations to deprive the communities in which they operate their tax revenue? Companies spend a lot of time and money on improving their corporate image and stressing their commitment to the community, but it is difficult to take this seriously if those same companies and financial elite are simultaneously depriving those communities of tax revenue that could be spent on their development and economic growth.[8] 

[W]hen governments reduce the tax burden for large corporations [and wealthy high earners], they tend towards two options: to cut back on the essential spending … or to make up the shortfall by levying higher taxes … on other, less wealthy sections of society.

– Esme Berkhout, tax policy[9]

As noted by the eminent American jurist Oliver Wendell Holmes, “taxes are the price we pay for a civilized society”.[10] Taxes are an integral part of our society. They pay for the infrastructure we rely on, provide for public services such as health care and education in most western countries, and help redistribute wealth to facilitate growth and a more just society. The challenge is to carefully choose not only the level of tax rates but also the tax base.[11] 

There is a danger today for politics to be driven by ideologies, passions, and ‘big money’ political influence disconnected from facts – that citizens are being “deliberately shielded from facts and reason and logic”.[12] And as countries across the Western world move inexorably toward their next national election – with Canada heading into a federal election this year – our nations are more divided than any other time in our modern history. The fragmentation today is not only ‘right versus left’ or ‘them versus us’ tribalism, but maybe more importantly, a split between our citizens who fear the system is failing them and those who are more trusting of our traditional institutions and more optimistic about the future for themselves and their families:[13]

“[Even Canada – yes Canada – is becoming] a nation divided. … This year, the Edelman Trust Barometer, a global study measuring trust in government, business, NGOs and the media, recorded the largest-ever trust gap between the informed public – educated and informed upper-quartile income earners – and the mass population. The 20-point split was the second-highest among the 27 markets Edelman includes in the survey, behind only Britain (where acute polarization is heavily influenced by Brexit, among other factors).

The disparity in trust tells the story of a country that feels out of balance – one where the ability to rely on and trust in institutions differs greatly depending on your level of income and education. This, in turn, drives a strong sense of injustice and pessimism among the mass population in Canada. In fact, 50 per cent of Canadian respondents feel the system is failing them, and only 34 per cent believe they and their families will be better off in five years’ time.

Some of the factors driving both the trust gap and the lack of optimism are clear: the future of our oil and gas industry remains uncertain; the negative effects of globalization, automation and free trade are stoking fears about job security, particularly in manufacturing; and income disparity in this country is becoming more severe, adding to the perception that the wealthiest [companies and citizens] are not paying their fair share and are leaving the masses behind.”

The … economy increasingly serves only a narrow part of society, and … national politics has failed to put [Western countries] back on track through honest, open, and transparent problem solving. Too many of … elites-among the super-rich, the CEOs, and many of my colleagues in academia-have abandoned a commitment to social responsibility. They chase wealth and power, the rest of society be damned.

– Jeffrey Sachs, The Price of Civilization: Reawakening American Virtue and Prosperity[14]

This fragmentation, largely along socioeconomic lines, colour the major issues each of our nations face,[15] in particular tax policy. The fair distribution of the tax burden has long been a central issue in policy making, and this may well be the right time for bold policy discussions in respect to taxation, corporations and the financial elite (i.e. sometimes referred to as the ultra-rich or ultra-wealthy). If tax policy does indeed move to the front pages of media coverage across the world, transformative changes may well be pending, forcing leaders across the business, financial and political spectrum to consider their priorities and their behaviour.

Interestingly, a U.S. politician – Alexandria Ocasio-Cortez – recent proposal to raise marginal tax rates on those who make over $10 million has sparked a growing debate over tax policy.[16] And these type of proposals have ignited spirited conversation over taxation and inequality that will likely keep economic populism at the center of elections across the world:[17]

“[Amazon’s CEO Jeff] Bezos is the world’s lone hectobillionaire. … He has gotten $50 billion richer in less than a year. … This is a credit to Bezos’ ingenuity and his business acumen. … But his fortune is also a policy failure, an indictment of a tax and transfer system and a business and regulatory environment designed to supercharging the earnings of and encouraging wealth accumulation among the few. … The result of these decades of trends and policy choices is that Jeff Bezos has accumulated a $150 billion fortune while the average … family is poorer than it was when the [2008] Great Recession hit. … Rising inequality fuels political polarization and partisan gridlock … it makes government less responsive to the demands of normal people, potentially putting our very democracy at risk.”

The evidence is persuasive that extreme inequality has a corrosive effect on the economy. Wealth inequality places immense resources in the hands of corporations and people unable to spend it productively, and keeps it out of the hands of governments forced to impose austerity measures to the detriment of society,[18] and citizens who could put it to immediate use on staples that should be within the reach of everyone living in the richest countries in the world.[19]

In respect to the unprecedented trust gap across the globe, who will build the bridge for our divided countries? The future challenges facing the Western world – from the UK and the EU to the U.S. and Canada to Australia – confront all of us. The answer then requires leadership, and must involve some recognition that we are all in this together. That in a civilized country “everyone who can realistically do so should contribute something, based on their individual means, which is roughly the way the system is currently set up. The tax code doesn’t need to ‘differentiate between the rich and the middle class’ and corporations. It just needs to be progressive in the sense that tax liabilities rise with income levels” and corporations are taxed at an appropriate rate that together is “broadly supported by a public that recognizes its stake in meeting the future challenges we all face”.[20]

However, there is no way out without strong leadership – from our business leaders and our government leaders – and a different conversation on taxes.[21]

While the macro factors that have accelerated the trust gap are reasonably well understood, what to do about it remains a mystery. How do we bridge the divide between these two groups? How do we empower those who fear they’ve lost their voice? How do we restore broad-based faith in a system too many feel is broken?

– Globe and Mail[22]

Overview

Governments across the world are compromised in their ability to fund the public goods of modern societies, and their citizens (and future generations) are saddled with many problems not of their own making: from shaky finances to pinched infrastructure and social safety net to loss of trust in meritocracy, our leaders and our institutions.[23]

As trust and confidence in our institutions has eroded,[24] the International Monetary Fund and the Organization for Economic Cooperation and Development (OECD) have noted that too many people in Western societies feel left behind by globalization and technological change.[25] This broad perception is unquestionably rooted in fact: “big slices of society, in big chunks of the developed world, have seen real wages stagnate even as returns rapidly escalated in a small number of pockets. Ultimately this creates both growing inequality in wealth and income and — perhaps more troubling — a sense that gaps in opportunity have widened”.[26]

And we are left trying to make sense of what appears to be a new world and a system that is broken.  At this time in history it may well be proven correct that the “veracity and very survival of democracy depends on a strong” middle and working class “that is able to hold government accountable”. The link between income and stable democracies “is, at a certain level, intuitive. After all, at the heart of democracy is an economic contract between citizens who consent to pay taxes and a government that, in exchange”, ensures a fair system of taxation and safeguards the security and welfare of the nation by providing public goods such as education, healthcare, infrastructure, a social safety net, appropriate deficit reduction, and emergency services and national security. “In essence, any economic challenge that threatens the middle and working class places this contract – and ultimately, democracy – in peril”.[27]

Individuals and companies all have to pay taxes. But some of the world’s wealthiest individuals and multinational companies, able to afford ingenious lawyers and accountants, have figured out ways to avoid paying enormous amounts of taxes. 

– Tax Avoidance and Tax Havens: Undermining Democracy[28]

From the EU and the UK to Canada and the U.S., and from Asia to Australia, countries and their societies are being adversely reshaped toward an unsustainable future by ‘big money’ political influence of tax policy and tax rates, and aggressive schemes of tax avoidance and offshoring of the world’s wealth[29] by corporations and the ultra-wealthy.

How should advanced countries and their governments respond to growing income and wealth inequality, and their increasingly fragmented and polarized societies struggling to find consensus in cultivating economic growth and funding the public goods and services required today? For some the answer is obvious: appropriately tax corporations and top income earners who have enjoyed, for almost a generation, the lion’s share of all income and wealth gains, and redistribute the revenue.[30] A progressive and fair tax system for corporations and individuals is central to the capacity of nations to fund their own growth[31] – and higher taxes, raised progressively, would encourage economic growth by helping to pay for long-neglected public investment in our nations’ public goods (including infrastructure, education and research), help put government finances on a stable path, and reduce rising income and wealth inequality that holds back economic growth:[32] 

“The big obstacle to comprehensive tax reform is the persistent … myth that spending cuts alone can achieve economic and budget goals. … Yet it still has adherents … which will make it that much harder for [governments] to grapple with the bigger and more complex issue at the heart of tax reform: how to pay for government in the 21st century.

The main problem is that the current tax code [in many countries, due to tax cuts for corporations and the wealthy,] is incapable of raising the revenue needed to pay for the goods and services of government.” 

Taxes have been cut dramatically over the years for corporations and high-earners, and an appropriate review of tax policy and the re-imposition of higher taxes on corporations and the wealthy is the best way for countries to reinvest in their social safety nets, education, healthcare, and infrastructure, while promoting economic growth[33] and protecting the working and middle class and vulnerable populations. Other commentators[34] argue that in a globalized economy, raising taxes on society’s wealth creators leads to capital flight, falling government revenues, and less money for the vulnerable. These same voices contend that lowering taxes on everyone stimulates innovation and investment, fuelling future prosperity and economic growth.[35] However, outside of extreme levels of taxation, “history shows no real link between tax rates and economic growth”.[36] The question now: will the debate over raising taxes (even if not to the levels of previous generations) for corporations and the ultra-rich “crystallize into a serious policy push or crash on the shoals of partisanship” and corporate and financial elite political lobbying and political capture?[37]

Infrastructure investment is vital to growth in the United States, but making a lasting impact will depend not on ‘how much’ but ‘how well’. … The additional spending must squarely address growth-stunting gaps rather than just getting money out the door. The cracks in America’s infrastructure are glaring. … Growth is also held back by insufficient investment in education systems, health services, and environmental care. 

– Brookings Institution[38]

A majority of citizens in advanced economies – including many strategic and socially responsible corporate leaders, millionaires and billionaires[39] – want to see an appropriate increase in tax for corporations and the wealthy and better services from government.[40]  A recent OECD survey (encompassing 22,000 people in 21 countries) found that although people in these countries are living safer, healthier, and longer lives, and are better educated than ever before, many fear they are falling behind and are worried about their futures.[41] Millions of citizens across Western society are living on the edge:[42]

“In a recent poll, 71% of Americans across lines of ethnicity, class, age, and gender said they believe the US economy is rigged. People reported that they are working harder for financial security. One-quarter of the respondents had not taken a vacation in more than five years. Seventy-one percent said that they are afraid of unexpected medical bills; 53% feared not being able to make a mortgage payment; and, among renters, 60% worried that they might not make the monthly rent.”

Taxes are not simply about money or fees collected by governments. Taxes are about public programs and services, infrastructure, education, healthcare, unemployment insurance, reducing poverty and the harmful effects of inequality, protecting the environment, and promoting economic growth. Quality infrastructure is critical for the sound functioning of an economy because it plays such a central role in determining the location of economic activity and the types of sectors that can develop. A healthy workforce is vital to an economy’s competitiveness and productivity—investing in the provision of health services is essential for both economic and moral reasons. Basic education increases the efficiency of each worker, and good-quality higher education and training allow economies to move up the value chain beyond simple production processes and products.^[43] Taxes pay for the democratic institutions of government, as well as funding the transfers, programs, and services governments provide[44]:[45]

“To foster economic growth and development governments need sustainable sources of funding for social programs and public investments. Programs providing health, education, infrastructure and other services are important to achieve the common goal of a prosperous, functional and orderly society. And they require that governments raise revenues. Taxation not only pays for public goods and services; it is also a key ingredient in the social contract between citizens and the economy. How taxes are raised and spent can determine a government’s very legitimacy.”

Appropriate taxation is about building the kind of country that most citizens want. Different political parties and governments over the last four decades have promoted lower taxes for corporations and the financial elite as the solution to all ills. Unfortunately, the evidence suggests that the beneficiaries of this destructive ‘race to the bottom’ have been significantly limited to wealthy individuals and corporations (and their executives and shareholders). Yet governments in every part of the world appear unable to withstand playing a part in this race to the bottom.[46] In the face of falling tax revenues from these important sources of taxation (as a result of regressive tax cuts), these same political parties then take the position that their country’s most basic programs are unsustainable, austerity is required, further tax cuts are needed, and that there is public ‘fat’ to cut.[47]

Rutger Bregman …. decided to go off-piste at the World Economic Forum … [discussing with] the assembled billionaires they should stop avoiding paying tax. … They talk a lot about how something must be done about inequality and the need to address social unrest, but cavil at the idea they might be a big part of the problem. …  ‘Nobody raises the issue of tax avoidance and the rich not paying their share. It is like going to a firefighters’ conference and not talking about water’.

– This is about saving capitalism: the Dutch historian who savaged Davos elite, The Guardian[48]

It seems strange, in an era where companies are placing a greater emphasis on their contribution to society, that ‘big money’ political lobbying and aggressive tax avoidance has become so prevalent and such accepted practices. Politicians and regulators are lobbied relentlessly to endorse taxation policies that make corporations and their shareholders richer while offering “as little as possible to other stakeholders”.^[49]  It would be naive to believe there will ever be a time when all companies and the wealthy cease to lobby for self-interested tax policy or attempt to avoid tax. But surely – if we are to take any corporation, corporate leader, or other financial elite’s claim to be socially responsible seriously – we must at least expect that such corporations and ultra-wealthy begin by paying their fair share of taxes.^[50]

Apple and its peers have been working furiously to tilt the tax code in their favor. … Indeed, major corporations said over and over throughout the latest tax debate that if given a big tax cut, they would reward shareholders ….  Spending millions in lobbying dollars to save tens of billions of dollars in taxes isn’t really a display of ‘responsibility’ to a country or its people. It’s a greedy act done for shareholders, who have been rewarded handsomely.

– Josh Hoxie, Fortune Magazine^[51]

From a corporate perspective, does a corporation and their executives and board members have a responsibility to avoid causing harm to the community, to not use their economic and political power to secure legislation that is unfairly favourable to them? Does a company’s responsibility to society start with paying its reasonable contribution of taxes?^[52] Should a key principle of corporate governance for corporations be a responsible approach to tax practices that takes into account all of its stakeholders – not just its shareholders – but all company stakeholders encompassed within the broader economic and social view?^[53] Boards have a fiduciary duty to a number of stakeholders, and not just shareholders.  The long-term health of the company itself, and the communities in which they operate and the economic system generally, depends on getting the role of shareholders[54] right in the stakeholder continuum.[55] In this context, the Boards and executive leadership teams of multinational enterprises and the tech giants must overcome the ‘forces of short-termism’ and cultures of greed,[56] and reinvigorate an ethos of ethics and public purpose that appear to have become dangerously decoupled from many of today’s leading organizations such as Amazon, Google, and Apple.[57] To “prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate”[58]:^[59]

“There is a common belief that corporate directors have a legal duty to maximize corporate profits and ‘shareholder value’ — even if this means skirting ethical rules, damaging the environment or harming employees. But this belief is utterly false. To quote the U.S. Supreme Court opinion in the recent Hobby Lobby case: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” …

So, where did the mistaken idea that directors must maximize shareholder value come from? The notion … has … been embraced by increasingly powerful activist hedge funds that profit from harassing boards into adopting strategies that raise share price in the short term, and by corporate executives driven by ‘pay for performance’ schemes that tie their compensation to each year’s shareholder returns. In other words, it is activist hedge funds and modern executive compensation practices — not corporate law — that drive so many of today’s public companies to myopically focus on short-term earnings …  and indulge in reckless, irresponsible and … destructive behaviors.”

The error at the heart of corporate leadership: most CEOs and Boards believe their main duty is to maximize shareholder value. It’s not. 

–  Harvard Business Review[60]

As a result of a relentless onslaught on the value of public programs over the past thirty years, taxation has come to be viewed as a burden rather than a tool for promoting the common good. It seems that few are asking what is the real cost of tax cuts or who pays the price[61] – across the Western world the costs of decades of cuts are increasingly visible, felt first by women, the young and the most vulnerable, then the working and middle class, but ultimately by us all.[62] It is difficult to imagine a pathway out in the absence of strong leadership and a different conversation on taxes.[63]

Institutional trust is a critical topic for governments and for business. Trust is the foundation upon which the legitimacy and sustainability of political systems and business is built. However, the rise of inequalities observed in most Western, OECD, and emerging economies is translating into growing political disaffection, anti-market sentiment, and disenchantment with globalization. The ongoing impact of global political and economic unrest are reflected in the annual findings of the Edelman Trust Barometer, which indicate that “only one in five feels that the system is working for them, with nearly half of the population believing the system is failing them”. We have also seen widespread anger over the inability or inaction of governments to address tax evasion, aggressive tax avoidance, ‘big money’ political lobbying and corruption, political and regulatory capture, and other problems. And in countries most severely affected by these issues, trust in public institutions and business has been hit hard:[64]

“Across countries, trust has plummeted. The Edelman Trust Barometer shows that overall less than half of the general population trust their government. … [W]e have also found that only one third of the population think they have a say in what the government does. This is deeply concerning. … And … let me conclude by highlighting also the importance of trust in business, which Edelman also covers in it analysis. … [I]t is critical to restore the trust of citizens in the system, and in order to do so we are tackling some of the most pervasive problems, like … adequate taxation of economic activity. [The OECD is] also working hand in hand with the private sector on its responsibility towards society, beyond shareholders, through initiatives like [the OECD’s] recently launched Business for Inclusive Growth.”

Citizens across the world are looking for leaders in government, multi-lateral institutions (i.e. OECD, World Bank, U.N., etc.), and in business to act with purpose – to put an end to the capture of tax policy by private vested interests that work against the public interest. They are expecting leaders to have the courage and accept this responsibility.[65]  In the United States, several business leaders have indeed accepted this new responsibility, with the CEO of Patagonia Inc. (Rose Marcario) donating the entirety of its US$10-million federal corporate tax cut to non-profit groups – an apparent critique if not rebuke to the recent U.S. corporate tax cut policies for corporations and the wealthy.[66] On the other hand, some of America’s biggest companies continue their leadership practices of paying little to no federal income tax,[67] with Amazon’s executive and board leadership taking steps to ensure their multinational corporation paid “nothing in [U.S.] federal taxes for the second year in a row” despite “posting more than U.S.$11.2-billion in profits” and a U.S. national debt ballooning to over U.S.$22-trillion as a result of declining tax revenue.[68]

The failure to tax corporations and the ultra-rich reasonably and fairly is not only a missed opportunity to reduce inequality and appropriately support society – it actually worsens it, as governments must resort to taxing the rest of society more, or cut spending on health, education, environmental care, infrastructure, and other public services and social protection that benefit society, stimulate growth, and reduce inequality.[69]

Since the mid-1990s, the redistributive effect of taxes and transfers has declined.[70] Until leaders are willing to make the tough decisions required to change the current policies that undermine appropriate tax policy, the ‘race to the bottom’ will continue. Citizens are looking to business and business leaders to act with purpose and to lead, to accept this responsibility and embrace this reality.[71]

Stagnant median incomes, rising inequalities and reduced social mobility have led many citizens to conclude that society’s social contract has ceased to function for them. At the end of the day, progressive taxation and the tax and transfer system is a central means of redistributing in a fair and impartial manner the gains of growth to pay for public goods and services, promote equity, and protect a government’s legitimacy. Ensuring these systems foster inclusive growth requires a holistic approach, and it is important to ensure that corporations and the ultra-wealthy are coherently and reasonably taxed along with the rest of contributing society – and that “big money’ political influence, political capture, and aggressive tax avoidance does not undermine effective and fair taxation policy.[72]

Controlling the terms of the tax policy debate in the face of ‘big money’ political influence, and then advancing from debate to action may well be the toughest challenge for governments and businesses around the world. In solving this problem, political and business leaders should not underestimate the power wielded by those who wish to continue to be the economic beneficiaries of politically-inspired inequality.[73]

Taxes connect us to one another, to the common good, and to the future. This is a book about taxes: who pays what and who gets what. More than that, it’s about the role of government, about citizenship and our collective well-being, about the Canada we want. The contributors, leading Canadian practitioners and scholars, explore how taxes have become a political “no-go zone” and how changes in taxation are changing Canada. They challenge the view that any tax is a bad tax and provide broad directions for fairer and smarter approaches.

– Alex Himelfarb (editor), Tax Is Not a Four-Letter Word: A Different Take on Taxes in Canada[74]

Corporations and Ultra-Wealthy do not pay their Fair Share in taxes

Background

As noted by the OECD more than twenty years ago in an article entitled Harmful Tax Competition: An Emerging Global Issue,[75] “historically, tax policies have been developed primarily to address domestic economic and social concerns. The forms and levels of taxation were established on the basis of the desired level of publicly provided goods and transfers, with regard also taken to the allocative, stabilizing and redistributive aims thought appropriate for a country. While domestic tax systems of essentially closed economies also had an international dimension in that they potentially affected the amount of tax imposed on foreign source income of domestic residents and typically included in the tax base the domestic income of non-residents, the interaction of domestic tax systems was relatively unimportant, given the limited mobility of capital. The decision to have a high rate of tax and a high level of government spending or low taxes and limited public outlays, the mix of direct and indirect taxes, and the use of tax incentives, were all matters which were decided primarily on the basis of domestic concerns and had principally domestic effects. While there were some international spillover effects on other economies, those effects were generally limited.[76]

The accelerating process of globalization of trade and investment has fundamentally changed the relationship among domestic tax systems. The removal of non-tax barriers to international commerce and investment and the resulting integration of national economies have greatly increased the potential impact that domestic tax policies can have on other economies. Globalization has also been one of the driving forces behind tax reforms, which have focused on base broadening and rate reductions, thereby minimizing tax induced distortions. Globalization has also encouraged countries to assess continually their tax systems and public expenditures with a view to making adjustments where appropriate to improve the “fiscal climate” for investment. Globalization and the increased mobility of capital has also promoted the development of capital and financial markets and has encouraged countries to reduce tax barriers to capital flows and to modernize their tax systems to reflect these developments. Many of these reforms have also addressed the need to adapt tax systems to this new global environment. [77]

The process of globalization has led to increased competition among businesses in the global market place. Multinational corporations are increasingly developing global strategies and their links with any one country are becoming more tenuous. In addition, technological innovation has affected the way in which multinational enterprises are managed and made the physical location of management and other service activities much less important to the multinational enterprises. [78]

Globalization has, however, also had the negative effects of opening up new ways by which companies and individuals can minimize and avoid taxes, and in which countries can exploit these new opportunities by developing tax policies aimed primarily at diverting financial and other geographically mobile capital. These actions induce potential distortions in the patterns of trade and investment and reduce global and national welfare and safety nets. These schemes can erode national tax bases of other countries, may alter the structure of taxation (by shifting part of the tax burden from mobile to relatively immobile factors and from income to consumption) and may hamper the application of progressive tax rates and the achievement of redistributive goals. Pressure of this sort can result in changes in tax structures in which all countries may be forced by spillover effects to modify their tax bases, even though a more desirable result could have been achieved through intensifying international co-operation. More generally, tax policies in one economy are now more likely to have repercussions on other economies. These new pressures on tax systems apply to both business income in the corporate sector and to personal investment income”. [79]

So, what is happening to national politics and governments in the western world to allow this to happen? Exhaustion, hopelessness, the dwindling effectiveness of old ways: these are the themes of politics all across the world. For the first time in seven decades[80] – as America appears to have grown weary of their historical leadership role in the world[81] – there appears to be no single country or alliance of powers ready to take on the challenges of global leadership.[82]

But why is this happening? The answer is not self-evident, however, it may be in part that the 20th-century political, social, and economic structures are drowning in a 21st-century ocean of politics and governments awash in ‘big money’ and ‘dark money’ from competing corporate and financial elites,[83] political party polarization and partisan “zero-sum” ideology (that is disconnected from the wider society),[84] widening economic inequality and cultural division, deregulated finance, globalization, and autonomous technology.[85] These are profound changes that are transforming the workforce and society in post-industrial economies[86]:[87]

“For increasing numbers of people, our nations and the system of which they are a part now appear unable to offer a plausible, viable future. This is particularly the case as they watch financial elites – and their wealth – increasingly escaping national allegiances altogether. Today’s failure of national political authority, after all, derives in large part from the loss of control over money flows. At the most obvious level, money is being transferred out of national space altogether, into a booming “offshore” zone.[88] These fleeing trillions undermine national communities in real and symbolic ways. They are a cause of national decay, but they are also a result: for nation states have lost their moral aura, which is one of the reasons tax evasion[89] has become an accepted fundament of 21st-century commerce.”

People often talk up the virtues of their national meritocracies, but – whether in France, America or elsewhere – such rhetoric seldom fits the facts. Often the purpose is to justify existing inequalities.

– Financial Times^[90]

The problems of tax evasion and tax avoidance by wealthy individuals and organizations are as old as taxes themselves, and the recent Paradise Papers scandal revealed how corporations and ultra-rich individuals have exploited a global system that allowed them to avoid paying their fair share of tax.[91] Looking at multinational enterprises and national corporations, according to some researchers, such organizations shift at least 40% of their profits – or about $600 billion – into tax havens, with the International Monetary Fund’s findings supporting global revenue losses of over $650 billion annually.[92] It is estimated that Canadian companies have shifted about $200 billion into tax havens. Assets that go untaxed. This is costing governments billions in lost taxes every year.^[93] To put this in perspective, it has been suggested that for each $10 billion in tax revenue lost is approximately equivalent to the income taxes from two million average households[94]:^[95]

“Taxes on corporations are plummeting across the globe as countries struggle to keep up with multinational firms shifting their profits to foreign tax havens, economists say in a new paper. The average corporate tax rate globally has fallen by more than half over the past three decades, from 49 percent in 1985 to 24 percent in 2018, the study found. …

The international decline in corporate taxes threatens to drain governments of a source of funding for health care and other social welfare programs, while already leading many European countries to adopt larger regressive sales taxes on goods ….

Proponents of tax cuts have maintained that lower corporate rates spur capital investment and business growth, improving worker productivity and wages. But the academics say the falling tax rates instead reflect a race to the bottom as nations try to prevent multinational firms from “artificially” shifting their profits overseas through accounting gimmicks. … ‘This massive tax avoidance — and the failure to curb it — are in effect leading more and more countries to give up on taxing multinational companies,’ the authors wrote in a summary of their research published by the Centre for Economic Policy Research [Professors Gabriel Zucman of the University of California at Berkeley, and Thomas Tørsløv and Ludvig Wier of the University of Copenhagen]. …

The falling corporate tax rate represents a ‘collective action problem,’… as each country has a strong incentive to lower its own tax rate, although when that is done the globe suffers. … [T]he overall trend has suppressed corporate tax rates globally, and the consequences of the loss of revenue may be rising. Throughout the 1980s, multinational profits amounted to only 4 percent of all profits earned by companies among “economically advanced” nations. From 2010 to 2018, they accounted for 16 percent of all business profits in those countries.

‘There is nothing natural in the decline of corporate income tax rates … . Profit shifting, more than tax competition for productive capital, is the key driver of this decline.”

Policymakers should consider just how much they are underestimating economic growth and under-collecting corporate tax revenues because they are missing the profits that have been shifted by multinationals to tax havens. And governments must start tackling tax havens and “cracking down on profit shifting.” They need to find ways to tax companies like Google, Apple and Facebook, including taxing profits where companies register their sales.[96] “International cooperation will also be important to continue the fight against international corporate tax avoidance and reduction in the corporate taxation rate, in line with the commitments made by countries to implement the minimum standards and recommendations agreed upon as part of the OECD/G20 Base Erosion and Profit Shifting (BEPS) project.”[97]

And, because multinationals have also seen their corporate tax rates fall so much in countries across the globe, this means “other actors in the economy” such as local businesses and citizens must pay even more in order to pick up the slack.^[98]

The key is resisting the “siren call” for more across-the-board tax cuts for the wealthy and corporations. Instead, it is important to address smart policy, and cooperation with other countries and international organizations to control and substantially reduce, if not stop, aggressive tax avoidance and ‘big money’ corporate and financial elite political influence of government leaders and required tax policy.[99]

Some countries, including Canada, have attempted to dramatically cut taxes on the wealthy and let corporate tax avoidance prosper. 

– Gabriel Zucman, Economist, Stanford University[100]

Top Marginal Rate of Taxation for the Ultra-wealthy

With respect to individuals, the answer is clear: look to the progressivity of personal income taxes. Since personal taxes are keyed directly to how much income an individual makes, personal taxes are an ideal way to tackle tax fairness:[101]

“One important feature of tax systems is the statutory rate of taxation that applies to the highest bracket of incomes. This measure, usually known as the ‘top marginal rate of taxation’, corresponds to the tax rate that applies to the ‘last dollar’ of income earned by the rich. … A common mistake is to interpret the top marginal tax rate as the effective rate of taxation applied to the rich. This is incorrect, because the top marginal rate applies (as the ‘marginal’ name suggests) only to the last portion of income earned by the rich. …

[T]he … reduction of top marginal income tax rates has been one of the ingredients contributing to lower effective tax rates for the rich.”

Today we are now seeing discussion and debate as to whether the top marginal rate on high incomes should shift back to what it was thirty plus years ago.[102] Polling has long shown that a majority of citizens in advanced countries believe the wealthiest citizens and corporations do not pay enough in taxes:[103]

“Recent polls have found that nearly 60% of voters [in the U.S.] are in favor of [a] 70% marginal rate on the ultra-rich [incomes exceeding $10 million]. (Many have also pointed out that [this] idea is nothing new. The US had a similarly high top tax rate between the 1930s and 1980s, a period of strong economic growth).”

The idea of hiking taxes on the richest Americans is having its moment. Leading Democrats in Congress, including some expected to run for president in 2020, are floating proposals. Respected experts on inequality are preaching the gospel of redistributing wealth. Even the country’s most prominent banker, JPMorgan Chase CEO Jamie Dimon, endorses the concept. And the public? They’re game, too — and by a wide margin. 

–  CBS News[104]

And setting aside historical context, the 70% figure is not a random number – it represents cutting-edge empirical research on how to maximize federal revenue.[105] The United States had many more tax brackets, and the top marginal tax rates were much higher in comparison to current rates. Under President Eisenhower (1953-1961), top earners paid a 91% marginal rate, falling to 70% under Presidents Kennedy (1961-1963) and Johnson (1963-1969), before falling to 50% after Ronald Reagan’s (1981-1989) first big tax cut, and then to 38% after the 1986 tax reform.[106] During these periods of strong progressive tax the economy was similarly strong:[107]

• The US economic growth rate has hovered near record lows over the past decade, even though tax rates for the ultra-rich have also been historically low.
• From 1957 through the 1970s, the tax rate was at 70% or above, yet the economy was markedly stronger during that period than it is now.
• The 35 years following World War II were the most economically prosperous in US history – and the tax rate was at or above the 70% rate currently being proposed by some politicians and academics.

MIT’s Peter Diamond (a Nobel laureate in economics and one of the world’s most respected public-finance experts) and Berkeley’s Emmanuel Saez relaunched this debate with a landmark 2012 paper[108] that supported a 73% top income tax rate in the United States. The paper presented the empirical case for tax progressivity based on optimal tax theory, and the point that “for the very rich, the subjective value of an extra dollar is essentially $0”, but that it has a measureable value to the middle and working class and vulnerable populations.[109] While professors Diamond and Emmanuel Saez’s report has long stood as a benchmark, new research has come out to challenge its findings – a notable example being a 2018 study out of Georgetown University that arrived at “49% as the optimal top tax rate”.[110]

Not convinced yet? Perhaps findings from Peter Diamond – a Nobel laureate in economics who is one of the world’s most respected public-finance experts – will do the trick.  Along with the inequality expert Emmanuel Saez, he coauthored an academic study in 2011 titled “The Case for a Progressive Tax: From Basic Research to Policy Recommendations.” And while the findings were quite complex, one number stuck out: 73%, the figure they arrived at when calculating the optimal tax rate for top earners.

– Business Insider[111]

From a policy perspective, the question that merits serious discussion is at what marginal tax rate should the “sweet spot” be implemented for top earners? In Canada the top marginal tax rate for both federal and provincial levies combined is 53.4%.  The rate by itself is not outlandishly high, compared to other countries – it is slightly lower than the top rate in France and Japan, for instance – but it stands out for the extremely low threshold at which it is applied:[112]

“France, for instance, applies its top tax rate only on incomes that are nearly 15 times the national average wage, which means it applies only to people that would be regarded as seriously wealthy.

In contrast, Ottawa levies its top rate on people who earn only slightly more than four times the average wage [Two-thirds of Canadian tax filers in 2016 fell into the lowest tax bracket, with taxable incomes below $45,282. The top 10 percent of Canadian income earners made more than $93,000 annually.].

This year, the top rate applies to income over $210,371, a threshold that can be reached by many doctors, dentists, small business owners and similar folks who fall short of qualifying as seriously rich. “The threshold is just too low,” Mr. Laurin [director of research at C.D. Howe Institute] says. He argues Ottawa should double the level at which the top rate bites, applying it only to income over $420,742. [note: The current top tax rate in the U.S. peaks at 37 percent on earnings above $510,300 for individuals and $612,350 for couples.[113]]

Such an adjustment might ease some the current tensions, but it is unlikely to end the broader argument over how the rich should be taxed or at what rate. Lars Osberg, a professor of economics at Dalhousie University in Halifax, points out that Canada and the United States grew rapidly in the 1950s and 1960s, with top tax rates that are much higher than now apply. Many of the current pleas for lower taxes are just alarmism, he says. …

Nor do tax rates by themselves say a lot about a country’s overall competitiveness. Prof. Osberg points out that many of the top-ranked countries in the most recent Global Competitiveness Report, compiled by the World Economic Forum, are highly taxed by most measures. Sweden, Denmark, the Netherlands and Germany all crack the top 10 in the rankings, ahead of Canada, which comes in at No. 12.”

What lessons can we take away from all this? Well, “that facts and details matter just as much as broad policy strokes”.[114]

Income Tax Rates for Corporations

The corporate income tax is under attack around the world, and the corporate sector has championed the reduction of the general corporate income tax rate as Western nations have struggled with budgetary deficits.[115]

Amazon will pay a whopping $0 in federal taxes on $11.2 billion in profits.

– Fortune Magazine[116]

One of the hallmarks of the era of ‘shareholder capitalism’ – the theory that corporations should be run to maximize shareholder value (i.e. “a system where greed is good”)[117] – is that every tax and every regulation is reflexively opposed by the business community as an assault on profits and shareholder value. By this logic, not only must corporations and their leadership teams commit themselves to putting shareholders first — but society, to its detriment, is expected to do so as well:[118]

“In the recent history of management ideas, few have had a more profound — or pernicious — effect than the one that says corporations should be run in a manner that ‘maximizes shareholder value’. …

The funny thing is that this supposed imperative to “maximize” a company’s share price has no foundation in history or in law. Nor is there any empirical evidence that it makes the economy or the society better off. What began in the 1970s and ’80s as a useful corrective to self-satisfied managerial mediocrity has become a corrupting, self-interested dogma peddled by finance professors, money managers and over-compensated corporate executives.

Let’s start with some history.

The earliest American corporations were generally chartered for public purposes, such as building canals or transit systems, and well into the 1960s were widely viewed as owing something in return to a society that provided them with legal protections and an economic ecosystem in which to grow and thrive. In 1953, carmaker Charlie Wilson famously spoke for a generation of chief executives about the link between business and the larger society when he told a Senate committee that ‘what is good for the country is good for General Motors, and vice versa’.

There are no statutes that put the shareholder at the top of the corporate priority list. … Cornell University law professor Lynn Stout has been looking for years for a corporate charter that even mentions maximizing profits or share price. She hasn’t found one.

Nor does the law require, as many believe, that executives and directors owe a special fiduciary duty to shareholders. The fiduciary duty, in fact, is owed simply to the corporation….

How then did “maximizing shareholder value” evolve into such a widely accepted norm of corporate behavior? … Today’s “activist investor” hedge funds, which have amassed war chests of tens of billions of dollars … created the imperative to boost near-term profits and share prices, an elaborate institutional infrastructure has grown up to reinforce it. This infrastructure includes business schools that indoctrinate students with the shareholder-first ideology and equip them with tools to manipulate quarterly earnings and short-term share prices.

It includes corporate lawyers who reflexively advise against any action that might lower the share price and invite shareholder lawsuits, however frivolous.

It includes a Wall Street establishment that is thoroughly fixated on quarterly earnings, quarterly investment returns and short-term trading.

And most of all, it is reinforced by gluttonous pay packages for top executives that are tied to the short-term performance of the company stock.

The result is a self-reinforcing cycle in which corporate time horizons have become shorter and shorter. The average holding periods for corporate stocks, which for decades was six years, is now down to less than six months. The average tenure of a public company chief executive is down to less than four years. And the willingness of executives to sacrifice short-term profits to make long-term investments is rapidly disappearing. …

The real irony surrounding this focus on maximizing shareholder value is that it hasn’t, in fact, done much for shareholders.

Roger Martin, the outgoing dean of the Rotman School of Management at the University of Toronto, calculates that from 1932 until 1976 — roughly speaking, the era of “managerial capitalism” in which managers sought to balance the interest of shareholders with those of employees, customers and the society at large — the total real compound annual return on the stocks of the S&P 500 was 7.6 percent. From 1976 until the present — roughly the period of “shareholder capitalism” — the comparable return has been 6.4 percent.

Obviously, a lot of other things happened during those two periods that could have affected returns to shareholders. One thing we know is that less and less of the wealth generated by the corporate sector was going to frontline workers. Another is that more and more of it was going to top executives. According to Martin, the ratio of chief executive compensation to corporate profits increased eight-fold between 1980 and 2000. Almost all of that increase came from stock-based compensation. …

For too many corporations, “maximizing shareholder value” has also provided justification for … squeezing suppliers and employees, avoiding taxes and leaving communities in the lurch. For any one profit-maximizing company, such behavior may be perfectly rational. But when competition forces all companies to behave in this fashion, it’s hardly clear that society is better off. …

The companies may also find that government no longer has sufficient tax revenue to educate workers or invest in the roads and ports and airports through which their goods are delivered to market.”

In today ‘s environment of ‘big money’ corporate influence, politics matters – and not surprisingly, the large national and multinational organizations’ objective is to gain support for tax policy that support lower taxation rates and maintain opportunities for tax avoidance. Governments in some advanced countries where these companies have significant political influence will support these efforts.[119] The top three countries with the highest corporate tax rates in the OECD – the U.S., France, and Belgium – have all introduced proposals to lower their corporate tax rates in a bid to make their regimes more “competitive” in the global marketplace. As well, Australia’s government has appealed to lawmakers to back its “flagship plan” to cut corporate taxes as it seeks to respond to reductions in both U.S. and UK corporate tax rates.  This all begs the question – have we indeed entered a “race to the bottom”[120]:[121]

“Would a global tax race of beggar thy neighbour by cutting company tax be good for [countries such as the U.S., Canada, the UK, the EU, or] Australia? The answer clearly is no. The best thing that a country … could do is to try to use [their] influence on the international stage to make sure that doesn’t happen. It’s best to stop it.

But in such a world, would [any country] be advised to join the corporate tax cut war? According to [economics professor Stephen] King: ‘That’s a bit like asking the next lemming should you jump off the cliff as well’.”

Apple, Google, Starbucks, and companies like them all claim to be socially responsible, but the first element of social responsibility should be paying your fair share of tax. Instead, globalization has enabled multinationals to encourage a race to the bottom, threatening the revenues that governments need to function properly.

– Joseph Stiglitz, Nobel Laureate in Economics[122]

So we know why political parties and governments continue to lose important tax revenue on “corporate giveaways”, but as noted by many commentators, “something’s got to give. This race to the bottom means governments have less and less revenues to invest in the social fabric of their nations — a social fabric that corporations depend on just like the rest of” society.[123]

Nevertheless, the most striking issue in tax policy across the globe has been the inexorable decline in corporate tax rates: “between 1985 and 2018, the global average has fallen by more than half, from 49% to 24%”.[124]  Similar to the top rate of taxation for the ultra-wealthy, corporate tax rates have also been reduced repeatedly over the same time period, with the “amount of tax most big companies pay” dropping as a proportion of their profits. In Canada the last year that corporations paid as much income tax as its citizens was 1952, and today – when comparing income tax alone – taxpayers in Canada paid “3.5 times more than all corporations”.   As bluntly put by one news organization, “between 1997 to 2016 Canada’s corporate income tax rate was cut almost half, from 43% to 26.7%” and “while Canadian governments have trouble coming up with cash for public services, Canadian companies are rolling in dough”.  Canada taxes the giant “oil and gas companies at a fraction of the rate they are taxed abroad” (i.e. at a loss of billions of dollars in tax revenue),[125] and “among Canadian corporations, one sector emerges as the most profitable” while paying “the lowest taxes – banks”:[126]

“Last year, Canada’s Big Five banks — BMO, CIBC, RBC, Scotiabank and TD — occupied the top five slots on Report on Business Magazine’s Top 1000 ranking of the country’s most profitable companies. Collectively, they booked $44.1 billion in pre-tax profit. (Their just-reported 2017 profits were even higher.)

That same year, the Star/Corporate Knights analysis found those five banks avoided $5.5 billion in tax.

This was not a one-off. Over the past six years, while the Big Five [banks] have been posting record profits, the tax rate they paid has dropped.

According to Statistics Canada, pre-tax profits in the banking sector as a whole soared by 60 per cent from 2010-2015. During that period, the sector’s tax rate (taxes paid divided by pre-tax profit) has dropped by almost the same amount.”

The issue is rekindling an old debate between advocates for a progressive wealth tax who say it would raise federal revenue while shrinking the gap between rich and poor, and detractors who argue it would demoralize “job creators” and discourage investment. 

– Megan Cerullo[127]

Historically, businesses have argued that raising corporate tax will hurt investment and growth. However, outside of extreme levels of taxation “history shows no real link between tax rates and economic growth”.[128] Corporate tax cuts are unlikely to stimulate the level of economic growth (i.e. job creation, wage growth) because generally corporate tax rates are not pushing much investment out of most advanced economies “in the first place”. Rather economic researchers suggest that multinational and national corporations are avoiding tax by sheltering approximately 40% of their profits – an admittedly conservative number[129] – in tax havens thereby “depriving their domestic governments of tax revenues and enriching” their “shareholders”:[130]

“That number suggests a jarringly large amount of what appears, to policymakers, to be investment pushed abroad by high tax rates is instead an accounting trick — so-called paper profits — which tax cuts will not reverse.

‘This idea that if you cut taxes, you’ll attract a lot of physical capital, a lot of investment to the United States, I don’t think is supported by the evidence,’ said Gabriel Zucman, an economist at the University of California, Berkeley. … The research by Mr. Zucman and Thomas Torslov and Ludvig Wier of the University of Copenhagen does not imply that corporate tax cuts will not help companies or lead to at least some new investment. But it challenges the magnitude of the increase [political parties promise] …

Throughout the debate over the [U.S.] tax bill, Republicans cast the country’s corporate tax rate as uncompetitive when compared with nations such as Ireland and Canada, and said the rate was pushing American multinationals to park their profits in other countries where their tax bills would be lower.

The new research concludes that assumption is wrong. ‘Machines don’t move to low-tax places,’ the economists write, “paper profits do.” …

Large corporations like Apple, Google, Nike and Starbucks all take steps to book profits in tax havens such as Bermuda and Ireland. Their strategies have prompted a crackdown by government regulators, particularly in the European Union, where officials have tried to force companies to pay back taxes they believed are owed to their countries. Mr. Zucman said his research suggested that officials should step up those efforts.

‘It’s very striking in the sense that these multinational companies, they are the main winners from globalization. And they are also those who have seen their tax rates fall a lot,’ Mr. Zucman said. ‘This means that other actors in the economy, they have to pay more in order to take up the tax burden.’

Mr. Zucman said the results should cause policymakers to rethink their efforts on several fronts. They suggest, he said, that advanced countries are underestimating economic growth and undercollecting corporate tax revenues, because they are missing the profits that have been shifted on paper by multinational corporations.

Kimberly Clausing, an economist at Reed College who has written and researched extensively about the scope of shifting profits to tax havens, said the research demonstrated that ‘the decline in the corporate tax is a result of policy, not an inevitable feature of the global economy. This implies that policymakers have the ability to address this problem without losing out in a tax competition game against other countries. But they must have the will to tackle tax havens themselves, instead of directing their fire at other non-haven countries.’ …

Mr. Zucman said it was too soon to tell whether those measures would succeed. But he said it was clear that policymakers should worry less about outdoing their allies with corporate tax cuts, and instead consider steps to crack down on profit-shifting, such as taxing profits where companies register their sales.”

Perhaps the most striking development in tax policy throughout the world over the last few decades has been the decline in corporate income tax rates. Between 1985 and 2018, the global average statutory corporate tax rate has fallen by more than half, from 49% to 24%. In 2018, most spectacularly, the United States cut its rate from 35% to 21%.

– The Missing Profits of Nations, National Bureau of Economic Research[131]

Using Canada as an example, this appears to be borne out as “deep corporate-tax cuts came at the price of” increased public debt and “foregone public investments in areas such as infrastructure, research, education and skills that could have contributed more to productivity growth”[132]:[133]

“StatsCan numbers show that drastic cuts to the corporate income tax rate over the last 20 years have not stimulated new business investment.

Between 1997 to 2016, Canada’s corporate income tax rate was cut almost in half, from 43 per cent per cent to 26.7 per cent. But investment in machinery and equipment and in intellectual property is still below the 1997 level as a per cent of GDP.

“[Corporate tax cuts] were supposed to incentivize greater job creation and investment. This didn’t happen,” said UNIFOR economist Brennan. “And we’ve seen a massive uptick in activities that are hard to classify as productive: stashing cash on the balance sheet, share buy backs, massive increases in executive compensation and a huge increase in merger activity. That’s not what was supposed to happen.”

The also evidence supports the finding “that increasingly a larger fraction of income to corporations is related to excessive profits,” and that “lower tax rates encourage firms to engage in more excessive profit seeking”. According to Joseph Stiglitz, a Nobel Laureate and Professor at Columbia University, the result is “greater incentives to create more monopoly power, to lobby (the government)”:[134]

“The result of these ‘trickle down’ policies which started in the 1980s is now clear: income and wealth have boomed for a tiny fraction of the population, but this has not benefitted the rest of the population at all. We must learn the lessons from this big natural experiment. The main lesson is that to have broad-based growth, we need an equitable tax system, where big corporations and high-earners in the financial industry and elsewhere pay their fair share — otherwise Trumpism will prevail.”

Peter Nicholson, former Finance Canada deputy minister, says Canada has implemented a market friendly tax rate, but failed to reap the rewards in productivity and innovation: ‘I think corporate behaviour is generally driven more by opportunity and competition than by tax rates per se. … I don’t think raising or lowering taxes has a hell of a lot of influence on where companies invest”.

– The High Cost of Low Corporate Taxes, Toronto Star[135]

Policy Measures

Crony capitalism,[136] corporate tax avoidance,[137] polarization and partisanship is tearing the social, economic, and political fabric of Western societies, and as these divides deepen and lead to seismic upheavals (i.e. Trump, Brexit, geopolitical tensions, Us versus them, the rise of far-right extremism), it appears we have lost the sense of ethical and social obligation to others that was crucial to the rise of post-war social democracy and a strong and inclusive society. The social contracts that hold societies together are fraying.[138]

Staying within the boundaries of tax policy, most recently France has sounded the “alarm for the world’s advanced economies” pushing for a correction “that includes minimum global taxes and higher levies on tech giants like Amazon and Facebook”.[139] There seems to be an emerging sense that a new balance needs to be established, a corporate tax framework that better understands and incorporates stakeholder expectations and is supported by diverse societal players.[140] So what should this correction look like – what constitutes an acceptable level of corporate conduct and taxation?

Crony capitalism refers to capitalist society that’s based on the close relationships between business people and the state. Instead of success being determined by a free market and the rule of law, the success of a business is dependent on the favoritism that is shown to it by the government in the form of tax breaks, government grants and other incentives.

– Investopedia[141]

It is clear that policy measures are required to redress the distortions that have arisen as multinational and powerful national corporations have left nationally based tax regimes floundering.[142] So, how can this “race to the bottom” tax policy be reversed? Five key measures include (1) increasing global cooperation; (2) increasing regional cooperation; (3) protecting corporate income tax; (4) reducing the influence of vested interests;[143] and (5) imposing a minimum corporate tax rate.  Addressing vested or special interests – and their ‘big money’ political influence – will be the hardest battle:

• Increasing global cooperation:[144] Governments must call for a new generation of international tax reforms aimed at putting a halt to the continued erosion of corporate taxation rates. In recent years, the International Monetary Fund has been more willing to take on harmful corporate tax competition. In 2014, an IMF working paper concluded that the effects of one country’s tax rules and practices on others (‘international tax spillovers’) are significant and that the institutional framework for addressing this is weak: ‘…as the strength and pervasiveness of tax spillovers become increasingly apparent, the case for an inclusive and less piecemeal approach to international tax cooperation grows’.  IMF director Christine Lagarde stated in 2014 that ‘there would be more revenue for all if countries resisted the temptation to compete with each other on taxes to attract business. The OECD and the G20 need to follow this lead by prioritizing and tackling the corporate tax race to the bottom (i.e. a global tax body to lead and coordinate international tax cooperation, a minimum corporate tax level). The broader the economic grouping of countries engaged in this dialogue, the greater the effectiveness of any solutions proposed, since this would minimize any displacement of corporate activities to jurisdictions with harmful tax practices outside of the participating countries.
• Increasing regional cooperation:[145] In all regions across the world problematic tax incentives have risen up the political agenda. Tax incentives generally serve special interests (read corporations and the financial elite), and often they are formed in response to competition within a region that would be better served by a political and cooperative approach, rather than a technical and unilateral one. Some regions have taken significant steps towards common solutions. Looking at the EU for example, although direct taxation is not harmonized across the region, there are increasing efforts to coordinate against tax avoidance and evasion, and there have been concerns expressed about tax competition.
• Protecting corporate income tax:[146] Although one country’s actions can be influential in curbing harmful tax practices, it is difficult for the actions of any single country to eliminate harmful tax practices. For many reasons, individual countries may not have a strong incentive to take action against harmful tax practices as they can worsen their own position relative to where they would have been if they had not acted at all. Sovereignty is shrinking in a regional or global system that promotes ‘beggar thy neighbour’ taxation policies. Many multinational corporations make use of tax havens, and many governments do not have the political courage or wherewithal to refuse to bend to the demands of powerful corporations. The defence of corporate income tax policy requires strong leadership, political courage, and a co-ordinated multilateral approach (i.e. international support and cooperation). Multinational corporations should be required to be transparent in the format of publishing country-by-country reports for each country in which they operate. A global tax body is required to oversee the global governance of international tax matters, while respecting democratic national sovereignty on taxing multinational companies. Until such time that a global forum may be created, all countries and global institutions (i.e. UN, IMF, World Bank, OECD) should work towards an agreement on how to curb the corporate tax race to the bottom and to ensure companies pay their fair share of tax.
• Reducing the influence of vested interests: Governments and relevant international institutions should seek to work together to end the race to the bottom on corporate tax rates. Corporate tax rates need to be set at a level that is fair, progressive and contributes to the societies and communities in which they operate.  As is the case with many issues of corporate responsibility, it is not just regulation, but values, that must shape the tax behaviour of companies. This is tax responsibility beyond legal compliance – it requires corporate conduct that reflects a company’s broader duties to all of its stakeholders, including contribution via taxes to public goods on which it may itself depend (note: see more on this point under the ‘Corporate Social Responsibility’ section below).
• Minimum corporate tax rate: The OECD has recently advocated a global minimum corporate tax rate to stop the “chase to the bottom on taxation” and set a floor for tax competition. Such a policy would be effective to curtail the capacity of (a) multinational corporations to “influence” individual political parties and governments to reduce corporate tax rates or overlook aggressive tax avoidance schemes, and (b) governments to ‘poach’ the tax base of other jurisdictions (i.e. beggar-thy-neighbour, and ultimately beggar-thy-self). A minimum corporate tax rate of 25% would be appropriate in all the circumstances, but political trade-offs will likely land the number somewhere between 12.5% and 19%. A minimum corporate tax rate would contribute to levelling the economic playing field. While this may limit the de jure fiscal sovereignty of states to an extent (i.e. they could not levy a lower taxation rate, although they could levy a higher one), it would boost the de facto sovereignty of states (i.e. enhancing the effective fiscal autonomy and reduce economic distortions).[147]

Due to the mobility of functions within multinational enterprises, and the availability of jurisdictions where those functions can be treated as profit centres without becoming liable for significant amounts of tax, multinational corporations are well positioned to organize their affairs to influence governments to reduce corporate tax rates and to minimize their tax bills through various tax avoidance schemes. This systemic weakness in the global tax systems demonstrates clearly that, to maintain an appropriate rate of corporate taxation – and to tackle corporate tax avoidance – in a globalized economy, governments must fundamentally reform corporate tax rules on an equally global scale. Unfortunately, for the foreseeable future there will continue to be an inconsistent international tax system with incomplete regulation and much room to manoeuvre for corporations and their leadership teams.[148]

At the end of the day, it is clear that the ultimate global risk is for geopolitical divisions to harden. The “world has moved into a new and unsettling geopolitical phase – multilateral rules-based approaches have been fraying, and re-establishing the state as the primary locus of power and legitimacy has become an increasingly attractive strategy for many countries, but one that hinders solutions to global issues that cross borders”.[149]  While there is room to make improvements to our national and global systems of taxation, unless we find a way restore global cooperation and appropriate corporate culture and behaviour there is little likelihood there will be a true solution to these taxation challenges.[150]

If it were simply the law that was at fault, that would be relatively easy to change. Changing a behavioral norm — particularly one reinforced by so much supporting infrastructure – is much more difficult.[151]

Customers and users should demand that corporations pay a reasonable tax liability and demand that the OECD initiate a list of companies who refuse to fully disclose their tax schemes and tax liability. The public has more power than is generally perceived due to the power that negative publicity has on a corporation competing in the current CSR landscape.

– Corporate Social Responsibility and Taxation: A Chance to Develop the Theory [152]

Corporate Social Responsibility (CSR)

Corporate social responsibility (CSR) and purpose encompass dual objectives – pursuing benefits for the business and for society.  Like business ethics, “the term CSR is used in multiple, and not always compatible, senses. Definitions vary, and in fact many supposed definitions of CSR do not read like definitions at all”. CSR may best be understood as the field that examines a company’s social responsibilities – that is, not just responsibilities to particular stakeholders, but also to society “as a whole”.^[153]

CSR is about a corporation building trust and reputation by contributing to the health and welfare of the organization and society, operating transparently and ethically.^[154] Three main factors support this shift:^[155]

• Stakeholders (i.e. employees, customers, the general public, governments) are pressuring companies to play a more prominent role in addressing critical challenges – such as economic inclusion, climate change, diversity, and taxation^[156].
• Investors are increasingly focusing on companies’ social and environmental practices as evidence mounts that performance in those areas affects returns over the long term.
• Standards are being developed for which environmental, social, and governance (ESG) topics are financially material by industry, and data on company performance in these areas is becoming more available and reliable, increasing transparency and drawing more scrutiny.

Society is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. … Mr. Fink’s declaration is different because his constituency in this case is the business community itself. It pits him, to some degree, against many of the companies that he’s invested in, which hold the view that their only duty is to produce profits for their shareholders, an argument long espoused by economists like Milton Friedman.

– New York Times, Blackrock’s Message: Contribute to Society, or Risk Our Support^[157]

Committing to a purpose and having a positive social impact is increasingly central to good management and shareholder value.[158]  “Trust, not money, is the currency of business” – generating “tangible business benefits, with measureable fiscal and non-fiscal impacts”.^[159] In a 2018 letter to chief executives of the world’s largest public companies, Laurence Fink, the CEO of BlackRock (the world’s largest investment firm of more than $6 trillion), discussed “environmental, social and governance issues” and, in doing so, significantly contributed to the debate over corporate social responsibility. The BlackRock CEO’s letter was written in “the context society’s rising expectations for companies. People are demanding that companies have a social purpose and demonstrate leadership on key issues”. And, according to this business leader, “they are right to: without a sense of purpose, no company, either public or private, can achieve its full potential or meet its obligations to society”.^[160] In Mr. Fink’s annual letter to CEOs he warned corporate leaders to start accounting for the societal impact of their companies, embrace a long-term approach in business, and specifically noted that businesses have a responsibility to the communities they serve, not just to their bottom line since “profits and purpose are inextricably linked”.[161]

Companies that fulfill their purpose and responsibilities to stakeholders reap rewards over the long-term. Companies that ignore them stumble and fail. This dynamic is becoming increasingly apparent as the public holds companies to more exacting standards. 

– Larry Fink, Chairman and CEO, BlackRock, 2019 Letter to CEOs[162]

In this context, it is generally accepted that corporations and their executive and board leadership have a social responsibility to look beyond the company’s narrow economic interests and consider the effects that their decisions have on all corporate stakeholders, including the general public. Today, almost all multinational corporations promote CSR as a core area of management and feature some type of CSR report.[163]

It is trite to say that paying taxes is the most elementary responsibility towards the state and the people who reside therein.[164] Accordingly, a corporation paying its’ “fair” share of taxes should become a required element in today’s business environment[165]:[166]

“It seems strange, in an era where companies are placing a greater emphasis on their contribution to society, that tax avoidance has become so prevalent and such accepted practice. It would be naive to believe there will ever be a time when all companies cease attempting to avoid tax. Whenever there is a system, there will always be those who seek to subvert it. But surely if we are to take any company’s claim to be socially responsible seriously, we must at least expect it to begin by paying its fair share of taxes.”

An “historical look into CSR reveals that corporate activities previously viewed as generous and socially responsible, such as ensuring humane working conditions, providing decent housing or healthcare, and donating to charity, are now corporate standards that we cannot imagine the world without”. The next “evolution in CSR development” should be “tax fairness,” meaning that corporate executives and boards of directors must be socially responsible by ensuring their corporation pays a fair and reasonable tax rate and prohibits inappropriate corporate lobbying and aggressive tax avoidance schemes by its leadership teams.[167]

Companies that treat social issues – including corporate taxation and tax avoidance – as either irritating distractions or simply unjustified vehicles for an attack on business are turning a blind eye[168] to impending forces that have the potential to fundamentally alter their strategic future.[169] 

[L]ooking further into CSR, paying the “fair” share of taxes should become a required element in today’s business environment.

– Corporate Social Responsibility and Taxation[170]

Tax responsibility is becoming intertwined with the expectations of CSR, corporate integrity and leadership, and avoiding corporate taxes is simply socially irresponsible.[171]  CSR and tax responsibility should go hand in hand because so many companies are facing intense scrutiny for their tax practices, and negative publicity in a media-driven world can directly impact financial results:[172]

“An effective CR response to tax planning must be based on three insights: (1) compliance with the letter of the law is no longer sufficient to protect business from the risks associated with tax planning; (2) lack of transparency around tax planning leads to increased risk; (3) it is the structures and practices of tax planning that are at the heart of tax responsibility, rather than the amount of tax paid, which is an outcome of these practices. Businesses should … ensure board level oversight of internal tax policymaking. …

The growing public interest in the taxation of multinationals means that it is not tenable for any government to impose or increase taxes on ordinary people while there is a perception that the burden is not also falling on businesses and elites. Such situations in the past have contributed to significant political instability … .  By acting now, businesses have an opportunity to demonstrate a forward-thinking approach and commitment to corporate responsibility.”

Public opinion is at present crystallising around the notion that companies should pay their ‘fair share’ of tax, which for many people precludes the use of aggressive ‘big money’ lobbying (influencing the law) and tax avoidance.[173] Companies are facing calls for more transparency on their tax practices, and in particular for a country-by-country breakdown of financial results. There are proposals for both voluntary and mandatory country-by-country reporting, with governments in the EU, G20, and the OECD expressing interest in these ideas.[174]

Tax is becoming an important source of reputation risk. Increasingly, businesses are weighing up whether they are vulnerable to attack and how they should respond if they become the target of a campaign. The risks might seem limited by the dry, complex nature of corporate tax planning, which does not lend itself to eye-catching campaigns. But over the past decade campaigners have begun to focus on it with the same zeal as they apply to more immediately emotional issues such as the environment or child labour.

– Financial Times[175]

Tax planning presents a growing risk to businesses. In developing a CSR response, corporations and their leadership teams can learn from the experience of integrating other CSR issues: “defining and communicating a position, ensuring high level oversight and responsibility, becoming more transparent, and developing a shared set of principles between stakeholders”:[176]

“The growing debate around corporate responsibility in the area of tax planning presents businesses with an opportunity to showcase their commitment to corporate responsibility, and their approaches to risk management. The challenge now is to translate this commitment into concrete steps that contribute to a positive vision of tax responsibility.”

In order to tackle the issue of CSR and taxation, it appears that a new standard may need to be created that “allows corporations to be certified at different levels of CSR activity that is contingent on their CSR towards taxation”:[177]

“Companies are constantly competing in order to maximize returns and achieve success. This paper suggests a new standard for CSR that includes tax practices because taxes are the most basic way in which corporations can positively engage in society. The public’s opinion about whether or not a corporation is socially responsible is a powerful criterion that has a direct result on positive or negative financial performance. …

The recent election results in the United States taught us that the public is upset, frustrated, and even angry to some extent. Many people feel that they are not being represented or heard. When people hear that the economy has picked up and the future is bright, but this is not reflected in their personal financial status, while at the same time they hear about corporations who are making billions while not carrying the burden of taxes, they begin to care about CSR, and want these corporations to care. For many individuals here in the United States, it is clear that there are different worlds for big corporations and little people, and they feel misrepresented. The time to create awareness among the public with regards to corporations’ responsibility to pay their fair share in taxes is never better than it is now. The way to create such awareness is by talking about it, writing about it, and making people understand the situation and the importance of fair taxation within CSR. The responsibility is not only on scholars.

Politicians can and should raise this issue and demonstrate the link between corporate tax and corporate social responsibility and push for cooperation, and not just enforcement, when it comes to taxing corporations. It is time for statements, such as the one that described Google as ‘contributing to an unacceptable culture of irresponsibility,’ and others that were made at the U.K. parliament, to be heard here in the United States [Canada, Australia, the EU, etc.] by our own politicians.”

One of the reasons why we’ve seen an erosion of trust broadly in big companies is they’ve allowed themselves to be seen as being detached from society and they will float in and out of societies according to what the tax regime is. I think that’s completely wrong.

– Andrew Witty, CEO GSK, 2008-2017[178]

Business leaders “should not fear their greater advocacy of the contract between business and society. More than two centuries ago, Rousseau’s social contract helped to seed the idea among political leaders that they must serve the public good, lest their own legitimacy be threatened. The CEOs of today’s big corporations should take the opportunity to consider, restate and reinforce their own social contracts in order to help secure, for the long term, the invested billions of their shareholders”.[179]

Multinational companies should “adopt clear CSR standards in the area of taxation, including requirements to publish all necessary accounting information and to refrain from the use of profits-laundering vehicles created without substantial economic purpose. CSR reports should list the countries in which the company trades, how much profit is derived from activities in each of these countries, and where these profits are booked for tax purposes, indicating any special purpose vehicles that are used, and the extent of tax avoidance arising from the use of ‘novel tax planning ideas.’ Only in this way can the relevant stakeholders, including governments, shareholders, employees and the general public obtain the data they need to determine whether the organizations that dominate the globalized economy are acting as good corporate citizens”.[180]

Adam Smith said that taxes should be efficient, certain, convenient and fair. Against that standard, today’s tax policies are unforgivably cack-handed. Politicians rarely consider the purpose and scope of taxation. … Rewriting the codes means winning over sceptical voters and defying rapacious special interests. It is hard work. But the prize is well worth the fight. 

– The Economist[181]

‘Big Money’ influence over Political Parties and Governments

Too often ‘big money’ appears to call the shots, with politicians across the spectrum frequently guilty of unduly favouring the demands of their ‘big money’ corporate and financially elite donors over the needs of their constituents. Some studies have found corporations and the billionaire economic elite have obtained as much as a 22,000 % return on their financial investment into politicians and the political system.[182]

Today, many companies are larger economic entities (with potentially greater influence) than the countries in which they operate.[183] Individually, the richest 1% own half the world’s wealth[184] – eight individuals own the same wealth as the poorest 3.6 billion people,[185] and three billionaires own as much wealth as half the population of the United States.[186] In 2018 billionaire fortunes increased by 12% – or $2.5 billion a day – while 3.8 billion people saw their wealth decline by 11%.[187]

Many companies are larger economic entities and with potentially greater influence than the countries in which they operate. According to one estimate, 69 of the top 100 wealthiest economic entities in 2016 were corporations, not countries.

– KPMG[188]

In this environment of accelerating socioeconomic inequality and weak institutional safeguards, a major concern is the unjustifiable and disproportionate influence that corporate business interests and the ultra-wealthy have on government policy making,^[189] particularly in the United States.^[190] A U.S. Senator has admitted that “career politicians’ ears and wallets are open to the highest bidder”,^[191] and a former Vice President of the United States has stated on the record that “American democracy has been hacked”, that the United States Congress “is now incapable of passing laws without permission from the corporate lobbies and other special interests that control their campaign finances”.^[192] Corporate special interest groups that are prepared to invest a lot of money in a particular political issue will often beat the broader national interest.^[193] A recent recording revealed oil industry executives laughing at their high-level executive branch access,[194] and in 2018:^[195]

“Mick Mulvaney, the White House budget director and acting head of the Consumer Financial Protection Bureau, told lobbyists … what they already knew: Legislators are dependent upon their funders, and their funders are not the people.

Speaking to 1,300 attendees of the American Bankers Association conference, Mulvaney … pleaded with the bankers to use that insight to get Congress to dismantle the consumer protection agency that he now heads. …

But while this economy of influence of D.C. has been well-known among its players for some time, what is striking now is how open the players have become about sharing this corruption with the public. The only way to break this culture is through radical changes that change how we fund our elections. …

It cannot be that a system so dependent upon such an unrepresentative few could ever represent the many fairly or effectively. That is the fundamental underpinning of our representative democracy, and that is the simplest way to see its corruption. James Madison [the fourth President of the United States] promised a Congress “dependent on the people alone,” yet Madison’s promise is a fantasy today. Congress is dependent not on the people alone but on the funders of campaigns. …”

Scandals and inappropriate influence involving money in politics have affected countries in every region of the world, from the U.S. to the EU and from the UK to Canada and Australia. These scandals fuel distrust in democratic institutions, undermine the integrity of the political system by making the policy process vulnerable to capture, and delegitimize democracies. ‘Big money’ provides a disproportionate advantage to a selected few (corporations and the financial elite), and creates an uneven playing field for the middle and working class, and marginalized communities.[196]

Not surprisingly, there is “an urgent need” to understand and be informed of what money and other incentives (i.e. future jobs) powerful corporate, financial elites, and their “political lobbyists are giving law makers who are writing relevant tax legislation”.^[197]

[G]overnments are implementing a series of corporate tax cuts that deplete public revenues by billions of dollars every year. So while ordinary Canadians are being told there isn’t enough money for transit or education or health care, the wealthiest companies are getting bonus tax cuts.

– Toronto Star[198]

‘Big money’ – including untraceable ‘dark money’ – appears to permeate, polarize, and undermine the world’s political and government systems,[199] introducing influential private interests where only the public interest – the common good that benefits society as a whole[200] – should be considered.[201]  To often corporate ‘big money’ appears to call the shots, with politicians across the spectrum frequently appearing guilty of unduly favouring the demands of their ‘big money’ corporate and financially elite donors over the needs of their constituents and the citizens of their countries:[202]

“A society that allows a situation like this to exist is … showing the advanced signs of democratic decay.

Such decay doesn’t just happen in a vacuum: this sort of growing inequality – and it is a worldwide phenomenon in developed countries, including Australia – happens because politicians make choices. And the choices they make are what they are because those making them are more influenced by the rich and powerful than they are by the rank and file.

This in turn happens because the institutions that allow all of us to have a say in policy – everything from political parties to sections of the media – are no longer representative of the broader public but have become captives of powerful special interests.

It is not just a case of direct economic policies lowering taxes on the wealthy and redistributing national wealth upwards – though that happens in spades.

Something more insidious is at work. The very tools we use to assert ourselves as citizens against these special interests are themselves attacked and undermined. In the US, not only does corporate money corrupt the legislative process, but there are concerted efforts to rig the game before anyone actually gets to Congress. This is done by gerrymandering congressional districts and by enforcing voter identification laws aimed at discouraging disadvantaged groups from voting at all.

And let’s not get too smug. Increasingly, Australian [and other] governments are looking to the United States as a source of inspiration. …

So we demonise government, we laud private enterprise unconditionally, we privatise everything in sight, we cut services because we have undermined our tax base with handouts and reduced rates to our richest citizens – corporate and otherwise – and we wonder why we are not happy with the outcomes, why inequality rises and why we increasingly feel powerless.

It isn’t rocket science … When the state retreats and its functions are replaced by private firms, political control shifts from elected officials responsible to the whole community to unelected managers responsible to their boards or shareholders.

Inequality – social, economic and democratic – is part of our more general disenfranchisement from the political process. It is about the exercise of power, who has it and who doesn’t.

It is always and everywhere predicated on a demonization of government, an unending process conducted by think tanks who take their funding from big business, or even media outlets who devote column after column to demonising government investment in everything from the ABC to the NBN. …

[W]e are currently getting the worst of both worlds: a private sector so powerful that it is essentially unaccountable, and a public sector drained of meaning and confidence.

More than a balanced budget, that is the scale we have to fix.”

“Corporate globalization” or “corporatocracy” refers to the “belief that corporations are the dominant political actors of our time”.[203] It has been noted that the defining feature of this concentration of private wealth and power “is the effort on the part of holders of this ideology to defund or de-provision public goods, in order to defang a state that they see as a threat to their prerogatives”. Practically speaking this “takes the form of efforts to lower taxes,[204] which necessitates the cutting of spending on public goods; to reduce regulations that restrict corporate action or that protect workers;[205] and to defund or privatize public institutions, such as schools, healthcare, infrastructure, and social spaces”.[206] The political strategy “is to use austerity in the face of economic shocks to rewrite social contracts on the basis of a much narrower set of mutual social obligations, with the ultimate effect of decollectivizing social risks”[207]  – the tax cuts benefitting the wealthy and corporations undermining needed tax revenue and contributing to and providing the deficit based “excuse for across-the-board cuts in domestic programs”.[208] Inequality gets worse, public investments vital to a country’s future are starved, the financial elite and corporations continue to receive tax cuts, and the middle and working class fall further behind.[209]

This triumph of the “one per cent” follows decades of cuts to the social welfare programs that strengthen the fabric of our society. According to a report by the OECD, Canada ranks 24th out of 34 countries in social expenditures as a percentage of GDP.

– The Conversation[210]

As a “palliative for the loss of public goods and state-backed programs to improve public welfare, plutocratic [and corporate advocates] typically promote the idea of philanthropy – directed toward ends defined not democratically but by themselves”.[211] In this respect, some financial and corporate special interests appear to advocate for equality – except in ways that threaten the social order and their position atop it. The hard question for governments and policy makers is why society’s gravest problems should “be solved” by corporate and financial special interests instead of the very public institutions they are undermining and eroding  by their lobbying, corporate ‘big money influencing of relevant legislation, and tax avoidance.[212]

For not the first time in geopolitics, “among us today a concentration of private power without equal in history is growing”[213] – and while “low taxes, light-touch regulation, weak unions, and unlimited campaign donations are certainly in the best interest of the plutocrats”, multinationals and tech giants, that “doesn’t mean they are the right way to maintain the economic system that created today’s super elite”.[214]

Across the globe we find ourselves in this situation because globalization and the digital economy has transitioned the landscape from a world ordered by geography (i.e. control over borders, national markets, and nations states) to one where geographical boundaries are diffuse and permeable, with decreasing relevance in respect to control over economic and political activities. And understanding that the “rules” have changed – that in many cases political and economic influence and power has shifted from nations to markets and multinationals –  requires a dramatic reconceptualization of what is meant by “political space”. As one commentator noted, “the centre of gravity in world politics has shifted” from “the public agencies of the state to private bodies of various kinds, and from states to markets and market operators”.[215]

Within this reality of corporate influence, the problem in large part is the “two megatrends” of “polarization and monetization of politics”.[216]  While it would be unwise to simply reduce the answer to just this snapshot, from a big picture perspective, the answer certainly includes the fact that our 20th-century political, social, and economic structures are drowning in a 21st-century ocean of (a) political parties and governments awash in corporate ‘big money’ influence,[217] (b) political polarization and partisan “zero-sum” ideology (that is disconnected from the wider society),[218] (c) widening economic inequality and cultural division, (d) deregulated finance, (e) globalization, (f) autonomous technology,[219] and (g) a changing employment landscape (i.e. job insecurity; underemployment, precarious and non-standard gig work; wage stagnation; polarization of labour market between high earners and everyone else).[220] These are profound changes that are impacting and transforming society in post-industrial economies.[221] There is growing anxiety and uncertainty about the future, and amid the political, economic, and social change many see not only less economic and social opportunity for themselves, but also for their children going forward.[222] This represents real costs to real people.[223]

About 75 percent of Americans favor higher taxes for the ultrawealthy. … The defining political fact of our time is not polarization. It’s the inability of even large bipartisan majorities to get what they want on issues like these. Call it the oppression of the supermajority. Ignoring what most of the country wants – as much as demagogy and political divisiveness – is what is making the public so angry.

– Tim Wu, Law Professor, Columbia University[224]

Corporations, billionaires and business interests who favor unpopular, ultraconservative economic policies – and work actively to advance them – stay almost entirely silent about those issues in public. This is a deliberate choice. These special interests have media access, but most of them choose not to say anything at all about the policy issues of the day. They deliberately pursue a strategy of “stealth politics” with certain politicians and political parties as their delivery mechanism.[225] And what happens when ‘big money’ political influence captures the regulatory and political process?  With examples across the world, including within the EU, the UK, Canada and Australia, the most concerning of late may be illustrated in the U.S.:[226]

“This is what happens when corporations run the government.

As the world was grounding 737 Max airliners this week, following the second crash involving the new jet in five months, the Trump administration, serving as a wholly owned subsidiary of Boeing, declared ‘no basis to order grounding’.

This from an administration and president that claim climate change is a hoax, radiation and pesticides are healthy, and that “raking” prevents forest fires.

When President Trump finally buckled to pressure and grounded the 737 Max on Wednesday, he said he ‘maybe didn’t have to’ but thought it important ‘psychologically’. …

… That was Boeing’s chief executive, a frequent visitor to Trump properties, phoning Trump with a plea not to ground both the 737 Max 8 and Max 9. That corporations make safety decisions for [political parties, politicians and some governments] … isn’t surprising. The acting head of the Federal Aviation Administration is formerly of American Airlines and of the Aerospace Industries Association, of which Boeing is a prominent member. Trump is expected to nominate a former Delta Air Lines executive for the top FAA job. His acting defense secretary is a former Boeing executive.

In [the current U.S. administration’s] broader corporatocracy, a former oil-industry lobbyist acts as interior secretary, a former pharmaceutical executive is health and human services secretary, and a former coal lobbyist runs the Environmental Protection Agency. Fully 350 former lobbyists work, have worked or have been tapped to work in the administration ….

The corporate hold over the government hurts U.S. credibility overseas. After the crash of one of its Max 8 airliners, Ethiopian Airlines opted to send the doomed plane’s black boxes not to the United States but to Europe. U.S. resistance to grounding the 737 Max raised worldwide concern about a “defiant” United States (Bangladesh), its credibility “eroded” because government is “too cozy” with business (Hong Kong) and is swayed by “corporate interests . . . to ignore reality” (Australia).  …

In addition, the billions of dollars that corporate executives invest in lobbying and campaign contributions have generated healthy returns: a corporate tax cut, an assault on regulations and unrelenting efforts to shrink enforcement. … Corporate victories keep coming. The Los Angeles Times just obtained emails showing that EPA officials moved to block NASA from monitoring pollution levels. Politico recently obtained data that showed that the Interior Department gave oil drillers nearly 1,700 waivers of safety rules implemented after BP’s Deepwater Horizon disaster in the Gulf of Mexico in 2010. The Union of Concerned Scientists has documented more than 70 “attacks on science,” many benefiting corporations: censoring scientific language, suppressing studies, weakening advisory panels and such. The group suspects “inappropriate corporate influence” in rolling back fuel efficiency, chemical and methane standards, repealing the Clean Power Plan, suppressing known health risks, expanding oil and gas leasing and bailing out the coal industry, among others. …

Like millions of Americans, I long trusted that the federal government tried to protect food, air, water and safety. … corporatocracy broke that trust.”

Our country today, and indeed much of the world, is run by and for billionaires [and corporations] actively manipulating the political process. They have the means, power, influence and muscle to get their way.

– Jeffrey Sachs, Professor and Economist, Columbia University’s School of International and Public Affairs[227]

In an age when we increasingly see business leaders filling the vacuum left by political leaders, it’s important that the public fully understand the views of these unelected leaders. A team of researchers working with the Harvard Law School program on corporate governance determined that the majority of leaders of large businesses side with conservative political parties (for example the Republican party in the U.S.), given their usual platform of lower taxes and less regulation. This has significant implications given how involved the business community has become in creating and influencing laws and public policy.[228]

There is nothing natural in the decline of corporate income tax rates and the top marginal rate of taxation of the ultra-wealthy. Vast sums of ‘big money’ in the form of “weaponized philanthropy”, political lobbying and even corruption fund the battles against taxes and other issues across the world.[229] As stated by Christine Lagarde, the managing director of the IMF:[230]

“The world is facing a crisis of trust in institutions across all sectors that shows no sign of abating. In 20 out of the 28 countries surveyed by the Edelman Trust Barometer for 2018, average trust in government, business, NGOs and media was below 50%.

There are many reasons behind this heightened sense of dissatisfaction – the long tail of the global financial crisis, a perception that economic rewards are not being shared fairly, and growing anxiety about future job prospects. But when I talk to young people all over the world, one theme comes up repeatedly: corruption – the abuse of public office for private gain. I am convinced that corruption both feeds on and is fed by the broader crisis of trust, which sustains a vicious cycle that undermines economic health and social cohesion.

By siphoning off precious reserves of trust, corruption makes it harder for society to take the collective decisions needed to advance the common good. The economic and social costs of corruption are clear. Consider, for example, the effects of corruption on the public accounts. It robs the tax system not only of revenues but of its very legitimacy.”

And, “for as long as socially destructive behavior is more rewarding than socially constructive behavior, things will get worse”.[231] 

Wealth concentration may help explain the lack of redistributive responses to the rise of inequality observed since the 1980s. The interplay between money and power, in other words, may be self-reinforcing: The wealthy use their money to buy political power, and they use some of that power to protect their money.

– Gabriel Zucman, University of California at Berkeley[232]

Conclusion

Progressive tax proposals have two goals: boost government revenue and reduce income inequality. Many historians, economists, and politicians argue that the latter priority is key to preserving democracy. They hold that as economic power is increasingly concentrated in a few hands, so too is political power, and that “high top tax rates” support democracy by “preventing an oligarchic drift that, if left unaddressed, will continue undermining the social compact and risk killing democracy”.[233] And, a progressive tax system that embraces appropriate corporate tax rates and the digital economy is central to the capacity of nations to fund their own growth. Corporate tax avoidance and uncontrolled reduction in corporate tax rates torpedoes this central platform of inclusive growth and is now a structural cause of growing domestic and global inequality.^[234]

All around the world, people have an overwhelming sense that something is broken. This is leading to record levels of populism in the United States and Europe, resurgent intolerance, and a desire to upend the existing order. The left and right cannot agree on what is wrong, but they both know that something is rotten.

– Jonathan Tepper and Denise Hearn^[235]

Tax policies in many western societies over the last thirty years have disproportionately benefitted the top one percent to the exclusion of working and middle class families – eroding security from working and middle class families and “consolidating power in the hands of the nation’s billionaires” and corporations “who are increasingly using their” financial power “to purchase political influence”.^[236] In this respect: “the greatest danger is that the truly rich are increasingly separated from the lives” of the working and middle class “so that they become largely insensitive to the concerns of those who still earn by the hour”. If that happens we may indeed begin to see increased social and economic upheaval, dislocation, division and polarization as the cost for this insensitivity.[237]

When corporations and wealthy individuals are perceived to “game the system” – and are increasingly seen as out of touch and unaccountable – it is hardly surprising that ordinary people who have been “playing by the rules become so angry that they will put their faith in anyone who promises to shake up the system”.^[238] And this is fertile ground for a deeply polarized and reactionary form of politics unsuited to the complex times in which we live.^[239] 

Unfortunately, signs of democratic discontent are particularly visible in Anglo-American democracies and other post-industrial societies.^[240] In this context, it may be fair to say that contemporary populism^[241] has taken a not so surprising twist of late, with rich country electorates in the U.S., the UK, and Europe opting for what appear to be the extreme alternatives to the status quo. Populist leaders are gaining support, votes and seats in Western countries.^[242]

Not that people are not trying. This means rethinking and modernizing and recapturing the intent of a progressive system of taxation involving corporations and the financial elite (ultra-wealthy).  This type of vision will require open-minded civil discussion, international collaboration, respect for a multilateral rules-based world,[243] and – most importantly – strong leadership from governments, international organizations, and business.

In this respect, corporations and their executive and board leadership have a legal and social responsibility to look beyond the company’s narrow economic interests and consider the effects that their decisions have on all corporate stakeholders, including the general public. Fortunately, as political lobbying and tax avoidance becomes more of a reputational issue for multinationals and the tech giants, at least some influential business leaders are beginning to recognize that at least the most appalling examples of corporate self-interest are “not a good look“.[244]

We can either have democracy in this country or we can have great wealth concentrated in the hands of a few, but we can’t have both.

– Justice Louis D. Brandeis, US Supreme Justice[245]

Ultimately, for any solution to take place – particularly in today’s polarized and fractured world order[246] – it will be critical to address the issues of ‘big money’ corporate and financial elite influence across the world, and for both government and business leaders to rebuild trust in international relationships. Although we live in a complicated world, “human beings wrote the rules of this game, so we decide when and how to change them”.[247]

Eric Sigurdson

Endnotes:

---

[1] Alex Himelfarb, Taxes: A Small price to pay for civilization, Alberta Views, January 1, 2015. Also see, Alex Himelfarb and Jordan Himelfarb (editors), Tax is Not A Four-Letter Word: A Different Take on Taxes in Canada, Wilfred Laurier University Press, 2013.

[2] Alex Himelfarb, Taxes: A Small price to pay for civilization, Alberta Views, January 1, 2015. Also see, Alex Himelfarb and Jordan Himelfarb (editors), Tax is Not A Four-Letter Word: A Different Take on Taxes in Canada, Wilfred Laurier University Press, 2013.

[3] Tim Dunlop, Inequality is a political problem, not an economic one, ABC News (abc.net.au), November 27, 2013. Also see, Max Lawson, etal, Public Good or Private Wealth?, Oxfam.org, January 2019.

[4] Tax reforms accelerating with push to lower corporate tax rates, OECD.org, May 9, 2018; Tax Policy Reforms 2018: OECD and Selected Partner Economies, OECD Publishing, 2018; Brian Peccarelli, As some major economies cut their corporate tax rates – what will happen next?, World Economic Forum, January 19, 2018; William Gale and Leonard Burman, Congress missed an opportunity to reform the corporate tax, Brookings.edu, December 26, 2017; Jessica Irvine, What economists really think about cutting corporate tax, Sydney Morning Herald, February 23, 2018; Shane Wright, Australia has world’s third highest corporate tax rate, Sydney Morning Herald, January 15, 2019; Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017; Jamie Smyth, Australia joins global push to cut corporate tax rates, Financial Times, February 8, 2018.

[5] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016.

[6] Esteban Ortiz-Ospina and Max Roser, Taxation, Our World In Data.org, 2019.

[7] Thomas Piketty, Save capitalism from the capitalists by taxing wealth: rising levels of inequality need to be addressed on a global scale, Financial Times, March 28, 2014.

[8] Dermot Egan, Does a company’s responsibility to society start with paying its taxes?, Guardian, September 9, 2011.

[9] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016.

[10] Oliver Wendell Holmes Jr, United States Supreme Court Justice, in the case of CompanIia General deTabacos de Filipinas v. Collector of Internal Revenue, 275 U.S. 87, 1927.

[11] Paying Taxes: Why it Matters – Why Do Tax Rates and Tax Administration Matter?, Doing Business.org (World Bank), 2018.

[12] Kelly Geraldine Malone, Barak Obama Tells Winnipeg Audience Politics Being Driven By Passion, Not Facts, Canadian Press (Globe and Mail, Huffington Post), March 5, 2019; Madeline Smith and Jenny Peng, Barack Obama reflective of presidency and addresses ‘toxic politics’, climate change in Canadian Tour, Toronto Star, March 5, 2019.

[13] Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019.

[14] Jeffrey Sachs, The Price of Civilization: Reawakening American Virtue and Prosperity, Random House, 2012. Also see, Nathan Lewis, The Crisis of Capitalism Is a Lack of Capitalism, Forbes, February 23, 2012.

[15] Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019.

[16] Eliza Relman, ‘2020 class warfare?’: Alexandria Ocasio-Cortez and the left face off against billionaires in a fight to tax the rich, Business Insider, February 2, 2019.

[17] Annie Lowrey, Jeff Bezos’s $150 Billion Fortune Is a Policy Failure: growing inequality in the United States shows that the game is rigged, The Atlantic, August 1, 2018.

[18] Kimberly Amadeo, Austerity Measures, Do They Work, with Examples, The Balance, December 27, 2018.

[19] Michael Hiltzik, American is falling out of love with billionaires, and it’s about time, Los Angeles Times, February 1, 2019. Also see, Pete Evans, Why companies flush with tax-cut cash are spending more on share buybacks than wage hikes, CBC News, August 4, 2018; Eric Levitz, Corporations Invested Their Tax Cuts Into Stock Buybacks That Didn’t Even Work, Intelligencer (nymag.com), July 9, 2018; Christian Weller, Supply-Side Follies: Wasteful Tax Cuts Will Not Boost the Economy, Center for American Progress, October 26, 2017; Jeff Sommer, Buybacks by Companies Like Apple May Signal Danger, Not Growth, New York Times, June 23, 2016; Reuters, Apple is lavishing cash on shareholders like no other company in history, Financial Post, May 2, 2018; Julie Berman, The Rich Are Hoarding Cash and It’s Making Us A Lot Worse Off: Experts, Huffington Post, August 7, 2013.

[20] Jared Bernstein, We Need a Truly Progressive Tax Rate, New York Times, July 28, 2015; Kevin Milligan, Progressive corporate tax reform? It’s not as crazy as it sounds, Macleans.ca, November 20, 2018.

[21] Alex Hemelfarb and Jordan Himelfarb, Canada’s dangerously distorted tax conversation, Toronto Star, October 6, 2013.

[22] Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019.

[23] Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019.

[24] 2018 Edelman Trust Barometer Global Report, Edelman.com; Margie Warrell, Who Can We Trust? Restoring Trust in our Institutions, Our Leaders and Each Other, Forbes, September 30, 2018; David Ryan, Do the right thing: Why business should fight for trust in the Age of Trump, Globe and Mail, November 19, 2018. Also see: Uri Friedman, Trust is Collapsing in America: when truth itself feels uncertain, how can a democracy be sustained?, The Atlantic, January 21, 2018; Christine Lagarde, The Role of Business in Supporting a more Inclusive Global Economy, Conference on Inclusive Capitalism, New York, International Monetary Fund, October 10, 2016; Klaus Schwab, Five Leadership priorities for 2017, World Economic Forum, January 2, 2017; Richard Edelman, A crisis of trust: A warning to both business and government, Economist, The World In.com, 2016; Jim Norman, Americans’ Confidence in Institutions Stays Low, Gallup.com, June 13, 2016; Clare Malone, Americans Don’t Trust Their Institutions Anymore, FiveThirtyEight, November 16, 2016; Jake Johnson, As Millions of Workers Face Pension Cuts Thanks to Wall Street Greed, Executive Benefits Remain Lavish, Common Dreams.org, April 29, 2016; Matt Taibbi, Looting the Pension Funds, Rolling Stone, September 26, 2013; M.B., Busted Trust: Faith in world leaders, Economist, January 23, 2012; James Crisp, Juncker admits Europeans have lost faith in the EU, EurActiv.com, April 19, 2016; Nathaniel Persily and Jon Cohen, Americans are losing faith in democracy – and in each other, Washington Post, October 14, 2016; Saskia Brechenmacher, Comparing Democratic Distress in the United States and Europe, Carnegie Endowment.org, June 21, 2018.

[25] Christine Lagarde, The Role of Business in Supporting a more Inclusive Global Economy, Conference on Inclusive Capitalism, New York, International Monetary Fund, October 10, 2016; A Broken Social Elevator? How to Promote Mobility, Organization for Economic Co-operation and Development, OECD Publishing, June 2018; The Framework for Policy Action on Inclusive Growth, Meeting of the OECD Council at Ministerial Level, Organization for Economic Co-operation and Development, Paris, May 30-31, 2018. Also see: A perfectly timed book on populism: John Judis has written a powerful account of the forces shaking Europe and America, The Economist, December 3, 2016. See, John Judis, The Populist Explosion, 2016; Ronald Inglehart and Pippa Norris, Trump, Brexit, and the Rise of Populism: Economic Have-Nots and Cultural Backlash, Harvard Kennedy School of Government, HKS Faculty Research Working Paper Series, August 2016;  Jason Tashea, Access to justice gap? It’s the economy, ABA Journal, December 17, 2018; Nouriel Roubini, The Political Left and Right Are Being Upended by Globalization Politics, Huffington Post, August 23, 2016.

[26] Tom Monahan, Populism Unleashed: 5 Steps for Business Leaders to Shape a Healthy Society and Boost Performance, CEB Global, November 9, 2016; J. David Hulchanski and Richard Maaranen, Neighbourhood Socio-Economic Polarization & Segregation in Toronto: Trends and Processes since 1970, paper presented at ‘Urban Poverty and Segregation in a Globalized World’ international conference at Delft University, Netherlands, September 19-20, 2018; Jason Tashea, Access to justice gap? It’s the economy, ABA Journal, December 17, 2018; The American Middle Class is Losing Ground: no longer the majority and falling behind financially, Pew Research Center, December 9, 2015; Klaus Schwab, Five Leadership priorities for 2017, World Economic Forum, January 2, 2017.  Also see, Annie Lowrey, 2016: A Year Defined by America’s Diverging Economies, The Atlantic, December 30, 2016; Ronald Inglehart and Pippa Norris, Trump, Brexit, and the Rise of Populism: Economic Have-Nots and Cultural Backlash, Harvard Kennedy School of Government, HKS Faculty Research Working Paper Series, August 2016; Claire Cain Miller, The Relentlessness of Modern Parenting: raising children has become significantly more time-consuming and expensive, amid a sense that opportunity has grown more elusive, New York Times, December 25, 2018.

[27] Dambisa Moyo, Why the survival of democracy depends on a strong middle-class, Globe and Mail, April 20, 2018 (Canada). Also see, Thomas Walkom, Why, after years of ignoring tax havens, are governments paying attention?, Toronto Star, November 8, 2017; Viola Tanto, The International Company and Tax Avoidance, European Journal of Multidisciplinary Studies, Vol. 1, No. 6, Sep-Dec 2016 (PHD Candidate in Tax Law, Business and Private Law Department, European University of Tirana); Paige Szmodis, Paradise Papers reveal unethical tax avoidance by tech companies, The Ursinus Grizzly, November 13, 2017; Paul Gillespie, Tax avoidance by multinationals contributes to inequality and is in political firing line, Irish Times, September 3, 2016; Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019.

[28] Anup Shah, Tax Avoidance and Tax Havens: Undermining Democracy, Global Issues.org, January 7, 2013.

[29] See for example, Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019.

[30] Taxing the Rich: Be it resolved, tax the rich (more) …, Munk Debates.com, May 30, 2013.

[31] Wayne Swan, Tax Avoidance impoverishes us all. Fighting it requires challenging the powerful, Guardian, January 11, 2016.

[32] Editorial, Why the Economy Needs Tax Reform, New York Times, December 29, 2012. Also see, Joseph Stiglitz, Inequality is Holding Back the Recovery, New York Times, January 19, 2013.

[33] Economic Growth: John R. Allan, David Gordon, Kyle Hanniman and Andre Juneau (editors), Canada: The State of the Federation 2015 – Canadian Federalism and Infrastructure, McGill-Queen’s University Press, 2018; Josh Bivens, The potential macroeconomic benefits from increasing infrastructure investment, Economic Policy Institute, July 18, 2017; CBO: Federal Investment is Good for Long-Term Growth – If It’s Paid For, Committee for a Responsible Federal Budget, August 22, 2016; Harry Stein, Budgeting for Public Investments and Economic Growth, Center for American Progress, September 14, 2016; William Berkson, Activist Government Investment, Evonomics, July 25, 2016; William Berkson, Government Investment and ‘Opportunity for All’, Washington Monthly, June 24, 2016; Vinod Thomas, Will more infrastructure spending increase US growth?, Brookings, December 13, 2016; Editorial, Why the Economy Needs Tax Reform, New York Times, December 29, 2012; Nathaniel Popper and Guilbert Gates, Rebuilding Our Infrastructure, New York Times, November 14, 2016; Joseph Stiglitz, Inequality is Holding Back the Recovery, New York Times, January 19, 2013.

[34] For example, see: Charles Lammam and Hugh MacIntyre, Myths of Infrastructure Spending in Canada, Fraser Institute, March 2017. [note: The Fraser Institute has been described as politically conservative and libertarian promoting rightwing ideology funded by corporate interests and billionaires  – Fraser Institute, Source Watch.org; Fraser Institute, Media Bias / Fact Check.com;  7 Disturbing Facts About the Fraser Institute, North 99.org, February 15, 2018; Daniel Tencer, Koch Brothers, Tea Party Billionaires, Donated To Right-Wing Fraser Institute, Reports Show, Huffington Post, April 26, 2012 (updated March 21, 2014).].

[35] Taxing the Rich: Be it resolved, tax the rich (more) …, Munk Debates.com, May 30, 2013.

[36] Marina Krakovsky, Does Lowering the Corporate Tax Rate Spur Economic Growth, Kellogg Insight, March 5, 2018. See, Nir Jaimovich and Sergio Rebelo, Non-linear Effects of Taxation on Growth, Journal of Political Economy, Vol. 125, Issue 1, February 2017; Igor Derysh, Trump’s own economists now agree: GOP tax cuts are failing to spark growth, Salon, March 21, 2019; Tyler Fisher, How past income tax rate cuts on the wealthy affected the economy, Politico, September 27, 2017; Jim Tankersley, Tax Havens Blunt Impact of Corporate Tax Cut, Economists Say, New York Times, June 10, 2018.

[37] Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019.

[38] Vinod Thomas, Will more infrastructure spending increase US growth?, Brookings, December 13, 2016.

[39] Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019; Natasha Bach, George Soros and Hundreds of Other Millionaires Are Asking Congress to Raise Their Taxes, Fortune, November 13, 2017; Amanda Holpuch, Forty millionaires ask New York to raise taxes on wealthy in ‘1% plan for fairness’, Guardian, March 21, 2016; Robert Frank, Millionaires Support Warren Buffett’s Tax on the Rich, Wall Street Journal, October 27, 2011; Maya Oppenheim, Bill Gates says he and other rich people should pay ‘significantly higher’ taxes, Independent, February 19, 2018; Emmie Martin, Bill Gates has paid over $10 billion in taxes – here’s why he says he should pay more, CNBC.com, February 21, 2018.

[40] Leigh Thomas, Tax the Rich? Poll of 21 Wealthy Countries Finds Broad Support for Higher Taxes on High Earners: Canadians are more likely than average to support a tax hike on the rich, Huffington Post, March 19, 2019; People Want Higher Taxes on Rich, Better Welfare: 21-Country OECD Survey, New York Times, March 19, 2019; Tax the rich and give us more services, Canadians say in OECD survey, CBC, March 19, 2019; Risks that Matter: Main Findings from the 2018 OECD Risks that Matter Survey, OECD, 2019; Taxes for the Common Good: A Public Justice Primer on Taxation, Citizens for Public Justice (cpj.ca), May 2015; Jennifer De Pinto, Fred Backus, Kabir Khanna and Anthony Salvanto, Most back tax cut for middle class, tax increase on wealthy and corporations, CBS News, November 1, 2017; Julia Manchester, Poll: Most back tax increase for wealthy, corporations, The Hill, November 1, 2017.

[41] Tax the rich and give us more services, Canadians say in OECD survey, CBC, March 19, 2019.

[42] Bill Moyers, How America became a 1% society, Guardian, September 12, 2016. Also see, Andrea Seabrook, American’s anxiety around the economy grows, Market Place.org, June 27, 2016; Michael Badad, Half of Canadians say they’re struggling to meet daily expenses: OECD, Globe and Mail, March 20, 2019.

[43] Paying Taxes: Why it Matters – Why Do Tax Rates and Tax Administration Matter?, Doing Business.org (World Bank), 2018.

[44] Taxes for the Common Good: A Public Justice Primer on Taxation, Citizens for Public Justice (cpj.ca), May 2015.

[45] Paying Taxes: Why it Matters – Why Do Tax Rates and Tax Administration Matter?, Doing Business.org (World Bank), 2018.

[46] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016.

[47] Taxes for the Common Good: A Public Justice Primer on Taxation, Citizens for Public Justice (cpj.ca), May 2015.

[48] Larry Elliott, This is about saving capitalism: the Dutch historian who savaged Davos elite, Guardian, February 1, 2019.

[49] Mariana Mazzucato, Capitalism’s greatest weakness? It confuses price with value, World Economic Forum, Mary 24, 2018. Also see, Mariana Mazzucato, The Value of Everything: Making and Taking in the Global Economy, Allen Lane, 2018.

[50] Dermot Egan, Does a company’s responsibility to society start with paying its taxes?, Guardian, September 9, 2011.

[51] Josh Hoxie, Commentary: Apple Avoided $40 Billion in Taxes. Now it Wants a Gold Star?, Fortune (timeinc.net), January 19, 2018.

[52] Dermot Egan, Does a company’s responsibility to society start with paying its taxes?, Guardian, September 9, 2011.

[53] ICGN Viewpoint, Corporate Tax Policy, International Corporate Governance Network, June 2016.

[54] Company stakeholders: A stakeholder is a party that has an interest in a company, and can either affect or be affected by the business. The primary stakeholders in a typical corporation are its investors, employees and customers. However, the modern theory of the idea goes beyond this original notion to include additional stakeholders such as a community, government or trade association. [Investopedia.com and Wikipedia]

Primary Stakeholders – usually internal stakeholders, are those that engage in economic transactions with the business. (For example stockholders, customers, suppliers, creditors, and employees).

Secondary Stakeholders – usually external stakeholders, are those who – although they do not engage in direct economic exchange with the business – are affected by or can affect its actions (for example the general public, government, communities, activist groups, business support groups, and the media).

[55] See, Eric Sigurdson, Overcoming the Forces of ‘Short-termism’ – corporate governance, principled leadership, and long-term sustainable value creation, Sigurdson Post, February 19, 2018.

[56] Brad Nikolic, No Moral Compass, No Leadership Compass at all, LinkedIn, March 27, 2018:

“If businesses are unashamedly about maximising profits and being as successful as possible, then this desire can easily generate the ‘achievement-at-all-cost’ and ‘take every shortcut’ mentality. …

It is this mentality, when combined with highly incentivised remuneration, easily gives rise to walking the ‘ethical fine-line’. This in turn, potentially leads to a culture of greed, which places individuals into the zone of unethical territory. Put simply, if this mentality is combined with an amoral mindset then unacceptable leadership is almost guaranteed.”

[57] See generally, See, Eric Sigurdson, Overcoming the Forces of ‘Short-termism’ – corporate governance, principled leadership, and long-term sustainable value creation, Sigurdson Post, February 19, 2018.

[58] Andrew Ross Sorkin, BlackRock’s Message: Contribute to Society, or Risk Losing our Support, New York Times, January 15, 2018; Laurence Fink (Chairman and CEO, BlackRock), Larry Fink’s Annual Letter to CEOS: A Sense of Purpose, BlackRock.com, January 2018; Ben Marlow and Tim Wallace, ‘Larry’s Letter’ drives charge for reimagining of global capitalism, The Telegraph.co.uk, January 28, 2018; Andrew Ross Sorkin, Larry Fink Calls on Businesses to Lead, Not Just Live, With Purpose, New York Times, January 17, 2019. Also see, Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019.

[59] Lynn Stout (professor, corporate and business law, Cornell Law School), Corporations Don’t Have to Maximize Profits, New York Times, April 16, 2015. Also see, Steven Pearlstein, Businesses’ focus on maximizing shareholder value has numerous costs, Washington Post, September 6, 2013.

[60] Joseph L. Bower and Lynn S. Paine, The Error at the Heart of Corporate Leadership: most CEOs and Boards believe their main duty is to maximize shareholder value. It’s not, Harvard Business Review, May-June 2017.

[61] Taxes for the Common Good: A Public Justice Primer on Taxation, Citizens for Public Justice (cpj.ca), May 2015.

[62] Alex Hemelfarb and Jordan Himelfarb, Canada’s dangerously distorted tax conversation, Toronto Star, October 6, 2013.

[63] Alex Hemelfarb and Jordan Himelfarb, Canada’s dangerously distorted tax conversation, Toronto Star, October 6, 2013.

[64] Angel Burria (OECD Secretary-General), 2019 Edelman Trust Barometer, OECD.org, January 30, 2019. Also see, 2019 Edelman Trust Barometer: Global Report, Edelman.com, 2019.

[65] 2019 Edelman Trust Barometer: Global Report, Edelman.com, 2019; Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019.

[66] Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019.

[67] Megan Cerullo, Some of America’s biggest companies paid little to no federal income tax in 2018, CBS News, March 4, 2019.

[68] Kristin Myers, Amazon will pay $0 in taxes on $11,200,000,000 in profit for 2018, Yahoo Finance, February 16, 2019. Also see, Laura Stampler, Amazon will pay a Whopping $0 in Federal Taxes on $11.2 Billion Profits, Fortune, February 19, 2019.

[69] Max Lawson, etal, Public Good or Private Wealth?, Oxfam.org, January 2019; Vinod Thomas, Will more infrastructure spending increase US growth?, Brookings, December 13, 2016; IMF Policy Paper: Fiscal Policy and Long-Term Growth, International Monetary Fund, June 2015; Fiscal Policy and Growth: Why, What, and How?, OECD.org, 2015; Jean-Marc Fournier, The Positive Effect of Public Investment on Potential Growth, OECD, Economics Department Working Papers No. 1347, November 22, 2016.

[70] Meeting of the OECD Council at Ministerial Level, Opportunities for All: A Framework for Policy Action on Inclusive Growth, OECD.org, May 30-31, 2018.

[71] Lisa Kimmel, Canada’s unprecedented trust gap: Who will build the bridge for a country divided?, Globe and Mail, February 14, 2019. Also see, 2019 Edelman Trust Barometer: Global Report, Edelman.com.

[72] Meeting of the OECD Council at Ministerial Level, Opportunities for All: A Framework for Policy Action on Inclusive Growth, OECD.org, May 30-31, 2018.

[73] Wayne Swan, Tax avoidance impoverishes us all. Fighting it requires challenging the powerful, Guardian, January 11, 2016.

[74] Alex Himelfarb and Jordan Himelfarb (editors), Tax is Not A Four-Letter Word: A Different Take on Taxes in Canada, Wilfred Laurier University Press, 2013.

[75] Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[76] Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[77] Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[78] Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[79] Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[80] Michael Goldfien and Michael Woolslayer, Trump, the Brexit, and the Fraying of the Western Diplomatic Consensus, Huffington Post, June 21, 2017 (updated from June 20, 2016):

“For 70 years, the United States and the United Kingdom have been at the core of the most successful transnational political and ideological bloc since the Roman Empire. Even as Britain’s hard power has waned, London’s role as a liberal force in European politics and a cultural heavyweight has allowed it to be perhaps America’s greatest ally in upholding the current rule- and trade-based international system. That system is fundamentally based on the proposition that international engagement, rather than isolation, is the best path to peace and prosperity. That so many in the United States and the United Kingdom question this proposition, as evidenced by the strong support for Donald Trump and a possible Brexit, is a worrisome sign for the international order indeed.”

[81] Ariana Berengaut and Edward Fishman, Why Americans Should Fight Donald Trump’s Isolationism, Time, June 15, 2017;

[82] Ian Bremmer, Every Nation for Itself: Winners and Losers in a G-Zero World, Penguin Group, 2012.

[83] Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018; Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, First Anchor Books Edition, 2016, 2017 (preface); Tim Dunlop, Three things must change for a healthier democracy, ABC.net.au, October 17, 2014. Also see, for example: Charles Kaiser, Dark Money review: Nazi oil, the Koch brothers and a rightwing revolution, The Guardian, January 17, 2016; Daniel Ben-Ami, Book Review: ‘Dark Money’, by Jane Mayer, Financial Times, March 11, 2016;Donald Gutstein, Harperism: How Stephen Harper and his think tank colleagues have transformed Canada, James Lorimer & Company Publishers, 2014; Daphne Bramham, Lessons for Canada from how the Koch brothers hijacked democracy, Vancouver Sun, September 25, 2016;Alan Ehrenhalt, ‘Dark Money’, by Jane Mayer, New York Times, January 19, 2016:

“Charles and David Koch, the enormously rich proprietors of an oil company based in Kansas, decided that they would spend huge amounts of money to elect conservatives at all levels of American government. David Koch ran for vice president on the Libertarian ticket in 1980, but when the campaign was over, he resolved never to seek public office again. That wouldn’t be necessary, he and his brother concluded; they could invest in the campaigns of others, and essentially buy their way to political power.

Thirty years later, the midterm elections of 2010 ushered in the political system that the Kochs had spent so many years plotting to bring about. After the voting that year, Republicans dominated state legislatures; they controlled a clear majority of the governorships; they had taken one chamber of Congress and were on their way to winning the other. Perhaps most important, a good many of the Republicans who had won these offices were not middle-of-the-road pragmatists. They were antigovernment libertarians of the Kochs’ own political stripe. The brothers had spent or raised hundreds of millions of dollars to create majorities in their image. They had succeeded. And not merely at the polls: They had helped to finance and organize an interlocking network of think tanks, academic programs and news media outlets that far exceeded anything the liberal opposition could put together.

It is this conservative ascendancy that Jane Mayer chronicles in “Dark Money.” The book is written in straightforward and largely unemotional prose, but it reads as if conceived in quiet anger. Mayer believes that the Koch brothers and a small number of allied plutocrats have essentially hijacked American democracy, using their money not just to compete with their political adversaries, but to drown them out. …

What were all these organizations and donors promoting, other than the election of Republican candidates to office? Free-market orthodoxy, to start with. “Market principles have changed my life,” Charles Koch declared in the 1990s, “and guide everything I do.” That seems as true in 2016 as it was when he said it. Closely related to free-market faith is the hatred of regulation, federal, state or local. “We should not cave in the moment a regulator sets foot on our doorstep,” Charles once wrote. “Do not cooperate voluntarily; instead, resist wherever and to whatever extent you legally can.”

This ideology helps to explain one of the most important Koch crusades of recent years: the fight to prevent action against climate change. The Koch-sponsored advocacy group Americans for Prosperity has been at the forefront of climate-change opposition over the past decade. When the Republicans took over the House of Representatives in 2011, Americans for Prosperity lobbied lawmakers to support a “no climate tax” pledge, and by the time Congress convened that year, 156 House and Senate members had signed on.”

Tim Roemer and Zach Wamp, John McCain’s warning about dark money is real. Stop campaign finance corruption, USA Today, May 8, 2018:

“According to Sen. John McCain, R-Ariz., a secretive, corrupting campaign finance system is at the root of political dysfunction dividing Americans across the country — and he says Congress better fix it. He candidly writes in his forthcoming memoir, The Restless Wave, that non-profit social welfare organizations — the 501(c)(4)s that hide their donors and fight to keep them secret — “are often financed by one or two of several billionaires” who yield enormous influence.”

[84] Matthew Yglesias, American democracy is doomed, Vox, October 8, 2015; David Moss, Fixing What’s Wrong with U.S. Politics, Harvard Business Review, March 2012.

[85] As noted by the New York Times, “if you think globalization, immigration, trade and demographic change have contributed to displacement and political anger, wait until robots take away millions and millions of jobs, including those requiring the use of a well-trained brain” [Anand Giridharadas, When Technology Sets off a Populist Revolt, New York Times, August 29, 2016].  Until recently, technology has been an often overlooked—but significant—factor, and going forward you can expect technology to change the economy even more than globalization [Simon Veazey, The Impact of Technology’s Invisible Hand, Epoch Times, October 28, 2016; Hadi Partovi, A trillion-dollar opportunity for America, LinkedIn, January 9, 2017]. Federal Reserve Chair Janet Yellen has noted that globalization and technology has “reinforced the shift away from lower-skilled jobs that require less education, to higher-skilled jobs that require college and advanced degrees,” and that “the jobs that globalization creates” – serving a global economy of billions of people – “are more likely to be filled by those who have secured the advantage of higher education” [Akin Oyedele, Trump could be looking at the job market all wrong, Business Insider, January 8, 2017].

[86] The economic inequality perspective — emphasizes the consequences for electoral behavior arising from profound changes transforming the workforce and society in post-industrial economies. There is overwhelming evidence of powerful trends toward greater income and wealth inequality in the West, based on the rise of the knowledge economy, technological automation, and the collapse of manufacturing industry, global flows of labor, goods, peoples, and capital (especially the inflow of migrants and refugees), the erosion of organized labor, shrinking welfare safety-nets, and neo-liberal austerity policies.  According to this view, rising economic insecurity and social deprivation among the left-behinds has fueled popular resentment of the political classes. This situation is believed to have made the less secure strata of society – low-waged unskilled workers, the long-term unemployed, households dependent on shrinking social benefits, residents of public housing, single-parent families, and poorer white populations living in inner-city areas with concentrations of immigrants– susceptible to the anti-establishment, nativist, and xenophobic scare-mongering exploited of populist movements, parties, and leaders, blaming ‘Them’ for stripping prosperity, job opportunities, and public services from ‘Us’. [Ronald Inglehart and Pippa Norris, Trump, Brexit, and the Rise of Populism: Economic Have-Nots and Cultural Backlash, Harvard Kennedy School of Government, HKS Faculty Research Working Paper Series, August 2016]. Also see, Suresh Naidu, Eric Posner, and Glen Weyl, More and more companies have monopoly power over workers’ wages. That’s killing the economy, Vox, April 6, 2018.

[87] Rana Dasgupta, The demise of the nation state, The Guardian, April 5, 2018. Also see, Hilary Matfess and Michael Miklaucic (editors), Beyond Convergence: World Without Order, Center for Complex Operations at National Defense University, 2016 (see, Chapter 2, Nils Gilman, The Twin Insurgencies: Plutocrats and Criminals Challenge the Westphalian State, etc).

[88] For example, see: Daisuke Wakabayashi and Brian Chen, Apple, Capitalizing on New Tax Law, Plans to Bring Billions in Cash Back to U.S., New York Times, January 17, 2018 (94% of Apple’s total cash of $269 billion held outside of the U.S., its home country); Gabriel Zucman, How Corporations and the Wealthy Avoid Taxes (and How to Stop Them), New York Times, November 10, 2017.

[89] Robert Cribb and Marco Chown Oved, Panama Papers revelations have already delivered results: laying bare the secretive world of offshore finance, reports detailed the secretive flow of billions of dollars in a parallel offshore economy, The Toronto Star, December 11, 2016; FT View, Stranger than paradise: the truth about taxes, Financial Times, November 10, 2017; Juliette Garside, Paradise Papers leak reveals secrets of the world elite’s hidden wealth: files from offshore law firm show financial dealings of the Queen, big multinationals and members of Donald Trump’s cabinet, The Guardian, November 5, 2017.

[90] Thomas Piketty, Save capitalism from the capitalists by taxing wealth: rising levels of inequality need to be addressed on a global scale, Financial Times, March 28, 2014.

[91] Paradise Papers: the hidden costs of tax dodging, Oxfam International (Oxfam.org); Robert Cribb and Marco Chown Oved, Panama Papers revelations have already delivered results: laying bare the secretive world of offshore finance, reports detailed the secretive flow of billions of dollars in a parallel offshore economy, The Toronto Star, December 11, 2016; FT View, Stranger than paradise: the truth about taxes, Financial Times, November 10, 2017; Juliette Garside, Paradise Papers leak reveals secrets of the world elite’s hidden wealth: files from offshore law firm show financial dealings of the Queen, big multinationals and members of Donald Trump’s cabinet, The Guardian, November 5, 2017.

[92] Jeff Stein, Across the globe, taxes on corporations plummet, Washington Post, July 24, 2018; Overhaul tax for the 21^st century, The Economist, August 9, 2018; Alex Cobham and Petr Jansky, Global distribution of revenue loss from tax avoidance: Re-estimation and country results, WIDER Working Paper 2017/55, United Nations University World Institute for Development Economics Research (wider.unu.edu), March 2017; Ernesto Crivelli, Ruud De Mooij and Michael Keen, IMF Working Paper: Base Erosion, Profit Shifting, and Developing Countries, WP15/118, International Monetary Fund, May 2015; Jane Gravelle, Tax Havens: International Tax Avoidance and Evasion, Washington, DC: Congressional Research Service, 2015; Sophie Perryer, Top 5 tax scandals, World Finance.com, October 16, 2018; Jane Gravelle, Tax Havens: International Tax Avoidance and Evasion, National Tax Journal, Vol. 62, 2009.

[93] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018.

[94] Chris Nicholas, Twelve steps to stop tax avoidance, New Statesman, September 3, 2013.

[95] Jeff Stein, Across the globe, taxes on corporations plummet, Washington Post, July 24, 2018. Also see, Thomas Torslov, Ludvig Wier, and Gabriel Zucman, The Missing Profits of Nations, National Bureau of Economic Research, NBER Working Paper 24701, June 2018 (revised August 2018).

[96] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018.

[97] Tax reforms accelerating with push to lower corporate tax rates, OECD.org, May 9, 2018. Also see, Tax Policy Reforms 2018: OECD and Selected Partner Economies, OECD Publishing, 2018;

[98] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018; Thomas Torslov, Ludvig Wier, and Gabriel Zucman, The Missing Profits of Nations, National Bureau of Economic Research, NBER Working Paper 24701, June 2018 (revised August 2018).

[99] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018.

[100] Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017.

[101] Esteban Ortiz-Ospina and Max Roser, Taxation, Our World In Data.org, 2019.

[102] Michael Hiltzik, American is falling out of love with billionaires, and it’s about time, Los Angeles Times, February 1, 2019.

[103] Eliza Relman, ‘2020 class warfare?’: Alexandria Ocasio-Cortez and the left face off against billionaires in a fight to tax the rich, Business Insider, February 2, 2019; Taxes for the Common Good: A Public Justice Primer on Taxation, Citizens for Public Justice (cpj.ca), May 2015; Leigh Thomas, Tax the Rich? Poll of 21 Wealthy Countries Finds Broad Support for Higher Taxes on High Earners: Canadians are more likely than average to support a tax hike on the rich, Huffington Post, March 19, 2019; People Want Higher Taxes on Rich, Better Welfare: 21-Country OECD Survey, New York Times, March 19, 2019; Tax the rich and give us more services, Canadians say in OECD survey, CBC, March 19, 2019. Risks that Matter: Main Findings from the 2018 OECD Risks that Matter Survey, OECD, 2019; Jennifer De Pinto, Fred Backus, Kabir Khanna and Anthony Salvanto, Most back tax cut for middle class, tax increase on wealthy and corporations, CBS News, November 1, 2017; Julia Manchester, Poll: Most back tax increase for wealthy, corporations, The Hill, November 1, 2017. Also see, Frank Newport, Americans Still Say Upper-Income Pay Too Little in Taxes, Gallup.com, April 15, 2016; Matthew Sheffield, Poll: A majority of Americans support raising the top tax rate to 70 percent, The Hill, January 15, 2019; Matthew Yglesias, Alexandria Ocasio-Cortez is floating a 70 percent top tax rate – here’s the research that backs her up: some studies indicate she’s aiming to low, Vox, January 7, 2019; Patricia Cohen and Maggie Astor, For Democrats Aiming Taxes at the Superrich, ‘the Moment Belongs to the Bold’, New York Times, February 8, 2019; Ben White, Soak the Rich? Americans say go for it: surveys are showing overwhelming support for raising taxes on top earners, Politico, February 4, 2019; Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019.

[104] Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019.

[105] Matthew Yglesias, Alexandria Ocasio-Cortez is floating a 70 percent top tax rate – here’s the research that backs her up: some studies indicate she’s aiming to low, Vox, January 7, 2019.

[106] Matthew Yglesias, Alexandria Ocasio-Cortez is floating a 70 percent top tax rate – here’s the research that backs her up: some studies indicate she’s aiming to low, Vox, January 7, 2019. Also see, Alvin Chang, 100 years of tax brackets, in one chart, Vox, April 16, 2018.

[107] Joe Ciolli, Billionaires who hate Alexandria Ocasio-Cortez’s 70% tax on the superrich are adamant it will hurt the economy – history suggests otherwise, Business Insider, February 7, 2019.

[108] Peter Diamond and Emmanuel Saez, The Case for a Progressive Tax: From Basic Research to Policy Recommendations, CES IFO Working Paper No. 3548, August 2011. Contra, see Alejandro Badel, Mark Huggett, and Wenlan Luo, Taxing Top Earners: A Human Capital Perspective, Draft July 9, 2018 (note: arrived at 49% as the optimal top tax rate).

[109] Matthew Yglesias, Alexandria Ocasio-Cortez is floating a 70 percent top tax rate – here’s the research that backs her up: some studies indicate she’s aiming to low, Vox, January 7, 2019; Peter Diamond and Emmanuel Saez, The Case for a Progressive Tax: From Basic Research to Policy Recommendations, CES IFO Working Paper No. 3548, August 2011; Joe Ciolli, Billionaires who hate Alexandria Ocasio-Cortez’s 70% tax on the superrich are adamant it will hurt the economy – history suggests otherwise, Business Insider, February 7, 2019.

[110] Joe Ciolli, Billionaires who hate Alexandria Ocasio-Cortez’s 70% tax on the superrich are adamant it will hurt the economy – history suggests otherwise, Business Insider, February 7, 2019; Alejandro Badel, Mark Huggett, and Wenlan Luo, Taxing Top Earners: A Human Capital Perspective, Draft July 9, 2018 (note: arrived at 49% as the optimal top tax rate).

[111] Joe Ciolli, Billionaires who hate Alexandria Ocasio-Cortez’s 70% tax on the superrich are adamant it will hurt the economy – history suggests otherwise, Business Insider, February 7, 2019.

[112] Ian McGugan, Taxing the rich and finding the sweet spot in the tax debate, Globe and Mail, March 15, 2019.

[113] Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019 (referencing the Tax Foundation).

[114] Ian McGugan, Taxing the rich and finding the sweet spot in the tax debate, Globe and Mail, March 15, 2019.

[115] Ten Reasons to Defend the Corporation Tax: how corporate income tax protects democracy and curbs inequality, Tax Justice Network (taxjustice.net), 2015;

[116] Laura Stampler, Amazon will pay a Whopping $0 in Federal Taxes on $11.2 Billion Profits, Fortune, February 19, 2019.

[117] David Pegg, Paradise Papers: Davos panel calls for global corporate tax reform, Guardian, January 25, 2018.

[118] Steve Pearlstein, Businesses’ focus on maximizing shareholder value has numerous costs, Washington Post, September 6, 2013.

[119] Joseph E. Stiglitz, How Can We Tax Footloose Multinationals?, Project Syndicate, February 13, 2019.

[120] Brian Peccarelli, As some major economies cut their corporate tax rates – what will happen next?, World Economic Forum, January 19, 2018; Jamie Smyth, Australia joins global push to cut corporate tax rates, Financial Times, February 8, 2018; Shane Wright, Australia has world’s third highest corporate tax rate, Sydney Morning Herald, January 15, 2019; Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016.

[121] Jessica Irvine, What economists really think about cutting corporate tax, Sydney Morning Herald, February 23, 2018.

[122] Joseph E. Stiglitz, How Can We Tax Footloose Multinationals?, Project Syndicate, February 13, 2019.

[123] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018.

[124] Lana Payne, Say no to more corporate cuts, Canada, Telegram, August 4, 2018.

[125] Martin Lukacs, Revealed: oil giants pay billions less tax in Canada than abroad, Guardian, October 26, 2017.

[126] Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017.

[127] Megan Cerullo, Millionaire (and billionaire) taxes: An idea whose time has come?, CBS News, February 8, 2019.

[128] Marina Krakovsky, Does Lowering the Corporate Tax Rate Spur Economic Growth, Kellogg Insight, March 5, 2018. See, Nir Jaimovich and Sergio Rebelo, Non-linear Effects of Taxation on Growth, Journal of Political Economy, Vol. 125, Issue 1, February 2017; Igor Derysh, Trump’s own economists now agree: GOP tax cuts are failing to spark growth, Salon, March 21, 2019; Tyler Fisher, How past income tax rate cuts on the wealthy affected the economy, Politico, September 27, 2017; Jim Tankersley, Tax Havens Blunt Impact of Corporate Tax Cut, Economists Say, New York Times, June 10, 2018.

[129]  Thomas Torslov, Ludvig Wier, and Gabriel Zucman, The Missing Profits of Nations, National Bureau of Economic Research, NBER Working Paper 24701, June 2018 (revised August 2018). Also see, Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019; Alex Cobham and Petr Jansky, Global distribution of revenue loss from tax avoidance: Re-estimation and country results, WIDER Working Paper 2017/55, United Nations University World Institute for Development Economics Research (wider.unu.edu), March 2017; Ernesto Crivelli, Ruud De Mooij and Michael Keen, IMF Working Paper: Base Erosion, Profit Shifting, and Developing Countries, WP15/118, International Monetary Fund, May 2015; Jane Gravelle, Tax Havens: International Tax Avoidance and Evasion, Washington, DC: Congressional Research Service, 2015; Sophie Perryer, Top 5 tax scandals, World Finance.com, October 16, 2018; Jane Gravelle, Tax Havens: International Tax Avoidance and Evasion, National Tax Journal, Vol. 62, 2009; Overhaul tax for the 21^st century, The Economist, August 9, 2018; Wayne Swan, Tax avoidance impoverishes us all. Fighting it requires challenging the powerful, Guardian, January 11, 2016; OECD Work on Taxation: 2018-2019, The Organisation for Economic Co-operation and Development (oecd.org), 2018.

[130] Jim Tankersley, Tax Havens Blunt Impact of Corporate Tax Cut, Economists Say, New York Times, June 10, 2018. Also see, Thomas Torslov, Ludvig Wier, and Gabriel Zucman, The Missing Profits of Nations, National Bureau of Economic Research, NBER Working Paper 24701, June 2018 (revised August 2018); Jeff Stein, Across the globe, taxes on corporations plummet, Washington Post, July 24, 2018.

[131] Thomas Torslov, Ludvig Wier, and Gabriel Zucman, The Missing Profits of Nations, National Bureau of Economic Research, NBER Working Paper 24701, June 2018 (revised August 2018).

[132] Andrew Jackson, Corporate-tax cuts are no solution to Canada’s competiveness problem, Globe and Mail, October 29, 2018.

[133] Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017. Also see, Fabrizio Carmignani, There isn’t solid research or theory to support cutting corporate taxes to boost wages, Conversation, February 22, 2018 (“The argument that cutting the Australian company tax rate will lead to higher investment and wages, more employment and faster GDP growth does not have solid empirical or theoretical backing.”); Andrew Jackson, Corporate-tax cuts are no solution to Canada’s competiveness problem, Globe and Mail, October 29, 2018.

[134] Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017.

[135] Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017.

[136] William Watson, Canada’s ‘chummy’ capitalism isn’t much better than Third World crony capitalism, Financial Post, September 14, 2018; Jonathan Macey, The Rise of Crony Capitalism, Hoover Institution, February 11, 2016; Richard Rahn, Crony capitalism against the real thing: Collusion between government and business corrupts the free market, Washington Times, July 24, 2017; Tamasin Cave and Andy Rowell, A Quiet Word: Lobbying, Crony Capitalism and Broken Politics in Britain, The Bodley Head, 2014; Alina Mungiu-Pippidi and Roberto M. B. Kukutschka, Can a civilization know its own institutional decline? A tale of indicators, In H. Anheier, M. Haber and M. Kayser (editors), Governance Indicators: Approaches, Progress, Promise, Oxford University Press, 2018 (note: originally: Alina Mungiu-Pippidi and Roberto M. B. Kukutschka, Crony Capitalism in the European Union: Subjective or Objective?, ERCAS Working Paper No. 51, European Reseach Centre for Anti-Corruption and State-Building, October 2017); Jack Waterford, Cronyism is a weeping sore in Australian government, Sydney Morning Herald, September 15, 2018; Michael McKinley, Crony capitalism and corruption in our midst, Sydney Morning Herald, September 4, 2018.

[137] See generally, Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019; Jim Tankersley, Tax Havens Blunt Impact of Corporate Tax Cut, Economists Say, New York Times, June 10, 2018.

[138] The Global Risks Report 2018 (14th edition), World Economic Forum, 2019; Sean Fleming, The top 10 risks to the global economy, according to the Economist Intelligence Unit, World Economic Forum, March 5, 2019.

[139] William Horobin, France’s message for capitalism is quite simple: Adapt or die, BNN Bloomberg, March 17, 2019. Also see, Paul Collier, The Future of Capitalism: Facing the New Anxieties, HarperCollins, 2018.

[140] Carolina Hillenbrand, Kevin Guy Money, Chris Brooks, and Nicole Tovstiga, Corporate Tax: What Do Stakeholders Expect?, Journal of Business Ethics, 2017.

[141] Capitalism, Investopedia.com.  Also see, William Watson, Canada’s ‘chummy’ capitalism isn’t much better than Third World crony capitalism, Financial Post, September 14, 2018; Jonathan Macey, The Rise of Crony Capitalism, Hoover Institution, February 11, 2016; Richard Rahn, Crony capitalism against the real thing: Collusion between government and business corrupts the free market, Washington Times, July 24, 2017; Tamasin Cave and Andy Rowell, A Quiet Word: Lobbying, Crony Capitalism and Broken Politics in Britain, The Bodley Head, 2014; Alina Mungiu-Pippidi and Roberto M. B. Kukutschka, Can a civilization know its own institutional decline? A tale of indicators, In H. Anheier, M. Haber and M. Kayser (editors), Governance Indicators: Approaches, Progress, Promise, Oxford University Press, 2018 (note: originally: Alina Mungiu-Pippidi and Roberto M. B. Kukutschka, Crony Capitalism in the European Union: Subjective or Objective?, ERCAS Working Paper No. 51, European Reseach Centre for Anti-Corruption and State-Building, October 2017); Jack Waterford, Cronyism is a weeping sore in Australian government, Sydney Morning Herald, September 15, 2018; Michael McKinley, Crony capitalism and corruption in our midst, Sydney Morning Herald, September 4, 2018.

[142] John Christensen and Richard Murphy, The Social Irresponsibility of Corporate Tax Avoidance: Taking CSR to the Bottom Line, 47 Development 37, 2004.

[143] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016; Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[144] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016; Harmful Tax Competition: An Emerging Global Issue, OECD, 1998; IMF Policy Paper: Spillovers in International Corporate Taxation, International Monetary Fund, May 9, 2014; Pat Sweet, OECD says corporate tax rates in ‘race to the average’, Accountancy Daily.co, September 5, 2018.

[145] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016; Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[146] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016; Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[147] Nassim Khadem, OECD pushes for a global minimum corporate tax rate by 2020, but is it wishful thinking?, ABC News (abc.net.au), February 10, 2019; Daniel Bunn, What Happens When Everyone is GILTI?, Tax Foundation.org, March 1, 2019; Leigh Thomas, OECD working on plans for minimum corporate tax, Reuters, January 29, 2019; US ‘backs French push for minimum global tax rate’ on corporations, The Local.fr, February 28, 2019; Digital Tax: OECD Update & Global Minimum Corporate Tax Rate Proposals, CFE’s Tax Top 5: Key Tax News of the Week, Tax Advisers Europe.org, October 22, 2018; Peter Dietsch, Establishing a minimum corporate tax rate globally would address some of the challenges posed by the current race to the bottom in tax competition, Policy Options (policyoptions.irpp.org), June 1, 2018; Rifat Azam, Minimum Global Effective Corporate Tax Rate as General Anti-Avoidance Rule, Columbia Journal of Tax Law, Vol. 8, No. 1, January 20, 2017.

[148] Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016; Harmful Tax Competition: An Emerging Global Issue, OECD, 1998.

[149] Borge Brende, As Wold Powers Fail to Work Together, Global Risks Grow More Dangerous, Time, January 16, 2019; The Global Risks Report 2019 (14th edition), World Economic Forum, 2019; The Global Risks Report 2018 (13th edition), World Economic Forum, 2018.

[150] Borge Brende, As Wold Powers Fail to Work Together, Global Risks Grow More Dangerous, Time, January 16, 2019; The Global Risks Report 2019 (14th edition), World Economic Forum, 2019; The Global Risks Report 2018 (13th edition), World Economic Forum, 2018.

[151] Steve Pearlstein, Businesses’ focus on maximizing shareholder value has numerous costs, Washington Post, September 6, 2013. Also see, Lynn Stout, The Shareholder Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public, Barrett-Hoehler Publishers, 2012.

[152] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[153] Chris MacDonald and Alexei Marcoux, editors, CSR (Corporate Social Responsibility), Concise Encyclopedia of Business Ethics (conciseencyclopedia.org).

[154] Also see, for example: Charles Riley, Unilever to Facebook and Google: Clean up ‘swamp’ or we’ll pull ads, CNN.com, February 12, 2018; Suzanne Vranica, Unilever Threatens to Reduce Ad Spending on Tech Platforms That Don’t Combat Divisive Content: CMO Keith Weed says the company will only invest in platforms ‘committed to creating a positive impact in society’, Wall Street Journal, February 11, 2018.

[155] Douglas Beal, Robert Eccles, Gerry Hansell, Rich Lesser Shalini Unnikrsihnan, Wendy Woods, David Young, Total Societal Impact: A New Lens for Strategy, The Boston Consulting Group, October 2017.

[156] See, Alexadra Richards, Prime Minister to stop private sector ‘pension abuse’ in the wake of Carillion collapse, Evening Standard, January 21, 2018; Theresa May, Boardroom excesses can no longer be tolerated. The economy has to work for all, The Guardian, January 20, 2018; Global Pension Ponzi – Carillion Collapse One of Many to Come, Zero Hedge.com, January 22, 2018; Attracta Mooney, US and Europe have world’s worst-funded corporate pension schemes, Financial Times, September 9, 2017; F. Kopun, Will 16,000 Sears Canada retirees see their pensions?: Sears Canada paid millions in dividends while its pension went underfunded. Now the former employees may end up paying the price, Toronto Star, Jan. 20, 2018.

[157] Andrew Ross Sorkin, BlackRock’s Message: Contribute to Society, or Risk Losing our Support, New York Times, January 15, 2018.

[158] Mark Kramer, The Backlash to Larry Fink’s Letter Shows How Far Business Has to Go on Social Responsibility, Harvard Business Review, January 31, 2019.

[159] David Horsager, Trust Edge, 2012; WEF Leadership (Trust and Performance Equation Project prepared in collaboration with PwC), The Evolution of Trust in Business: From Delivery to Values, World Economic Forum, January 2015. Also see, Amina Shahid and Dr. M. Azhar Shahid, Integrity and Trust: The Defining Principles of Great Workplaces, Journal of Management Research, Vol. 5 No. 4, October 1, 2013; Building a Corporate Reputation of Integrity, Ethics Resource Center (www.ethics.org/fellows), 2011.

[160] Larry Fink (Chairman and CEO at Blackrock), LinkedIn, January 2018.

[161] Meghan Morris, BlackRock chief Larry Fink tells CEOs to fix society’s problems in an increasingly divided world, Business Insider, January 17, 2019; Andrew Ross Sorkin, World’s Biggest Investor Tells C.E.O.s Purpose is the ‘Animating Force’ for Profits, New York Times, January 17, 2019.

[162] Larry Fink, Larry Fink’s 2019 Letter to CEOs: Purpose & Profit, BlackRock.com, 2019.

[163] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017; Supporting Corporate Social Responsibility initiatives, Canada.ca; OECD Guidelines for Multinational Enterprises (2011 edition), OECD, 2011; Reuven S. Avi-Yonah, Corporate Taxation and Corporate Social Responsibility, N.Y.U. Journal of Law & Bus., Vol. 11, No. 1, 2014; Reijo Knuutinen, Corporate Social Responsibility, Taxation and Aggressive Tax Planning, Nordic Tax Journal, 2014.

[164] John Christensen and Richard Murphy, The Social Irresponsibility of Corporate Tax Avoidance: Taking CSR to the Bottom Line, 47 Development 37, 2004; Thomas Scheiwiller and Susan Symons, Corporate responsibility and paying tax, OECD Observer, Dec. 2009 – January 2010.

[165] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[166] Dermot Egan, Does a company’s responsibility to society start with paying its taxes?, Guardian, September 9, 2011.

[167] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[168] Mark Kramer, The Backlash to Larry Fink’s Letter Shows How Far Business Has to Go on Social Responsibility, Harvard Business Review, January 31, 2019.

[169] Ian Davis, Business and Society: The biggest contract – building social issues into strategy, big business can recast the debate about its role, The Economist, May 26, 2005.

[170] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[171] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017; Jonathan Webb, Tax As The Next CSR Risk: The Subject No One is Talking About, Forbes, April 18, 2016; Reuven S. Avi-Yonah, Corporate Taxation and Corporate Social Responsibility, N.Y.U. Journal of Law & Bus., Vol. 11, No. 1, 2014; Andrew Winston, Corporate Citizenship Should Include Paying Taxes, Harvard Business Review, April 6, 2011;

[172] Tax Responsibility: The business case for making tax a corporate responsibility issue, Action Aid.org.uk, July 2011; Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[173] Tax Responsibility: The business case for making tax a corporate responsibility issue, Action Aid.org.uk, July 2011; Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019; Jonathan Webb, Tax As The Next CSR Risk: The Subject No One is Talking About, Forbes, April 18, 2016.

[174] Tax Responsibility: The business case for making tax a corporate responsibility issue, Action Aid.org.uk, July 2011; Eric Sigurdson, Making the Case for ‘Digital Taxation’: Into the Kingdom of Tech Giants – international tax avoidance and the modern digital economy, Sigurdson Post, January 21, 2019;

[175] Vanessa Houlder, Tax claims hit reputation as well as coffers, Financial Times, November 8, 2010.

[176] Tax Responsibility: The business case for making tax a corporate responsibility issue, Action Aid.org.uk, July 2011; Eric Sigurdson, Overcoming the Forces of ‘Short-termism’ – corporate governance, principled leadership, and long-term sustainable value creation, Sigurdson Post, February 19, 2018; Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017.

[177] Daron Narotzki, Corporate Social Responsibility and Taxation: A Chance to Develop the Theory, Western New England Law Review, Vol. 39, Issue 4, 2017. Also see, Simon Bowers and Rajeev Syal, MP on Google tax avoidance scheme: ‘I think that you do evil’, Guadian, May 16, 2013; Alexi Mostrous, Google attacked by MPs over ‘evil’ of tax avoidance, The Times, May 17, 2013.

[178] Andrew Clark, Andrew Witty of GSK: ‘Big Firms have allowed themselves to be seen as detached from society’, Guardian, March 20, 2011.  Rob Evans, How the Guardian was gagged from revealing Barclays tax secrets, Guardian, February 18, 2011.

[179] Ian Davis, Business and Society: The biggest contract – building social issues into strategy, big business can recast the debate about its role, The Economist, May 26, 2005.

[180] John Christensen and Richard Murphy, The Social Irresponsibility of Corporate Tax Avoidance: Taking CSR to the Bottom Line, 47 Development 37, 2004.

[181] Overhaul tax for the 21^st century, The Economist, August 9, 2018.

[182] Andrew Prokop, 40 charts that explain money in politics, Vox, July 30, 2014; Paul Blumenthal, Return on Lobbying Investment: 22,000%, Sunlight Foundation.com, April 9, 2009, Also see, Ian Traynor, 30,000 lobbyists and counting: is Brussels under corporate sway?, The Guardian, May 8, 2014; George Monbiot, How Corporate dark money is taking power on both sides of the Atlantic, The Guardian, February 2, 2017; James Hohmann, The Daily 202: Mick Mulvaney’s confession highlights the corrosive influence of money in politics, Washington Post, April 25, 2018; David Graham, Mick Mulvaney Says the Quiet Part Out Loud – head of the Consumer Finance Protection Bureau tells it like it is: if you want access to policymakers, it’s helpful to donate lots of money, The Atlantic, April 25, 2018; Renae Merle, Mulvaney discloses ‘hierarchy’ for meeting lobbyists, saying some would be seen only if they paid, Washington Post, April 25, 2018.

[183] Rohitesh Dhawan and Sean West, The CEO as Chief Geopolitical Officer, KPMG.com, 2018. Also see, 10 biggest corporations make more money than most countries in the world combined, Global Justice Now, September 12, 2016. Also see, Robin Wigglesworth, Larry Fink identifies China as critical BlackRock priority, Financial Times, April 8, 2018; Nyshka Chandran, Hopes are high for China to announce market access reforms on Tuesday, CNBC, April 9, 2018. Also see for example only, Amazon corporation and its CEO Jeff Bezo: Flora Carr, Amazon Is Now More Valuable Than Microsoft and Only 2 Other Companies Are Worth More, Fortune, February 15, 2018; Kate Vinton, Amazon CEO Jeff Bezos is the Richest Person in the World, Forbes, October 27, 2017; Chris Isidore, Jeff Bezos is the richest person in history, CNN, January 9, 2018; Ben Schiller, Is Amazon Killing Jobs and Destroying Communities? At what cost does convenience come? A new report says it’s not just jobs, but the rest of the economy as well, Fast Company, December 2, 2016; Olivia LaVecchia and Stacy Mitchell, Amazon’s Stranglehold: How the Company’s Tightening Grip Is Stifling Competition, Eroding Jobs, and Threatening Communities, Institute for Local Self-Reliance, November 2016.

[184] Robert Frank, Richest 1% now owns half the world’s wealth, CNBC, November 14, 2017; Benjamin Kentish, World’s richest 1% of people now own half global wealth, finds study, Independent.co.uk, November 14, 2017; David Meyer, The Richest 1% Now Own More Than 50% of the World’s Wealth, Fortune.com, November 14, 2017. 

[185] Just 8 men own same wealth as half the world, Oxfam.org, January 16, 2017; Larry Elliott (economics editor), World’s eight richest people have same wealth as poorest 50%, The Guardian, January 16, 2017; Reuters, The World’s 8 Richest Men are Now as Wealthy as Half the World’s Population, Fortune.com, January 16, 2017.

[186] Noah Kirsch, The 3 Richest Americans Hold More Wealth Than Bottom 50% of the Country, Study Finds, Forbes, November 9, 2017. Also see: Christopher Ingraham, The richest 1 percent now owns more of the country’s wealth than at any time in the past 50 years, Washington Post, December 6, 2017.

[187] Billionaire fortunes grew by $2.5 billion a day last year as poorest saw their wealth fall, Oxfam International (Oxfam.org), January 21, 2019; Max Lawson, etal, Public Good or Private Wealth?, Oxfam.org, January 2019.

[188] Rohitesh Dhawan and Sean West, The CEO as Chief Geopolitical Officer, KPMG.com, 2018. Also see, 10 biggest corporations make more money than most countries in the world combined, Global Justice Now, September 12, 2016. Also see, for example, see: Tim Roemer and Zach Wamp, John McCain’s warning about dark money is real. Stop campaign finance corruption, USA Today, May 8, 2018.

[189] Eric Sigurdson, Corporate Strategy and Geopolitical Risk in a G-Zero World: Inequality, Polarized Democracies, and the shifting economic and political landscape, Sigurdson Post, May 31, 2018. Also see, Business Among Friends: Why corporate tax dodgers are not yet losing sleep over global tax reform, Oxfam.org, May 2014; Mike Crawley, Ford Government’s top political staff hold ‘secretive’ meeting with business leaders: ‘refrain from mentioning this event on social media’, Ontario Chamber of Commerce tells invitees, CBC News, December 6, 2018; Martin Lukacs, Doug Ford isn’t ‘for the little guy’ – he’s a mercenary for the millionaire class, Guardian, May 25, 2018.

[190] Saskia Brechenmacher, Comparing Democratic Distress in the United States and Europe, Carnegie Endowment.org, June 21, 2018; Sinead Baker, Alexandria Ocasio-Cortez slams Harvard orientation for freshman lawmakers as ‘lobbyist project’ that hypes tax cuts for corporations, Business Insider, December 10, 2018.

[191] ICYMI: Sen. Cruz: It’s Time to Break the Washington Cartel – delivers speech exposing big government, bug business cronyism, U.S. Senator for Texas Ted Cruz (cruz.senate.gov), June 24, 2015. Also see, Jon Schwarz, ‘Yes, We’re Corrupt’: A List of Politicians Admitting That Money Controls Politics, The Intercept, July 30, 2015.

[192] Al Gore, The Future: Six Drivers of Global Change, Random House Publishing Group, 2013. Also see, Jon Schwarz, ‘Yes, We’re Corrupt’: A List of Politicians Admitting That Money Controls Politics, The Intercept, July 30, 2015.

[193] Anup Shah, Tax Avoidance and Tax Havens; Undermining Democracy, Global Issues.org, January 7, 2013; Is Sweeping Reform Necessary, Tax Me If You Can, Frontline, PBS, February 19, 2004.

[194] Lance Williams, Recording Reveals Oil Industry Execs Laughing at Trump Access, Politico, March 23, 2019.

[195] Lawrence Lessig, Mick Mulvaney shows why we need to radically change our elections, Washington Post, April 29, 2018. Also see, Amy Melissa McKay, Fundraising for Favors? Linking Lobbyist-Hosted Fundraisers to Legislative Benefits, Political Research Quarterly (journals.sagepub.com), April 24, 2018; Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, First Anchor Books Edition, 2016, 2017 (preface).

[196] The Global State of Democracy 2017: Exploring Democracy’s Resilience (chapter 5 – Money, influence, corruption and capture: can democracy be protected?), International Institute for Democracy and Electoral Assistance, 2017. Also see endnote #201.

^[197] Russ Feingold, US campaign finance laws resemble legalized bribery. We must reform them, Guardian, November 8, 2017.

[198] John Cartwright, Opinion: Cancel corporate tax cuts to deal with deficit, Toronto Star, July 11, 2010.

[199] Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018.

[200] Simon Lee, Common Good, Encyclopaedia Britannica (Britannica.com). Also see, for example: Professor Michael Sandel, Towards a just society, The Guardian, February 20, 2010.

[201] U.S.: George Monbiot, How Corporate dark money is taking power on both sides of the Atlantic, The Guardian, February 2, 2017; Jacob Hacker and Nathan Loewentheil, How Big Money Corrupts the Economy, Democracy Journal.org, Winter 2013; Charles Wheelan, It’s Official: In America, Affluence Equals Influence, US News.com, April 22, 2014; Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018; Andrew Prokop, 40 charts that explain money in politics, Vox, July 30, 2014; Ciara Torres-Spelliscy, Dark Money as a Political Sovereignty Problem, King’s Law Journal, Vol. 28, No. 2, 2017; Alex Tausanovitch, NRA, Russia and Trump: How ‘dark money’ is poisoning American democracy, CNBC, February 15, 2018; Matt Kelly, It’s Harder to Pay Off Foreign Governments than the American One: Novartis would think twice before giving hundreds of thousands of dollars to Vladimir Putin’s lawyer. But in Washington, the rules are different, BuzzFeed News, May 9, 2018; Fredreka Schouten, Exclusive: Three-quarters of the secret money in recent elections came from 15 groups, USA Today, September 12, 2018; Michael Beckel, Dark Money Illuminated, Issue One (issueone.org), 2018.

UK: George Monbiot, How Corporate dark money is taking power on both sides of the Atlantic, The Guardian, February 2, 2017; Duncan Hames, British politics is in the pocket of big money. And the EU vote was no exception, The Guardian, October 7, 2016; Tamasin Cave and Andy Rowell, The truth about lobbying: 10 ways big business controls government, The Guardian, March 12, 2014; Carole Cadwalladr, ‘Dark money’ is threat to integrity of UK elections, say leading academics, The Guardian, April 1, 2017, Ciara Torres-Spelliscy, Dark Money as a Political Sovereignty Problem, King’s Law Journal, Vol. 28, No. 2, 2017.

Australia: Mike Steketee, Donations and democracy: how money is compromising our political system, ABC News (abc.net.au), July 2, 2015; Gareth Hutchens, Labor senator Sam Dastyari claims 10 companies have taken control of Australian politics, Sydney Morning Herald, February 5, 2016; Warwick Smith, Political donations corrupt democracy in ways you might not realise, The Guardian, September 11, 2014; Professor Iain McMenamin, No bribes please, we’re corrupt Australians, The Conversation, May 30, 2016.

EU: Ian Traynor, 30,000 lobbyists and counting: is Brussels under corporate sway?, The Guardian, May 8, 2014; Money, Politics, Power: Corruptions Risks in Europe, Transparency International (transparency.eu), 2012.

Canada: Alan Yuhas, How Justin Trudeau Was Ensnared by Scandal: A Corruption Case and ‘Veiled Threats’, New York Times, March 4, 2019; Kristy Kirkup and Mia Rabson, Trudeau acknowledges ‘erosion of trust’ in SNC-Lavalin scandal, BNN Bloomberg, March 7, 2019; Nancy Macdonald, Welcome to British Columbia, where you ‘pay to play’, Maclean’s, February 11, 2017; Dan Levin, British Columbia: The ‘Wild West’ of Canadian Political Cash, New York Times, January 13, 2017; Ian Bailey, Donations taint B.C.’s approval of Trans Mountain pipeline expansion: advocacy group, Globe and Mail, January 31, 2017; Anver Emon, Foreign Dark Money Taints Canadian Parliamentary Proceeding, University of Toronto Faculty of Law (law.utoronto.ca), October 23, 2017; Linda McQuaig, Who owns Stephen Harper? Money in Politics. ‘Secret Donors’ Supported His Rise to Power, Global Research.ca, February 13, 2015 (and see, Now Toronto.com, February 4, 2015); Beth Hong, Charitable Fraser Institute received $4.3 million in foreign funding since 2000, Vancouver Observer, August 30, 2012; Anne Kingston, How Canada’s growing anti-abortion movement plans to swing the next federal election, Macleans.ca, September 12, 2018; Daniel Tencer, Koch Brothers, Tea Party Billionaires, Donated To Right-Wing Fraser Institute, Reports Show, Huffington Post, April 26, 2012; Warren Bell, Canada’s Republican prime minister, National Observer, October 18, 2015; The Far Right Dark Money Network Behind Conservative Politics: The Justice Centre for Constitutional Freedoms, North 99.org, January 26, 2018; Olivia Ward, Billionaire Koch brothers are big oil players in Alberta, Toronto Star, July 6, 2014; Daphne Bramham, Lessons for Canada from how the Koch brothers hijacked democracy, Vancouver Sun, September 25, 2016; Mitchell Anderson, Canada’s Real Problem with Intrusive Foreign Interests, The Tyee, February 24, 2014; David Sassoon, Koch Brothers’ Activism Protects their 50 Years in Canadian Heavy Oils, Reuters, May 10, 2012; Ed Finn (editor), Canada After Harper: His ideology-fuelled attack on Canadian society and values, John Lorimer & Company, 2015; Tristin Hopper, Stephen Harper at Bohemian Grove? Hacked email says ex-leader visited shadowy GOP summer camp, National Post, September 16, 2016; Dermod Travis, B.C. Politics Has a ‘Dark Money’ Problem, Huffington Post, December 9, 2015; Graham Thomson, Lone Liberal MLA David Swann warns of ‘dark money’ dangers, Edmonton Journal, November 2, 2017; Chrystia Freeland, Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else, Penguin Press, 2012.

[202] Tim Dunlop, Inequality is a political problem, not an economic one, ABC News (abc.net.au), November 27, 2013.

[203] Stephen Kobrin, Multinational Corporations, the Protest Movement and the Future of Global Governance, Chapter 9 in A. Chandler and B. Mazlish (editors), Leviathans: Multinational Corporations and the New Global History, Cambridge University Press, 2005. Also see, Dana Milbank, This is what happens when corporations run the government, Washington Post, March 15, 2019.

[204] Martin Wolf, A Republican tax plan built for plutocrats, Financial Times, November 21, 2017; John Wasik, How the GOP Tax Plan Scrooges Middle Class, Retired and Poor, Forbes, November 29, 2017; Peter Goodman and Patricia Cohen, It Started as a Tax Cut. Now It Could Change American Life, New York Times, November 29, 2017; Josh Hoxie, Trump’s Tax Cuts Are the Biggest Wealth Grab in Modern History, Fortune, November 3, 2017; Stan Collender, Paul Ryan’s Most Lasting Legacy: Permanent Trillion-Dollar Deficits, Forbes, April 11, 2018; Mark Warner, Congress and the $1 trillion deficit: time to be straight with the American People, CNBC, April 10, 2018; Stephen Gandel, Trump tax cut is the gift that keeps on giving, BNN Bloomberg.ca, May 25, 2018; Dylan Scott, House Republican: my donors told me to pass the tax bill ‘or don’t ever call me again’, Vox, November 7, 2017; Emily Stewart, Citigroup CEO explains why tax cuts outweigh Trump tweets – and Citibank reported a 24 percent profit jump. Here’s how they’re related, Vox, April 14, 2018; Bob Ryan, Top Republican senator says voting for the GOP tax law could be ‘one of the worst votes I’ve made’, Business Insider UK, April 11, 2018 (“This Congress and this administration likely will go down as one of the most fiscally irresponsible administrations and Congresses that we’ve had”); Tom Dickinson, How the GOP Became the Party of the Rich – the inside story of how the Republicans abandoned the poor and middle class to pursue their relentless agenda of tax cuts for the wealthiest one percent, Rolling Stone, November 9, 2011:

“To truly understand the depth of the GOP’s entrenched opposition to Obamacare [healthcare], it’s crucial to understand how the reform is financed: The single largest source of funds comes from increasing Medicare taxes on the wealthy – including new taxes on investment income. According to the Tax Policy Center, Americans who make more than $1 million a year will pay an extra $37,381 in annual taxes under the plan. The top 400 taxpayers [billionaires] would contribute even more: an average of $11 million each. Rarely in American history has a tax so effectively targeted the top one percent.” 

[205] Bloomberg, Trump signs executive orders cracking down on federal unions representing about 2.1 million employees, Los Angeles Times, May 25, 2018; Robert Barnes, Supreme Court rules that companies can require workers to accept individual arbitration, Washington Post, May 21, 2018; Adam Liptak, Supreme Court Upholds Workplace Arbitration Contracts Barring Class Actions, New York Times, May 21, 2018.

[206] Hilary Matfess and Michael Miklaucic (editors), Beyond Convergence: World Without Order, Center for Complex Operations at National Defense University, 2016 – see, Chapter 2, Nils Gilman, The Twin Insurgencies: Plutocrats and Criminals Challenge the Westphalian State; Lars Osberg, The Age of Increasing Inequality: The Astonishing Rise of Canada’s 1%, James Lorimer & Company Publishers, 2018; Daniel Tencer, Relentlessly Rising Wealth Disparity Threatens To Destabilize Canada: Author, September 11, 2018; Katrina vanden Heuvel, Trump’s budget is a bitter betrayal, Washington Post, March 19, 2019. Also see, Peter Goodman, Britain’s Big Squeeze: In Britain, Austerity is Changing Everything, New York Times, May 28, 2018; Matthew Snow, Against Charity, Jacobinmag.com, August 25, 2015; Peter Singer, Famine, Affluence, and Morality, Philosophy and Public Affairs, Vol. 1, No. 1, Spring 1972; Peter Singer, The Life You can Save, Random House, 2009; Jacob Silverman, The Billionaire Philanthropist, LongReads.com, March 13, 2018; Anand Giridharadas, Winners Take All: The Elite Charade of Changing the World, Alfred A. Knopf publisher, 2018. Also see,

[207] Hilary Matfess and Michael Miklaucic (editors), Beyond Convergence: World Without Order, Center for Complex Operations at National Defense University, 2016 – see, Chapter 2, Nils Gilman, The Twin Insurgencies: Plutocrats and Criminals Challenge the Westphalian State; Lars Osberg, The Age of Increasing Inequality: The Astonishing Rise of Canada’s 1%, James Lorimer & Company Publishers, 2018; Daniel Tencer, Relentlessly Rising Wealth Disparity Threatens To Destabilize Canada: Author, September 11, 2018; Katrina vanden Heuvel, Trump’s budget is a bitter betrayal, Washington Post, March 19, 2019. Also see, Peter Goodman, Britain’s Big Squeeze: In Britain, Austerity is Changing Everything, New York Times, May 28, 2018; Matthew Snow, Against Charity, Jacobinmag.com, August 25, 2015; Peter Singer, Famine, Affluence, and Morality, Philosophy and Public Affairs, Vol. 1, No. 1, Spring 1972; Peter Singer, The Life You can Save, Random House, 2009; Jacob Silverman, The Billionaire Philanthropist, LongReads.com, March 13, 2018; Anand Giridharadas, Winners Take All: The Elite Charade of Changing the World, Alfred A. Knopf publisher, 2018.

[208] Katrina vanden Heuvel, Trump’s budget is a bitter betrayal, Washington Post, March 19, 2019. Also see, Chuck Jones, Trump’s Additional Budget Deficit Was Largely Due To The Corporate Tax Cut, Forbes, October 31, 2018; Moody’s downgrades Ontario’s credit rating, citing deficit, revenue cuts under Doug Ford, Ottawa Citizen, December 14, 2018;

[209] Simon Tilford, As the rich get richer, why don’t British people care about inequality?, Guardian, September 18, 2018; Toby Sanger, A crisis of public revenue: progressive taxation can equalize and stabilize our economy while providing insurance against the next inevitable crash, Canadian Centre for Policy Alternatives, September 1, 2018; Christina Pazzanese, The costs of inequality: Increasingly, it’s the rich and the rest – economic and political inequalities are interlaced, Harvard Gazette, February 8, 2016; Tim Dunlop, Inequality is a political problem, not an economic one, ABC News (abc.net.au), November 27, 2013.

[210] Roberta Lexier and Avi Lewis, Corporate welfare bums: It’s payback time, The Conversation, December 5, 2018; Roberta Lexier and Avi Lewis, It’s Time ‘Corporate welfare bums’ Paid Canadians Back, Huffington Post, December 11, 2018.

[211] Hilary Matfess and Michael Miklaucic (editors), Beyond Convergence: World Without Order, Center for Complex Operations at National Defense University, 2016 – see, Chapter 2, Nils Gilman, The Twin Insurgencies: Plutocrats and Criminals Challenge the Westphalian State; Lars Osberg, The Age of Increasing Inequality: The Astonishing Rise of Canada’s 1%, James Lorimer & Company Publishers, 2018; Daniel Tencer, Relentlessly Rising Wealth Disparity Threatens To Destabilize Canada: Author, September 11, 2018. Also see, Peter Goodman, Britain’s Big Squeeze: In Britain, Austerity is Changing Everything, New York Times, May 28, 2018; Matthew Snow, Against Charity, Jacobinmag.com, August 25, 2015; Peter Singer, Famine, Affluence, and Morality, Philosophy and Public Affairs, Vol. 1, No. 1, Spring 1972; Peter Singer, The Life You can Save, Random House, 2009; Jacob Silverman, The Billionaire Philanthropist, LongReads.com, March 13, 2018; Anand Giridharadas, Winners Take All: The Elite Charade of Changing the World, Alfred A. Knopf publisher, 2018. Also see,

[212] Anand Giridharadas, Winners Take All: The Elite Charade of Changing the World, Alfred A. Knopf publisher, 2018.

[213] Franklin D. Roosevelt, President of the United States (1933-1945), Message to Congress on Curbing Monopolies, April 29, 1938, The American Presidency Project (presidency.ucsb.edu). Also see, Felix Salmon, Why the world elite won’t lift a finger to stop Trump, Splinter News.com, December 16, 2016.

[214] Chrystia Freeland, Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else, Penguin Press, 2012; Don Pittis, Plutocrats with the crony capitalism are taking over again in the U.S., CBC.ca, February 20, 2017; Nick Hanauer, To My Fellow Plutocrats: You Can Cure Trumpism – pay your workers a decent wage, Politico.com, July 18, 2017.

[215] Stephen Kobrin, Multinational Corporations, the Protest Movement and the Future of Global Governance, Chapter 9 in A. Chandler and B. Mazlish (editors), Leviathans: Multinational Corporations and the New Global History, Cambridge University Press, 2005.

[216] Daniel P. Tokaji, A Toxic Brew: Judicial Elections in the Age of Big-Money Politics, in The Politicization of Judicial Elections and Its Effect on Judicial Independence, 60 Cleveland State Law Review 461, 2012.

[217] See Eric Sigurdson, Corporate Strategy and Geopolitical Risk in a G-Zero World: Inequality, Polarized Democracies, and the shifting economic and political landscape, Sigurdson Post, May 31, 2018, endnotes #123 and #130 for specific references for the U.S., UK, Australia, EU, and Canada.  Also see, Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018; Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, First Anchor Books Edition, 2016, 2017 (preface); George Tyler, Billionaire Democracy: The Hijacking of the American Political System, BenBella Books, 2018; Fredreka Schouten, Exclusive: Three-quarters of the secret money in recent elections came from 15 groups, USA Today, September 12, 2018; Michael Beckel, Dark Money Illuminated, Issue One (issueone.org), 2018; Tim Dunlop, Three things must change for a healthier democracy, ABC.net.au, October 17, 2013. Also see, for example: Charles Kaiser, Dark Money review: Nazi oil, the Koch brothers and a rightwing revolution, The Guardian, January 17, 2016; Daniel Ben-Ami, Book Review: ‘Dark Money’, by Jane Mayer, Financial Times, March 11, 2016;Donald Gutstein, Harperism: How Stephen Harper and his think tank colleagues have transformed Canada, James Lorimer & Company Publishers, 2014; Daphne Bramham, Lessons for Canada from how the Koch brothers hijacked democracy, Vancouver Sun, September 25, 2016;Alan Ehrenhalt, ‘Dark Money’, by Jane Mayer, New York Times, January 19, 2016; Tim Roemer and Zach Wamp, John McCain’s warning about dark money is real. Stop campaign finance corruption, USA Today, May 8, 2018.

[218] Matthew Yglesias, American democracy is doomed, Vox, October 8, 2015; David Moss, Fixing What’s Wrong with U.S. Politics, Harvard Business Review, March 2012.

[219] As noted by the New York Times, “if you think globalization, immigration, trade and demographic change have contributed to displacement and political anger, wait until robots take away millions and millions of jobs, including those requiring the use of a well-trained brain” [Anand Giridharadas, When Technology Sets off a Populist Revolt, New York Times, August 29, 2016].  Until recently, technology has been an often overlooked—but significant—factor, and going forward you can expect technology to change the economy even more than globalization [Simon Veazey, The Impact of Technology’s Invisible Hand, Epoch Times, October 28, 2016; Hadi Partovi, A trillion-dollar opportunity for America, LinkedIn, January 9, 2017]. Federal Reserve Chair Janet Yellen has noted that globalization and technology has “reinforced the shift away from lower-skilled jobs that require less education, to higher-skilled jobs that require college and advanced degrees,” and that “the jobs that globalization creates” – serving a global economy of billions of people – “are more likely to be filled by those who have secured the advantage of higher education” [Akin Oyedele, Trump could be looking at the job market all wrong, Business Insider, January 8, 2017].

[220] Caitlin Zaloom, Does the U.S. Still Have a ‘Middle Class’?: White-collar work today is fundamentally insecure, The Atlantic, November 4, 2018; Stephen Harper, Populism’s rise points to real problems in our world. We ignore them at our peril, Globe and Mail, October 6, 2018; Overhaul tax for the 21^st century, The Economist, August 9, 2018; Daniel Tencer, OECD Report Warns of ‘Unprecedented Wage Stagnation’ in Developed Countries, Huffington Post, July 9, 2018; Pedro Nicolaci da Costa, There’s one simple explanation for the wage stagnation ‘puzzle’ confounding top Fed officials, Business Insider, August 29, 2018; Steve Johnson, Global unemployment hits lowest point for 4 decades: UBS survey highlights impact of labour flexibility, lower wages and interest rates, Financial Times, December 5, 2018; Leonid Bershidsky, Underemployment is the New Unemployment: Western countries are celebrating low joblessness, but much of the new work is precarious and part-time, Bloomberg, September 26, 2018; Suresh Naidu, Eric Posner, and Glen Weyl, More and more companies have monopoly power over workers’ wages. That’s killing the economy, Vox, April 6, 2018; Nick Hanauer, To My Fellow Plutocrats: You Can Cure Trumpism – pay your workers a decent wage, Politico.com, July 18, 2017; Aleksandra Sagen, Loblaw shareholders reject proposal to study feasibility of paying a living wage, Globe and Mail, May 3, 2018; Jesse M. Fried (Harvard Law School) and Charles C.Y. Wang (Harvard Business School), Short-Termism and Capital Flows, Working Paper 17-062, 2017; Amy Minsky, Average hourly wages in Canada have barely budged in 40 years, Global News, June 15, 2017; Drew DeSilver, For most U.S. workers, real wages have barely budged in decades, Pew Research Center, August 7, 2018.  Note: re wage stagnation also see – Stephen J. Rose, How Different Studies Measure Income Inequality in the US: Piketty and Company Are Not the Only Game in Town, Income and Benefits Policy Center, Urban Institute (urban.org), December 2018.

[221] The economic inequality perspective — emphasizes the consequences for electoral behavior arising from profound changes transforming the workforce and society in post-industrial economies. There is overwhelming evidence of powerful trends toward greater income and wealth inequality in the West, based on the rise of the knowledge economy, technological automation, and the collapse of manufacturing industry, global flows of labor, goods, peoples, and capital (especially the inflow of migrants and refugees), the erosion of organized labor, shrinking welfare safety-nets, and neo-liberal austerity policies.  According to this view, rising economic insecurity and social deprivation among the left-behinds has fueled popular resentment of the political classes. This situation is believed to have made the less secure strata of society – low-waged unskilled workers, the long-term unemployed, households dependent on shrinking social benefits, residents of public housing, single-parent families, and poorer white populations living in inner-city areas with concentrations of immigrants– susceptible to the anti-establishment, nativist, and xenophobic scare-mongering exploited of populist movements, parties, and leaders, blaming ‘Them’ for stripping prosperity, job opportunities, and public services from ‘Us’. [Ronald Inglehart and Pippa Norris, Trump, Brexit, and the Rise of Populism: Economic Have-Nots and Cultural Backlash, Harvard Kennedy School of Government, HKS Faculty Research Working Paper Series, August 2016]. Also see, Suresh Naidu, Eric Posner, and Glen Weyl, More and more companies have monopoly power over workers’ wages. That’s killing the economy, Vox, April 6, 2018.

[222] Caitlin Zaloom, Does the U.S. Still Have a ‘Middle Class’?: White-collar work today is fundamentally insecure, The Atlantic, November 4, 2018; Stephen Harper, Populism’s rise points to real problems in our world. We ignore them at our peril, Globe and Mail, October 6, 2018; Eric Sigurdson, Corporate Strategy and Geopolitical Risk in a G-Zero World: Inequality, Polarized Democracies, and the shifting economic and political landscape, Sigurdson Post, May 31, 2018.

[223] Rana Dasgupta, The demise of the nation state, The Guardian, April 5, 2018. Also see, Hilary Matfess and Michael Miklaucic (editors), Beyond Convergence: World Without Order, Center for Complex Operations at National Defense University, 2016 (see, Chapter 2, Nils Gilman, The Twin Insurgencies: Plutocrats and Criminals Challenge the Westphalian State, etc).

[224] Tim Wu, The Oppression of the Supermajority, New York Times, March 5, 2019.

[225] Benjamin Page, Jason Seawright, and Matthew Lacombe, What billionaires want: the secret influence of America’s 100 richest – new study reveals how the wealthy engage in ‘stealth politics’; quietly advancing unpopular, inequality-exacerbating, highly conservative policies, Guardian, October 31, 2018. Also see, U.S.: Jane Meyer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, Random House, 2016; Margaret Renkl, The Death of Compassionate Democracy – following the Koch playbook, Tennessee keeps finding new ways to undermine the welfare of its citizens, New York Times, March 18, 2019 (“According to Dr. MacLean, the Koch network’s goal — and the goal of all legislators in thrall to the Kochs’ PACs — is to weaken unions, suppress voter turnout, privatize public education, undercut climate science, roll back existing environmental protections, dismantle the social safety net and, of course, stack the courts with sympathetic judges.”); Nancy MacLean, Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for American, Penguin Books, 2017; Lee Drutman, How Corporate Lobbyists Conquered American Democracy, Atlantic, April 20, 2015; Jacob Hacker and Nathan Loewentheil, How Big Money Corrupts the Economy, Democracy Journal.org, 2013; , Janine Wedel, Dana Archer Dolan, and Nazia Hussain, Political Rigging: A Primer on political capture and influence in the 21^st century, Oxfam America, 2017.  Australia: George Rennie, Lobbying 101: how interest groups influence politicians and the public to get what they want, The Conversation, June 9, 2016; Kate Griffiths, Carmela Chivers, and Danielle Wood, Influence in Australian politics needs an urgent overhaul – here’s how to do it, The Conversation, September 23, 2018; John Warhurst, Australia’s unrestricted political lobbyists, Sydney Morning Herald, October 18, 2017; Christopher Knaus, One in four Australian ministers go on to work for lobbyists or special interests, study finds, The Guardian, September 23, 2018. Canada: Bruce Livesey, Is the Oil Industry Canada’s ‘Deep State’?: From influencing politicians to shaping public opinion, industry strives to control energy policy, The Tyee, May 17, 2018; Evan Annett and Tu Thanh Ha, Political Donations in Canada: a guide to the ‘wild west’ vs the rest, Globe and Mail, March 14, 2017; Robert Benzie, Tories accused of selling access to Doug Ford with $1,250 fundraiser tickets, Toronto Star, February 25, 2019; Chad Skelton, Lobbying: Oil, gas companies are the top B.C. lobbyists, Vancouver Sun, March 21, 2014; Laura Stone and Jill Mahoney, MPP Randy Hillier says he was expelled from PC caucus after raising concerns about unregistered lobbying, Globe and Mail, March 18, 2019. EU: Harry Cooper, Ginger Hervey, Etienne Bauvir and Ioannis Antypas, Big East – West skew in record EU lobbying bonanza, Politico, December 13, 2017; Lobby Planet: The Corporate Europe Observatory guide to the murky world of corporate EU lobbying, Vol. 3, Corporate Europe Observatory, June 2017; Captured States: when EU governments are a channel for corporate interests, Corporate Europe Observatory, February 2019. UK: George Monbiot, Dark money is pushing democracy in the UK over the edge, Guardian, May 17, 2017; Carole Cadwalladr, The great British Brexit robbery: how our democracy was hijacked, Observer, May 7, 2017; Working for the Few: political capture and economic inequality, Oxfam.org, 2014. OECD: Lobbyists, Governments and Public Trust: Implementing the OECD principles for transparency and integrity in lobbying, OECD, 2014.

[226] Dana Milbank, This is what happens when corporations run the government, Washington Post, March 15, 2019.

[227] Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018. Also see, George Tyler, Billionaire Democracy: The Hijacking of the American Political System, BenBella Books, 2018; Alexander Burns, Jasmine Lee, and Rachel Shorey, Billionaire vs. Billionaire: A Tug of War Between 2 Rogue Donors, New York Times, April 12, 2018. Also see, Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, First Anchor Books Edition, 2016, 2017 (preface); Charles Kaiser, Dark Money review: Nazi oil, the Koch brothers and a rightwing revolution, The Guardian, January 17, 2016; Daniel Ben-Ami, Book Review: ‘Dark Money’, by Jane Mayer, Financial Times, March 11, 2016; Alan Ehrenhalt, ‘Dark Money’, by Jane Mayer, New York Times, January 19, 2016; Donald Gutstein, Harperism: How Stephen Harper and his think tank colleagues have transformed Canada, James Lorimer & Company Publishers, 2014; Bruce Livesey, How Canada made the Koch brothers rich, National Observer, May 5, 2015; Gerald Caplan, Harper is Right: Foreign radicals are after the oil sands, Globe and Mail, May 26, 2012; Daniel Tencer, Koch Brothers, Tea Party Billionaires, Donated To Right-Wing Fraser Institute, Reports Show, Huffington Post, April 26, 2012; Daphne Bramham, Lessons for Canada from how the Koch brothers hijacked democracy, Vancouver Sun, September 25, 2016; Elizabeth McSheffrey, Are the billionaire American Koch brothers playing climate politics in Alberta?, National Observer, January 13, 2017.

[228] Andrew Ross Sorkin, How Executives Vote With Their Wallets – A Harvard study found that executives donate more heavily to Republicans. But the gap is surprising, New York Times, March 19, 2019.

[229] See generally: Neil Abernathy and Steph Sterling, GOP tax scam: How corporations and the rich are fueling inequality, USA Today, December 18, 2017; Kate Tuttle, Jane Mayer discusses her book ‘Dark Money’ and its ongoing relevance, Los Angles Times, April 12, 2017; Jane Meyer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, Random House, 2016; Alan Greenblatt, Trends in Philanthropy: Do wealthy donors have too much influence?, CQ Researcher, March 8, 2019; Victor Reklatis, Secret political spending on track to reach $1 billion milestone, Market Watch, November 26, 2018; George Monbiot, Dark money lurks at the heart of our political crisis, Guardian, July 18, 2018; Jeffrey Sachs, Scott Pruitt sums up America’s big challenge, CNN, April 10, 2018; David Boaz, How Washington power might corrupt Google, USA Today, February 4, 2018; Bill Cotterell, Thin line between political fundraising and bribery, Tallahassee Democrat (news-press.com), August 9, 2014; George Rennie, Everyone wants an end to ‘bad lobbying’. Except the major parties, Guardian, November 7, 2017; Kim Willsher, Nicolas Sarkozy to face trial for corruption and influence peddling: Ex President allegedly tried to bribe judge investigating claims 2007 election campaign was illegally funded, The Guardian, March 29, 2018; Isabel Kershner, Benjamin Netanyahu Is Questioned in 3^rd Corruption Case in Israel, New York Times, March 2, 2018; Oren Liebermann and James Masters, Israeli police find ‘sufficient evidence’ to indict Benjamin Netanyahu, CNN, February 13, 2018; Whitney Eulich, In Brazil, support for anti-corruption drive – and the president it convicted, Christian Science Monitor, April 10, 2018; Christine Lagarde, There’s a reason for the lack of trust in government and business: corruption, The Guadian, May 4, 2018.

[230] Christine Lagarde, There’s a reason for the lack of trust in government and business: corruption, The Guardian, May 4, 2018.

[231] Nathan Lewis, The Crisis of Capitalism Is a Lack of Capitalism, Forbes, February 23, 2012.

[232] Christopher Ingraham, Wealth Concentration returning to ‘levels last seen during the Roaring Twenties’, according to new research, Washington Post, February 8, 2019 (citing Professor Gabriel Zucman); Jacob Hacker and Paul Pierson, Winner-Take-All Politics: How Washington Made the Rich Richer – and Turned its Back on the Middle Class, Simon & Schuster, 2010.

[233] Eliza Relman, ‘2020 class warfare?’: Alexandria Ocasio-Cortez and the left face off against billionaires in a fight to tax the rich, Business Insider, February 2, 2019. For examples see, Canada: Grace Dobush, Understanding the Scandal That’s Tarnished Justin Trudeau’s Glowing Image, Fortune, March 5, 2019; Robert Fife, Steven Chase, and Steven Fine, PMO pressed Wilson-Raybould to abandon prosecution of SNC-Lavalin: Trudeau denies his office ‘directed’ her, Globe and Mail, February 7, 2019; Andy Blatchford, SNC-Lavalin CEO Neil Bruce Urged Federal Cabinent to Change Corruption Laws ‘Expeditiously’, Huffington Post, March 6, 2019. EU: Carole Cadwalladr and Duncan Campbell, Revealed: Facebook’s global lobbying against data privacy laws, Guardian, March 2, 2019. U.S.:  Eric Reguly, The U.S. versus the World: Politics Cloud the Boeing Max disasters, Globe and Mail, March 13, 2019; David Gelles, Thomas Kaplan, Kenneth Vogel, and Nathalie Kitroeff, Boeing Flights Grounded Across the Globe, but Not in the U.S., New York Times, March 12, 2019.

[234] Wayne Swan, Tax avoidance impoverishes us all. Fighting it requires challenging the powerful, Guardian, January 11, 2016; Tax reforms accelerating with push to lower corporate tax rates, OECD.org, May 9, 2018; Tax Policy Reforms 2018: OECD and Selected Partner Economies, OECD Publishing, 2018; Brian Peccarelli, As some major economies cut their corporate tax rates – what will happen next?, World Economic Forum, January 19, 2018; William Gale and Leonard Burman, Congress missed an opportunity to reform the corporate tax, Brookings.edu, December 26, 2017; Jessica Irvine, What economists really think about cutting corporate tax, Sydney Morning Herald, February 23, 2018; Shane Wright, Australia has world’s third highest corporate tax rate, Sydney Morning Herald, January 15, 2019; Marco Chown Oved, Toby Heaps, and Michael Yow, The High Cost of Low Corporate Taxes, Toronto Star, December 14, 2017; Jamie Smyth, Australia joins global push to cut corporate tax rates, Financial Times, February 8, 2018; Esme Berkhout, Tax Battles: The dangerous global Race to the Bottom on Corporate Tax, Oxfam Policy Paper (Oxfam.org), December 12, 2016.

[235] Jonathan Tepper and Denise Hearn, Big companies are crushing their competition in the US, and it’s creating a dangerous ‘fake capitalism’ that hurts workers and consumers, Business Insider, January 15, 2019; Jonathan Tepper and Denise Hearn, The Myth of Capitalism: Monopolies and the Death of Competition, John Wiley & Sons, 2019.

[236] Christopher Ingraham, Wealth Concentration returning to ‘levels last seen during the Roaring Twenties’, according to new research, Washington Post, February 8, 2019. Also see, Gabriel Zucman, Global Wealth Inequality, NBER Working Paper No. 25462, National Bureau of Economic Research, January 2019;

[237] Eric Weinstein, Why capitalism won’t survive without socialism: Eric Weinstein on the crisis of late capitalism, Vox, July 4, 2018.

[238] Stephen M. Walt, America’s Corruption Is A National Security Threat, Foreign Policy, March 19, 2019; Stephen M. Walt, The US is a lot more corrupt than Americans realize, and the problem goes much deeper than Trump, Business Insider, March 20, 2019.

[239] See for example, Saskia Brechenmacher, Comparing Democratic Distress in the United States and Europe, Carnegie Endowment.org, June 21, 2018; E.J. Dionne Jr., Are Republicans abandoning democracy?, Washington Post, December 9, 2018; David Leonhardt, The Corporate Donors Behind a Republican Power Grab, New York Times, December 9, 2018.

[240] Torrey Taussig and Bruce Jones, Democracy in the new geopolitics, Brookings.edu, March 22, 2018.

[241] What is populism?, The Economist, December 19, 2016.

[242] Editorial Board, Macron, at the Barricades, Warns of Rising Nationalism in Europe, New York Times, April 18, 2018; Editorial Board, Leaders worldwide are falling for a ‘deadly illusion’, Washington Post, April 18, 2018; Adam Fleming, France’s Macron urges EU to shun nationalism, BBC.com, April 17, 2018; Pablo Gorondi, Populist Prime Minister Viktor Orban Wins Third Consecutive Term in Hungary, Time, April 9, 2018; Neil Buckley and Andrew Byrne, The rise and rise of Viktor Orban – the man who has turned Hungary into a semi-authoritarian regime was once a democratic activist. What happened?, Financial Times, January 25, 2018; Eric Reguly, Analysts fear economic repercussions as Italy’s anti-establishment parties agree to form government, Globe and Mail, May 14, 2018; Lauren Said-Moorhouse, Hilary Clarke, and Euan McKirdy, Italy’s voters choose populists, deliver stinging rebuke to Europe, CNN, March 5, 2018; Stephanie Kirchgaessner, Italy’s voters ditch the centre and ride a populist wave, The Guardian, March 5, 2018; Ronald Inglehart and Pippa Norris, Trump, Brexit, and the Rise of Populism: Economic Have-Nots and Cultural Backlash, Harvard Kennedy School of Government, HKS Faculty Research Working Paper Series, August 2016; Hendrik Brakel, Oscar Williams-Grut, Brexit and Trump are just the start – populism will strike Europe next, Business Insider, November 10, 2016; Pippa Norris, Its not just Trump. Authoritarian populism is rising across the West. Here’s why, Washington Post, March 11, 2016; Andrew Cumbers, Economically marginalized voters played a critical role in Trump’s rise, Brexit, and a shift to the far right in Europe, Business Insider, January 13, 2017; Elaine Ganley, Marine Le Pen’s new, less racist, vision for France has her ahead in the polls: Le Pen sees ‘grand return’ of nationalism and a new France, Toronto Star, January 12, 2017; 5 Minutes for Business: Rise of the Trumps – Why Populism is all the Rage, Canadian Chamber of Commerce, Burnaby Board of Trade, February 9, 2016; Barclays: ‘Markets may have taken the wrong lessons from Donald Trump and Brexit’, Business Insider, January 13, 2017; Torrey Taussig and Bruce Jones, Democracy in the new geopolitics, Brookings.edu, March 22, 2018; Pippa Norris, Its not just Trump. Authoritarian populism is rising across the West. Here’s why, Washington Post, March 11, 2016. Also see, for example: Cas Muddle, The Trump phenomenon and the European populist radical right, Washington Post, August 26, 2015; Paul Krugman, Populism, Real and Phony, New York Times, December 23, 2016.

[243] Ian Bremmer, A world in turmoil: What we must do to survive the coming political crisis, Globe and Mail, April 20, 2018. Also see, Jack Houston, Sara Silverstein and Lauren Shamo, The founder of the World Economic Forum shares what he sees as the biggest threat to the global economy, Business Insider, January 14, 2018; The rules-based system is in grave danger, The Economist, March 8, 2018; We need a new international order. Here’s why, World Economic Forum, June 21, 2018.

[244] Andrew Hill, Mehreen Khan, and Richard Waters, The global hunt to tax Big Tech, Financial Times, November 2, 2018.

[245] Louis D. Brandeis Quotes, Louis D. Brandeis Legacy Fund for Social Justice, Brandeis University (brandeis.edu).  Also cited in Christina Pazzanese, The costs of inequality: Increasingly, it’s the rich and the rest – economic and political inequalities are interlaced, Harvard Gazette, February 8, 2016.

[246] Eric Sigurdson, Corporate Strategy and Geopolitical Risk in a G-Zero World: Inequality, Polarized Democracies, and the shifting economic and political landscape, Sigurdson Post, May 31, 2018; World Economic Forum in Davos out to heal ‘a fractured world’, Deutsche Welle (DW.com), January 23, 2018; Susan Glasser, How Trump Made War on Angela Merkel and Europe, New Yorker, December 17, 2018 (“Trump has begun publicly calling the E.U. a “foe,” and promoting the resurgence of nationalism … . Trump’s Secretary of State, Mike Pompeo, in a recent speech at the German Marshall Fund in Brussels, attacked the United Nations, the E.U., the World Bank, and the International Monetary Fund, and derided what he called Europe’s flawed vision of multilateralism as “an end to itself.”); Salman Ahmed and Alexander Bick, Trump’s National Security Strategy: A New Brand of Mercantilism?, Carnegie Endowment for International Peace, August 17, 2017.

[247] Valerie Keller, Healing a fractured world by changing the rules of the game, LinkedIn, January 24, 2018.