NEF: Britain leads devastating race to bottom on financial regulation
Reposted with permission from the Treasure Islands Blog:
Now, following Jeffrey Sachs' encouraging article in the Financial Times, I note this important new report from the New Economics Foundation in London entitled UK holding back progress on global financial stability, says nef. I'm delighted to see that it quotes Treasure Islands in several places (and it quotes TJN's director, John Christensen). Now look what they are saying in their press release, entitled :
The UK itself is a ‘haven’ that threatens the stability of the global economy. We call for the UK to live up to its image as a pre-eminent global financial centre and demonstrate strong international leadership on better regulation instead of pandering to vested financial interests.”
- Tony Greenham, head of Finance and Business at nef.
Absolutely. The message is getting out. This stuff was simply not being said until very recently. Why it's taken so long for the world to wake up is a mystery. And look at what else there is:
By engaging in a race-to-the-bottom on financial reform, the UK undermines global financial stability with potentially devastating consequences for the global economy. . .
In several cases the UK is actively choosing to not tackle tax havens. While the UK claims it cannot influence tax havens, many are UK Crown Dependencies or Overseas Territories, where a past history of intervention suggests otherwise. HM Treasury confirms that the UK has reserve powers enshrined in the constitutions of the Overseas Territories to affect and block legislation. The UK also has the power to intervene to uphold ‘good governance’ in the Crown Dependencies. . . The UK exerts a downward pressure on the quality of financial regulation in a range of ways.
Will you look at that. If you've read Treasure Islands, you will be nodding your head furiously. I am nodding as I read the NEF report, which I didn't know anything about until this morning. What is more, NEF has done a lot of good work fleshing out my own, looking at London's role in leading the race to the bottom on commodity trading, the Alternative Investment Market (AIM), and in undermining EU efforts to tackle problems associated with naked short-selling.
As I've just said, the message is spreading. And look at the kind of recommendations they are making:
- Tax havens: Eliminate tax havens that are under UK control, and work with the US, the EU and other international authorities to co-ordinate regulation of global tax evasion and avoidance.