- The Washington Times - Wednesday, March 20, 2002

Calls for a world tax to help fight poverty have surfaced anew at a Mexico summit on development that President Bush will attend tomorrow and were immediately rebuffed by the White House.
Global tax proposals have called for the United Nations or other international institutions to tax activities such as airline travel, currency transfers and carbon emissions with the receipts going to either pay the U.N. budget or to fund international development projects in the Third World.
Britain, Germany and two other European countries led efforts to insert the global tax concept into the draft declaration that the International Conference on Financing for Development is expected to adopt this week.
U.S. officials said they managed with the help of Japan and other donor nations to remove the global tax plan from the final draft.
But yesterday the host of the summit, Mexican President Vicente Fox, revived the plan with a call for global taxes to fight poverty a plan swiftly rejected by the Bush administration.
The Mexican president, embraced as a friendly neighbor by Mr. Bush, said in a newspaper column that "global taxes such as the one proposed on carbon emissions could be … providing money for development and also a more efficient use of scarce resources."
The global tax proposed by Mr. Fox yesterday in an opinion column in The Washington Post, "was a non-starter the United States would never go for such a tax," said Patrick Cronin, assistant administrator for the U.S. Agency for International Development.
"You can't put the cart before the horse and tax wealthy countries and then figure out how to use it," Mr. Cronin said.
State Department spokesman Richard Boucher said, "The U.S. government has seen these kind of [global tax] proposals from time to time in the past and going over many administrations, and I don't remember any of them that the U.S. government supported, frankly."
Former U.N. Secretary-General Boutros Boutros-Ghali in 1996 proposed similar taxes on airline tickets and international currency transactions.
The plan so irked then-Senate Majority Leader Bob Dole, Kansas Republican, that he proposed a bill mandating a U.S. pullout from the United Nations if such a tax was approved or even discussed.
Mr. Dole's bill died in the Senate Foreign Relations Committee, but U.S. opposition to global taxes remained strong and contributed to Mr. Boutros-Ghali's being denied a second U.N. term.
In September, global tax plans were inserted into the draft declaration for this week's Monterrey, Mexico, conference.
A U.S. official speaking on the condition of anonymity said the plan was pushed by four development ministers: Claire Short from Britain and ministers from Germany and two Nordic countries.
But objections by the United States and other wealthy nations stripped out the global tax provision, said Mr. Cronin. By January, the third and final preparatory committee meeting issued its final 16-page draft without any mention of a global tax.
The Nobel laureate and Yale economics professor James Tobin first proposed a global tax on currency transactions to fund development of poor countries, although before his recent death he said he had abandoned the concept.
Mr. Fox proposed a tax on carbon emissions "to finance global public goods."
These would include access to global health care information or systems that transcend state boundaries such as trade standards, said Mr. Cronin.
Mr. Fox is the first Mexican president in 70 years not from the Institutional Revolutionary Party (PRI), and he has toned down the traditional anti-American and anti-capitalist rhetoric always popular in Mexico.
He also called for open U.S. borders for Mexican migrant laborers and strong measures to protect the human rights of illegal Mexican immigrants in the United States.
Mr. Fox is also a leader in the developing world, where the idea of a global tax on wealthy countries is quite popular.
Mr. Cronin said the goal of the Monterrey conference is to put in place standards to assure current foreign assistance is effective.
"The first priority is, 'What do you want to spend money on?' " he said. "Instead, some people are saying, 'Let's tax the wealthy and say later how to spend it.'"
Mr. Cronin said that "in the right time, there could be a serious discussion" about global taxes.
"We live in a small planet that is not getting bigger while we are getting more numerous," he said.
He said that global taxes already exist in the form of U.N. dues and fees for running the World Trade Organization and other international groups.
Last week, Mr. Bush pledged a $5 billion increase in U.S. foreign aid in each of the next three years and suggested the money be given as grants to countries with relatively stable financial and political systems.


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