A better world is possible - Global Commons Institute

Copyright Bruce Nixon 2010. All rights reserved. This electronic copy is provided free for personal, non-commercial use only.
www.brucenixon.com
"Developing countries are estimated to lose to tax havens almost three times what they get from developed
countries in aid."
Angel Gurría, OECD Secretary-General, November 2008.
Tax evasion by multinational corporations
Climate change aid Whilst, under the Kyoto agreement, rich countries are under a legal obligation to help
poor countries adapt to climate change, little has been delivered. Of the $18bn (£12.5bn) pledged by rich
countries over the past seven years, less than $900m or 5-10%, has been delivered. The very small
proportion that has been delivered has gone to the poorest countries like those in Africa. Much of this aid
comes fro other aid budgets leaving less for health, education and poverty action. Britain has pledged $1.5bn
but delivered less than $300m.
Vulture Funds Vulture funds based in New York and London are the latest example of ruthless greed. It is
reported that so-called vulture funds are buying up the debt of extremely poor countries and then suing
them. At least 54 companies are known to have taken legal action against 12 of the world`s poorest countries
in recent years, for claims amounting to over $1.8bn (£1.2bn). For example the government of the war-torn
Democratic Republic of Congo is incurring fines of $20,000 a week in a case brought by a New York-based
vulture fund over a debt incurred from Tito's Yugoslavia in the 1980s. Another example is a London law firm
seeking a $40m payment from Zambia on a $40m debt.
Poverty and the growing income gap in UK
Ours is a very unequal country. There is an escalating gap between rich and poor in UK and between North
and South.
Until thirty years ago, real incomes were rising and the poverty gap was reducing. I do not want to paint a
rosy picture of that time. There were profound problems that had to be resolved, especially in the UK
economy. The world had changed; we were not adapting. Mrs Thatcher was confronted with a major crisis.
Unions were abusing their power. British business leadership and entrepreneurialism were in deep decline.
However, “trickle-down” she promised did not deliver.
In the UK, growth benefits the richest 10 per cent of the population 10 times more than the poorest 10 per
cent. The ratio between bosses' rewards and employees' pay has risen to 98:1 from 39:1 ten years ago.
Before the current crisis, average total pay for a UK chief executive was £2,875,000, more than 11 times the
increase in average earnings and nearly 20 times the rate of inflation as measured by the consumer price
index. Basic salary increases were more than three times the 3.1% average pay rise for ordinary workers in
the private sector. Directors' basic pay rise, over double the rate of inflation, came whilst many of their
companies were imposing pay freezes on staff and starting huge redundancy programmes to slash costs. The
10 most highly paid executives earned a combined £170m in 2008 – up from £140m in 2007. Five years
before, the top 10 banked some £70m. Women bosses are still left behind. These figures do not include all
the “perks”.
There is a sharp contrast between the pension schemes of top directors and employees, many of whom face
uncertainty. Pension schemes for ordinary workers have been steadily diminished, in some cases raided, over
the past twenty years. Yet 26 top directors will retire on annual incomes between £500,000 and £1m plus;
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