Alternatives to reverse the crisis in Europe

22 April 2014 by Eric Toussaint

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This text proposes a series of concrete alternatives to counter the current crisis shaking Europe. It presents nineteen immediate measures that should be taken vis-à-vis finance in general and the banking sector in particular. In addition to these measures, it proposes to socialise the banking and insurance sectors, and to place them under citizen control. It then examines ten measures to be taken to reverse the crisis in a way that will be favourable to the vast majority of people. 1. Stopping austerity plans; 2. Repudiating all illegitimate, unsustainable, odious, and illegal public debt; 3. Cancelling all illegitimate and illegal private debt; 4. Increasing the resources of public authorities; 5. Decreasing inequalities by establishing fiscal justice; 6. Setting up legitimate government borrowing; 7. Developing and extending public services; 8. Strengthening the pension system based on intergenerational solidarity; 9. Radically decreasing working hours to guarantee jobs for everyone, and adopting an income policy that will bring about social justice; 10. Questioning the basis of the euro and taking action to build a different Europe, which would mean replacing the current treaties based on a true democratic process involving all the peoples of Europe. These are the propositions the CADTM is putting forward for discussion and debate.

As of the 1980s, the private banking sector succeeded in freeing itself from the constraints that public authorities had established and maintained for several decades in order to prevent another banking crisis like the one that occurred in the 1930s. Regulators and governments that believed in neoliberal ideology gave free rein to capitalist bankers, who took full advantage of the situation. These events took place in a context in which the major financiers took their revenge and undermined the social rights gained by workers, which were in the interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. of the vast majority of people. The current crisis, which began in 2007-2008, has not made public authorities impose strict rules on private capital. The few measures adopted and the paltry mechanisms envisaged to clean up the private financial sector are completely inadequate for preventing new financial crises or curbing the dangerous, speculative behaviour engaged in by financial institutions.

The economic, social, and cultural rights laid out in the Universal Declaration of Human Rights, and codified in an international covenant in 1966 [1] are being seriously undermined. [2] The civil and political rights of citizens [3] are also being attacked on a daily basis by governments and international institutions [4] in a way that is favourable to major capital owners: the peoples are not asked for their opinions on questions as important as the bailing out of private banks and how they should be used in the future, privatising public corporations and public services, or whether or not European treaties should be adopted. The choices made by voters are not respected, the constitution is trampled on, [5] and the legislative body has been marginalised or relegated to simply rubber-stamping decisions made by others.

The financial crisis falls within a much broader systemic crisis of global capitalism, and is multi-faceted with economic, ecological, social, political, moral, and institutional dimensions.
We need to make a radical break with the mindset of today’s leader, and take urgent measures. Those who are responsible for bank meltdowns must to obliged to pay for the bailouts, contrary to the current system, which offers golden parachutes to those responsible for the economic disasters, instead of punishing them.

The measures announced to discipline the banks are superficial. The centralised supervision of eurozone banks, creation of a European deposit guarantee scheme, prohibition of certain operations (concerning only 2% of global banking activities), capping of bonuses, transparent banking activities, and even the new banking rules are merely recommendations, promises, or, at best, completely inadequate measures compared to the problems we must resolve. Instead, we must impose truly strict and universally applicable rules.

To get beyond this crisis, we should implement measures that would affect the very structure of the financial world and capitalist system.
The banking business is too crucial to be left in the hands of the private sector. Therefore, we must socialise the banking sector, which means expropriating the banks, and placing them under citizen control (by bank employees, clients, associations, and representatives of local public stakeholders), because banks should be run as a public service, [6] and the revenues generated by banking activities should be used for the common good.
The public debt incurred to save the banks is clearly illegitimate and must be repudiated. A citizens audit must be conducted to determine the other illegitimate, illegal, odious, and unbearable debts, and help to create a mobilisation through which a credible anticapitalist alternative can emerge.
These two measures must be part of the broader programme described in this paper, which should start with the measures to be taken immediately in the financial sector.

Citizen mobilisation and social self-organisation are indispensable for achieving the different ideas proposed hereafter. Without them, there will be no truly emancipatory solution to the current crisis.

I. Immediate measures to be taken concerning finance in general and banks in particular

As mentioned in the introduction, socialised banking is our ultimate goal concerning banks everywhere. However, already today minimal but real measures aiming to expropriate the financial sector can unite movements, unions, political parties, and persons, who do not necessarily have the same vision, around a common platform.
Here is a list of 19 real and possible measures the CADTM is proposing.
1) Radically cut down the size of the banks so there are no longer banks that are “Too Big to Fail,” which represent a risk for the whole system. [7]
2) Separate deposit bank* activities from investment bank* activities. This implies the splitting up of universal banks (which engage in deposit banking, investment banking, and insurance activities at the same time) into different legal entities. [8] Deposit banks would be the only institutions authorised to collect deposits and savings from people and obtain support from public authorities (a public guarantee on deposits and access to central bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

liquidities Liquidities The capital an economy or company has available at a given point in time. A lack of liquidities can force a company into liquidation and an economy into recession. ). [9]. Only these banks would be allowed to make personal loans to depositors and savers, loans to businesses and to local and national public authorities. It will be forbidden for them to conduct business on the financial markets.
a). They would be prohibited from engaging in any kind of securitisation: loans may not be converted into tradable securities, and must be retained on their books until the loans granted have been fully reimbursed. A bank that grants a loan must bear the risk it entails.
b). On the other hand, investment banks (and commercial banks) must obtain their resources on the financial markets in order to issue bonds, shares, and other financial instruments Financial instruments Financial instruments include financial securities and financial contracts. . [10]
c). We also support the proposition made by Philippe Lamberts to limit the weight of security-backed instruments in investment bank portfolios by making them retain, say 60%, [11] of the tradable securities in their own books and thereby bear more of the risk. On the other hand, it would be surer to simply prohibit securitisation of any kind, as we propose for deposit banks.
d). It is important to point out that investment banks should not enjoy any kind of public underwriting. In the case of bankruptcy, all losses should be fully assumed by the private sector, starting with the shareholders (on all of their assets, see below).
3) Prohibit derivatives Derivatives A family of financial products that includes mainly options, futures, swaps and their combinations, all related to other assets (shares, bonds, raw materials and commodities, interest rates, indices, etc.) from which they are by nature inseparable—options on shares, futures contracts on an index, etc. Their value depends on and is derived from (thus the name) that of these other assets. There are derivatives involving a firm commitment (currency futures, interest-rate or exchange swaps) and derivatives involving a conditional commitment (options, warrants, etc.). . This would mean that investment banks, and other financial actors, wishing to hedge against risks (exchange and interest rate fluctuations, payment defaults) would have to go back to using classic insurance policies.
4) Impose pre-commercialisation compliance controls on all new financial products proposed to the markets. Philippe Lamberts (MEP) proposes to do this and to subject the products to “marketing authorisations” before commercialisation. As said before we prefer the complete prohibition of derivatives. Nevertheless, we support this proposition, as well as the similar one advanced by the “Copernic Foundation.” [12]
5) Prohibit credit relationships between deposit and investment banks. We agree with Fréderic Lordon who supports the total separation of deposit banks and investment banks. A deposit bank must in no way be involved in a credit relationship with an investment bank. [13]
6) Separate advice activities from commercial activities. We also agree with the proposal made by the Belgian economist Eric de Keuleneer to separate advice activities from market operations, “It is quite abnormal that banks take investment risks and then advise customers on the quality of these investments, or be, so called ’independent’, advisers on gold portfolio management at the same time as they speculate on gold.” Instead, he proposes to re-establish brokerage activities.
7) Prohibit speculation. As Paul Jorion proposes, speculation should be prohibited. “Speculation has been authorised in France since 1885 and in Belgium since 1867. Speculation was clearly defined by the law, which aimed to ’prohibit bets on the rise or fall of the price of financial instruments’. With such a restriction whoever practised speculation would be violating the law, whatever bank was involved.” [14] It would be illegal for a bank to speculate either for itself or for its clients.
The purchase by a bank — or other financial institution — of physical goods (raw materials, foodstuffs, land, and real estate) or a financial product (shares, bonds, or any other) with the intention to speculate on its price would be prohibited.
8) Who should assume bank losses?
a) Assets. The unlimited responsibility of big shareholders must be reinstated. In case of bankruptcy or liquidation, the cost must be paid for by seizing the assets of the major shareholders (natural persons and companies/moral persons).Globally, small investors/savers must be fully protected (up to say €300,000 (I am proposing this figure as a basis of discussion)). According to Thomas Piketty, in several European countries comparable to France, the 50% least wealthy have an average wealth of €20,000, but many of these households have no wealth or are in debt. [15] The wealthiest 40% possess an average wealth of €175,000 (€100,000 to €400,000). Therefore, the vast majority of people, that is, around 80%, possess less than €300,000. Therefore, the above proposition would fully protect 80% of the population.
b). Deposits. The Copernic Foundation proposes that “In case of bankruptcy, bank customers must continue to enjoy national guarantees Guarantees Acts that provide a creditor with security in complement to the debtor’s commitment. A distinction is made between real guarantees (lien, pledge, mortgage, prior charge) and personal guarantees (surety, aval, letter of intent, independent guarantee). on their deposits, limited to a reasonable ’savings’ balance Balance End of year statement of a company’s assets (what the company possesses) and liabilities (what it owes). In other words, the assets provide information about how the funds collected by the company have been used; and the liabilities, about the origins of those funds. of an upper-middle class household (about €150,000)” [16]. This proposition should also be debated democratically.
9) Require banks to radically increase their equity Equity The capital put into an enterprise by the shareholders. Not to be confused with ’hard capital’ or ’unsecured debt’. -to-assets ratio. [17] Whereas this ratio is generally below 5%, we are for increasing it to 20%.
10) Prohibit Over the Counter (OTC OTC
Over-the-Counter market
An over-the-counter or off-exchange market is an unregulated market on which transactions are made directly between the seller and the purchaser, as opposed to a so-called organized or regulated market where there is a regulatory authority, such as a stock exchange.
) trading Market activities
Buying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit.
All financial market Financial market The market for long-term capital. It comprises a primary market, where new issues are sold, and a secondary market, where existing securities are traded. Aside from the regulated markets, there are over-the-counter markets which are not required to meet minimum conditions. transactions should be registered, traceable, supervised, and controlled. Currently, all the major markets, such as currency markets ($5,300 billion a day) [18], derivatives markets, and commodities Commodities The goods exchanged on the commodities market, traditionally raw materials such as metals and fuels, and cereals. markets [19] are OTC and escape from any control.
11) Put an end to banking secrecy. Banks must furnish all information necessary about their directors, subsidiaries, branches, customers, activities, and the business they handle for themselves and for their customers. Their accounts must be transparent and coherent. The lifting of bank secrecy must become a minimal democratic imperative in all countries. To that effect, banks must provide fiscal authorities with the following information on request: lists of persons who earn interest, make dividends and capital gains, or other financial revenues; the opening, closing, and modification of accounts in order to establish national registers of bank accounts; all inward and outward capital flows, with identification of the beneficiary.
12) Prohibit transactions with tax havens. All transactions with tax havens are to be prohibited. The penalty for violating this restriction should be very heavy – revocation of banking license and heavy fines.
13) Prohibit high frequency trading and shadow banking. Strictly limit what may be retained “off-balance sheet”. [20] Prohibit short selling and naked short selling.
14) Working conditions and hours, pay, and employment.
Guarantee the working conditions and the number of jobs in the banking sector. Implement gender equality including in pay scales. Create a pay scale that increases the lowest wages and puts a limit on the highest. Plato’s recommendation, limiting the highest incomes to four times the lowest could be applied, or the one by Aristotle, who preferred to set the upper limit of income at five times the lowest. [21] This clearly means a radical reduction in the level of highest authorised incomes (fixed salaries, and other income advantages) applied to the top executives. [22]
Non-fixed incomes indexed on sales figures and other bonuses that encourage bad advising and mismanagement must be abandoned in favour of fixed incomes. In addition, the reduction of working hours recommended further on must evidently be applied to the banking sector, so that new jobs will be created.
“Benchmarking” [23] and “Lean Management” [24] must also be prohibited.
15) Prohibit the transfer of the losses of banks and other private financial institutions to the public sector. Public authorities cannot be permitted to transfer private losses to the public sector.
16) Systematically prosecute directors guilty of financial and other crimes. Cancel the banking licenses of institutions that try to override restrictions and misappropriate funds.
17) Tax the banks. Bank profits must be strictly subjected to the normal framework for taxing corporate profits. The current tax rate paid by banks is very much inferior to the usual corporate tax rates, which are themselves insufficient. Currency and financial securities Financial securities Financial securities include equity securities issued by companies in the form of shares (shares, holdings, investment certificates, etc.), debt securities, excluding commercial instruments and savings certificates (bonds and similar securities), and holdings or shares in Undertakings for Collective Investment in Transferable Securities (UCITS). transactions must be taxed. Short-term bank debts must also be taxed in order to encourage long-term investment.
18) Save the banks in another way. In addition to the three measures mentioned above: unlimited responsibility of the biggest shareholders, guaranteed deposits up to €150,000, and prohibiting the transformation of private banking debt into public debt, a well-ordered liquidation process made up of two structures must be put into place. A private “bad bank” (at the cost of the owners, with no cost to public authorities), and a public bank to which all the deposits and remaining safe assets will be transferred. Some recent experiences, such as Iceland’s since 2008, may serve as a source of inspiration.
19) Existing public banks must be strengthened and new ones created where banks have been privatised (of course, under the same strict control mentioned above). A collective was created in France in 2012 for a “Public Finance Accountability Unit.” [25] In Belgium, a website created by PTB is dedicated to promoting awareness of the necessity of a public banking structure. (in French or Dutch) In Belgium, where the government privatised the last public banks during the 1990s, the State has taken over the banking activities of Dexia by acquiring 100% of its stock at a cost of €4 billion, a price that the European Commission itself considered to be absolutely excessive. “Dexia Bank” has been renamed “Belfius” and remains a private company. Belfius must become a public Bank, and the above measures must be applied. Belfius should have been set up without cost to public finances as a public financial institution to take over the deposits of Dexia customers and the safe assets and placed under citizen control. The jobs, working conditions, and wages of the personnel should have been guaranteed while the remunerations of the directors and other board members should have been seriously reduced. They should have been prohibited from managing other private financial institutions. The directors of Dexia should have been prosecuted by the authorities and held to account for the different infractions they had committed.
The application of these nineteen concrete measures would be an advance in banking reform even if the private banking sector would remain in the dominant position. Recent experience shows that we cannot have confidence in Capitalists to own and run banks. If, through a popular movement, we can gain application of the above measures (which are of course open to improvement and completion) the capitalists will still look for any possible ways to take back the lost ground, they will multiply their efforts to find ways around the rules, they will use all the powers at their disposal to win lawmakers and government officials over to the cause of a new deregulation of the banking and financial sectors to once again maximise their profits without taking account of the interests of most people.

II. Socialising the banking sector with citizen control

There are a number of compelling reasons to socialize the banking sector. First of all, Capitalists have repeatedly shown the crimes they are capable of perpetrating and the risks they are ready to take just to increase their profits, without ever facing the consequences. In addition, their irresponsible behaviour regularly results in a heavy burden on society. Third, the society we want to build together must be geared to the common good, social justice, and the restoration of fair relationships among humans and between humans and other parts of nature. What we are trying to achieve is a “complete deprivatisation of the banking sector.” [26]

Socialising the banking sector means:
- expropriating without compensation (or with a symbolic compensation) assets of the major shareholders (small shareholders will be compensated);
- granting the public sector a monopole on banking activities with one exception, a small-size cooperative banking sector (complying with the same rules as the public sector);
- creating a public service for savings, loans, and investments, which will be organised in a network of small branches;
- defining a charter of goals to be achieved and missions to be fulfilled (with citizen participation in debates and decisions);
- enforcing transparency in accounts that must be submitted publicly in a way that is easy to understand.

We use the term “socialisation” rather than “nationalisation” to indicate how crucial citizen monitoring is and the sharing of decision making among executives, representatives of the employees, of the clients/users, of associations, of local MPs and of national and regional banking institutions. We must democratically define how active citizen control can be implemented. Similarly, we must promote the close monitoring of banking activities by employees in the banking sector as well as their active involvement in deciding what has to be done and how. The boards of banks must account for their management on a yearly basis. We must place the priority on high-quality local services, which would be contrary to the current externalizing policies. Employees in financial institutions should be encouraged to provide genuine advice, and move away from an aggressive sales approach, which amounts to forcing people to buy financial products they don’t need.

Socialising the banking sector and integrating it into public services will make it possible to:
- free citizens and governments from the grip of financial markets;
- to finance projects proposed by citizens and public bodies;
- to dedicate the banking activity to common welfare including the task of facilitating transition from a productivist capitalist economy to a social and environmental economy.
As Patrick Saurin rightly observes, “The time has come to no longer socialise bank losses, but banks themselves, lock, stock and barrel.” [27]

III. Socialising the insurance sector and making it a public service

Considering how interdependent the banking and insurance sectors have become within the mammoth universal banks that have developed, considering too that large insurance groups are as irresponsible in their decisions as banks while being even less accountable, it is also necessary to socialize the private insurance sector. Let us remember that according to the programme drafted by the Conseil national de la Résistance (National Council of the Resistance) French insurance companies were nationalized in April 1946 after large banks were nationalized at the end of 1945.

IV. Other measures to be taken for a recovery that is favourable to the overwhelming majority of people

Reducing the public deficit is not an end in itself. Indeed, in some circumstances, the deficit can be used to stimulate economic activity and invest in improving the living conditions of those who are suffering from the crisis. Once the economy has recovered, public deficits must be reduced, but not through cuts in social expenditure, rather through an increase in tax revenue by fighting tax evasion, imposing higher rates of taxation on the profits of major companies, and on the income and assets of rich households, as well as by taxing financial transactions. In any case, it is definitely possible to increase tax revenues while decreasing the tax burden on the poorest 50% of the population.

To reduce the deficit, we must also radically reduce the expenses resulting from repaying the public debt, particularly the portion that is illegitimate, unsustainable, odious, and illegal must be cancelled. Expenses that have to be cut are those related to the army and other socially useless and environmentally dangerous expenses such as building new airports or new motorways.

On the other hand, it is essential to increase social expenses, especially to counter the consequences of the economic depression. We must also increase investments in renewable energies and in some infrastructure, such as public transport, schools, and hospitals. Stimulating the economy through public demand and through the demand generated by the majority of households also results in more tax revenues.

Beyond stimulating employment and the economy, the crisis must be an opportunity to break with the capitalist mindset and radically change society. The new way of thinking to invent must move away from productivism, integrate respect for the environment, do away with all forms of oppression, and promote the common good.

To accomplish these goals, we have to organise a massive movement against austerity, both locally and internationally to bring together the energies needed to tip the balance of power in favour of such radical changes centred on social and environmental justice.

V. Stopping the austerity measures that are unfair and making the crisis worse

Putting an end to antisocial austerity measures is an absolute priority. Through street mobilization, strikes, and by refusing to pay unpopular taxes, we must force governments to cancel austerity policies.

VI. Cancelling illegitimate, unsustainable, odious, and illegal public debts

Citizen audits that are in progress in several countries [28] have resulted in rich and stimulating debates that clarify what may be defined as public debts that do not have to be repaid. Without claiming to be exhaustive, we can propose the following definitions:
a. Illegitimate public debt: debt that was contracted by a government without considering the public interest or undermining the general interest.
b. Illegal debt: debt contracted in violation of the current legal or constitutional system.
c. Odious public debt: loans to authoritarian regimes or granted on conditions that violate the social, economic, cultural, civic, and political rights of the people concerned.
d. Unsustainable public debt: debt that can only be paid back with dire consequences for the people such as a dramatic degradation of its living conditions, of health care and education, an increase in unemployment, or even starvation. In short, debt that undermines basic human rights. In other words, debt whose repayment makes it impossible for governments to provide basic human rights.

A citizens audit of public debt with citizen control, combined with in some cases a unilateral, sovereign refusal to continue repaying the public debt, will make it possible to cancel / repudiate the illegitimate, odious, unbearable and illegal portion of public debt and to greatly decrease the rest.

Public debt that results from bailing out banks is clearly illegitimate debt. In some countries, it may even be illegal. It can be unsustainable as is the case in Greece, Cyprus, and Ireland.

The debts claimed by the Troika Troika Troika: IMF, European Commission and European Central Bank, which together impose austerity measures through the conditions tied to loans to countries in difficulty.

from Greece, Portugal, Ireland, and Cyprus are illegitimate (they go against the general interest), odious (they entail the infringement of contractual relations, and of economic and social rights), unsustainable (considering the dramatic deterioration of the living conditions of a significant part of the population), and in some cases illegal (as is the case in Greece where the constitution was violated because of the pressure exerted by the Troika with the collusion of the Greek government).

Why should public debt be reduced? Why should our indebted governments radically reduce their public debt by cancelling their illegitimate debts? First, on account of social justice, but also on economic grounds that everybody can understand.
To move beyond the crisis in a way that meets the legitimate expectations of people, we cannot content ourselves with stimulating economic activity through public demand and the demand of households. If we do, even with the added tax revenues, repayment of public debt would very largely absorb any surplus. What the richer households and big private companies would pay as taxes would be compensated for by the return they get from public bonds of which they are the main shareholders (which is why they fiercely resist the notion of debt cancellation). Therefore, a large portion of public debt must be cancelled.

The extent of the cancellation will depend on the specific features of the debt in each country and the level of consciousness of the people (in this respect citizen audits play a major role), as well as the way the economic and political crisis develops, and especially the power relations that will evolved according to the mobilisations everywhere now and in the future. In some countries, such as Greece, Portugal, Ireland, Spain, and Cyprus, the issue of debt cancellation is urgent. In countries such as Germany, the Netherlands, France, Belgium, Austria, the United Kingdom, and the United States, the issue is not yet such an urgent matter. Nevertheless, eventually, most countries will have to face the unsustainable nature of debt repayment.

Suspending payment. For countries that have already been blackmailed by speculators, the IMF IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.
and other bodies such as the EC, it is necessary to call for a unilateral moratorium on debt repayment. This proposal has become quite popular in the countries that are the most severely affected by the crisis. Such a unilateral moratorium must be combined with a citizen audit of government borrowing, which should bring up evidence and arguments to repudiate the part of the debt that has been identified as illegitimate. As shown by the CADTM in several publications, international and national law provide a basis for such a unilateral, sovereign decision. [29]

Refusing debt relief conditioned by antisocial measures imposed by creditors. We cannot support debt relief as decided by creditors because of the heavy counterparts they involve. The reduction plan for part of the Greek debt that has been implemented since March 2012 is conditioned on the country enforcing more measures that infringe the Greek people’s economic and social rights as well as the country’s sovereignty. [30] The aim is actually to make it possible for foreign private banks (mainly in France and Germany) to cut their losses, for Greek private banks to receive fresh money from the Treasury, and for the Troika to comfort its hold on Greece. While the Greek public debt amounted to 130% of the country’s GDP GDP
Gross Domestic Product
Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another.
in 2009 and 157% in 2012 after a partial cancellation of the debt, it reached 175% in 2013! We must thus expose the fraud of the reduction of the Greek debt as it was implemented and oppose our alternative: cancellation of the debt (i.e. its repudiation by the indebted country), which is a legitimate act of unilateral sovereignty.

Auditing makes it possible to identify who is responsible for odious, unsustainable, illegitimate, and illegal debts. Citizen audits make it possible to determine the responsibilities in the process of contracting debts, and thus to demand that those who are accountable (whether at the national or international level) be held accountable for their acts. If audits bring up illegal actions related to illegitimate debts, their perpetrators (whether natural or legal persons) must be convicted and made to pay compensations, they should be banned from any jobs related to credit institutions (banks could have their banking licences withdrawn), and must not be exonerated from prison sentences if the gravity of their acts merits such punishment. We must introduce legal action against public authorities that contracted illegitimate debts.

Who will pay the bill for debt cancellation? It is in any case logical that the private institutions and the rich who hold debt securities bear the burden of cancelling illegitimate sovereign debt Sovereign debt Government debts or debts guaranteed by the government. since they are largely responsible for the ongoing crisis and have actually profited from it. Making them pay is only a small step toward more social justice.
It is thus important to identify security holders in order to compensate those who are low or middle-income citizens. The way to identify debt security holders is to stop paying, since they will then have to come out and claim repayment. That will help the State to compensate small holders of public debt securities. Let us add that “When public debts are cancelled, small savers who have invested in public securities as well as wage earners and old-age pensioners who had part of their social security contributions (old-age, unemployment, healthcare or family benefits) invested in institutions or bodies that run the same kind of securities can very well be protected. [31] The portion of public debt that has been identified as legitimate will have to be reduced by asking for help from those who benefited from it. One way to make sure they pay the cost of the operation is to levy an exceptional progressive tax on the top 10% of accumulated wealth. The revenues from this tax could be used to anticipate repayment of that part of the debt that has been established as legitimate. There are other possibilities open to debate.

Additional measures for handling debt. The portion of the national budget spent to repay public debt must be capped according to the country’s economic capacities, the public authorities’ ability to repay, and the inelastic nature social expenditure. We should learn from what was done for Germany after WWII: the 1953 London agreement included a 62% reduction of the German debt stock Debt stock The total amount of debt and stipulated that the debt/export ratio should not exceed 5%. [32] We could define a similar ratio: the amount dedicated to repay the debt should not be more than 5% of a State’s revenues.

We must also set up a legal framework to avoid the repetition of the crisis that started in 2007-2008. It must be prohibited to socialise private debt, and there must be an obligation to organise a permanent audit of the public debt policy with citizen participation. The statutory limitation for crimes related to illegitimate debt must be abrogated, and illegitimate debt must be considered null and void. In addition, a golden rule must be adopted according to which public spending for fundamental human rights cannot be cut, and have priority over spending to repay debt. There are clearly plenty of alternatives.

VII. Cancelling illegitimate and illegal private debt

At the international scale, in a context of real estate speculation in which they played a driving role, private banks massively abused millions of households with mortgages. When the bubble burst and payment defaulting multiplied they seized the mortgaged properties and evicted the inhabitants. This happened in the USA, Spain, Ireland, Iceland, and several Eastern and Central European countries. We have to cancel illegitimate or even illegal debt, which has consequences on at least hundreds of thousands of households, and attempt to prevent foreclosures.
Banks and private universities have swindled hundreds of thousands of students as they imposed intolerable and illegitimate debts. Let us remember that student loans in the US amount to some $1,000 billion. These student-loan debts must also be cancelled.

VIII. Increase resources for public authorities and reduce inequalities through fair taxation

Direct taxes on the highest incomes and on major corporations have decreased continually since 1980. These hundreds of billions of euros in fiscal gifts have essentially been oriented towards speculation and the accumulation of wealth by the richest segment of the population. Since 1975-1980, the trend has been towards an increase in inequalities, with the wealthiest 1% and 10% strongly increasing the share Share A unit of ownership interest in a corporation or financial asset, representing one part of the total capital stock. Its owner (a shareholder) is entitled to receive an equal distribution of any profits distributed (a dividend) and to attend shareholder meetings. of overall wealth they control.
In 2010, in Europe, the wealthiest 1% possessed 25% of the total wealth. This corresponds more or less to the capitalist class, and an impressive share of the wealth is concentrated there. If we extend the study to the wealthiest 10%, we find that 60% of the total wealth is in the hands of that minority. We can assume that the additional 9% represents the entourage or the allies, in the broad sense, of the capitalist class. The remaining 90%, then, must be content with 40% of the total wealth, and among these 90%, the poorest 50% own but 5% of the wealth. [33]
What has just been said about the European Union can be extended to the rest of the world; from the North to the South of the planet, we have witnessed an impressive increase in the share of the wealth held by the wealthiest fraction.
We could extend the study to an even more infinitesimal minority: The wealthiest 1/20,000,000 of the adult population at the planetary level in 1987 was made up of 150 persons, each of them with an average of $1.5 billion. Sixteen years later, in 2013, the wealthiest 1/20,000,000 numbered 225 persons, each of them with an average wealth of $15 billion – a growth of 6.4% per year. [34] The wealthiest 0.1% (one thousandth of the global population) owns 20% of the world’s wealth, and the wealthiest 1% 50%. If we take the wealth of the richest 10% into consideration, Thomas Piketty estimates that it represents 80 to 90% of the world’s total wealth, with the least wealthy 50% owning less than 5%. That gives us an idea of the effort towards redistribution that needs to be made. Such a redistribution requires confiscating a large share of the wealth held by the richest fragment of the population.

Let us return to Europe. A profound reform of taxation aimed at achieving greater social justice (reducing the revenue and the wealth of the wealthiest segment to increase that of the majority of the population) must be combined with a harmonisation of the effort at the European level in order to prevent fiscal dumping. [35] The goal is to increase public funds, including via a progressive income tax on the revenue of the wealthiest physical persons (the marginal income tax rate can very well be increased to 90%, or even 100% [36]), a tax on wealth above a certain amount, and corporate tax.

The gross domestic product of the European Union in 2013 was approximately €14,700 billion. The total private wealth of European households is approximately €70,000 billion. The wealthiest 1% alone possesses roughly €17,500 billion (25% of €70,000 billion). The next-wealthiest 9% hold €24,500 billion (35%). The 40% in the middle hold €24,500 billion (35%). The remaining 50% own €3,500 billion (5%).
The annual budget of the European Commission is approximately 1% of the EU’s GDP. That means that an annual tax of 1% on the wealth held by the wealthiest 1% in the EU would provide €175 billion – more than the current budget of the EU, which is approximately €145 billion. What about a tax of 5%? This gives an idea of what is potentially achievable if social mobilization were to bring about a radical change of policy at the European level, or even at the level of a single EU country.
An exceptional tax (levied once in a generation) of 33% on the holdings of the wealthiest 1% in the EU would yield Yield The income return on an investment. This refers to the interest or dividends received from a security and is usually expressed annually as a percentage based on the investment’s cost, its current market value or its face value. nearly €6,000 billion (40 times the annual budget of the EU!) How about a confiscatory rate of 80%?
These figures give an idea of what is at stake when considering the issue of taxation of the private wealth of capitalists and the possibilities that arise for developing proposals for using that money in the service of social justice.
Many economists endlessly repeat the idea that there is no point in taxing the wealthiest people because there are so few of them that the yield would not really be that high. However, over time, the wealthiest 1% have concentrated such large quantities of tangible and intangible assets that a policy targeting the wealthiest 1% or 2.5% (or perhaps the wealthiest 10%) would provide substantial means for breaking with neoliberalism.
To those who claim that wealth is inaccessible, because it can cross borders easily, we must respond that sequestration, the freezing of financial assets, heavy fines, and the control of capital movements are powerful tools that can be readily used against the banks that collude in the flight of capital. [37]

This increase in revenue must be accompanied by a rapid decrease in the cost of access to fundamental goods and services (basic food items, water, electricity, heating, public transport, school supplies, etc.), for example through a sharp and targeted reduction of the VAT on these vital goods and services. Similarly, exemptions from real-estate taxes on residences must be applied to immediately lighten the tax burden on the least wealthy 60 or 70% of the population.
Another need is for a tax policy that encourages protection of the environment via dissuasive taxation of polluting industries.

IX. Legitimate public borrowing

A State must be able to borrow money in order to improve the living conditions of its people, for instance, to finance public utility works. Some of this work may be funded by the current budget if the right policy choices are made. However, government borrowing may be necessary to finance large-scale projects, such as public transport networks that would provide an environmentally friendly alternative to road transport. Or it could be used to replace nuclear power stations with clean alternative sources of energy production, create or reopen local railway lines throughout the country, especially in urban or suburban areas, construct and renovate public buildings and public housing, while making them more energy efficient and of high quality.
New standards of transparency in public borrowing must be defined: 1) loans must go towards improving living conditions, while breaking away from imperatives that harm the environment; 2) the use of borrowing must contribute to a programme of wealth redistribution so as to reduce inequality. Financial institutions, major corporations, and wealthy households must be obliged, by legal means, to purchase State issued, non-indexed, bonds at 0% interest in an amount proportional to their overall wealth. Other savers would be offered State-guaranteed, public bonds indexed at 3% above inflation Inflation The cumulated rise of prices as a whole (e.g. a rise in the price of petroleum, eventually leading to a rise in salaries, then to the rise of other prices, etc.). Inflation implies a fall in the value of money since, as time goes by, larger sums are required to purchase particular items. This is the reason why corporate-driven policies seek to keep inflation down. . Thus, if a country’s annual inflation rate were 3%, the bonds would have a nominal yearly interest rate of 6%.
This sort of positive discrimination (similar to what is practised in the US in the struggle against racial oppression, in India in favour of the lowest castes, or to advance gender equality) would permit advances towards greater tax justice and a more equitable sharing of the wealth.
In addition, the central banks and the ECB ECB
European Central Bank
The European Central Bank is a European institution based in Frankfurt, founded in 1998, to which the countries of the Eurozone have transferred their monetary powers. Its official role is to ensure price stability by combating inflation within that Zone. Its three decision-making organs (the Executive Board, the Governing Council and the General Council) are composed of governors of the central banks of the member states and/or recognized specialists. According to its statutes, it is politically ‘independent’ but it is directly influenced by the world of finance.
(in the eurozone countries) must provide funding for State budgets at a rate of interest close to 0%.

X. Develop public services

The development of public services during the 20th century, until the neoliberal turnaround of the 1980s, was a great step forward for society and social progress. What remains today must be protected, sectors that have been privatised should be de-privatised, and the public/collective service model extended to new sectors. Education, health, public transport, telecommunications, internet, radio and television, postal services, water works, rubbish collection and processing, local healthcare services, local and regional administrative services, fire services, and civil protection are sectors in which public services should have a monopoly or play a dominant role. We support the extension of public/collective service structures to banking and insurance. We also include the energy sector in that list, because this would be essential for ensuring the ecological transition.
The public services must be allocated sufficient funding to ensure their mission and to remunerate their staff correctly. Wages, personnel rights, job security, and working conditions must be improved. Citizen control is an essential ingredient for higher quality services.

XI. Strengthen public pension schemes

Another fundamental victory in the 20th century was the creation of a universal and obligatory public pension scheme. These structures must be strengthened progressively to become fully comprehensive and replace the private sector. We must refuse any increase in the legal retirement age. This is definitely feasible through a general reduction in working hours, and the corresponding increase in the work force (including public service jobs) and thus the number of workers contributing to the pension scheme.

XII. Radically reduce working hours to guarantee full employment while adopting a wage policy that favours social justice

Sharing the wealth more equitably is the best answer to the crisis. The portion of the wealth going to employees has been seriously reduced over the last few decades, while the financiers and corporations have increased their profits and used them to speculate. Increased wages permit wage earners to live better, and at the same time the resources available used to implement social policies and retirement schemes are strengthened.
Reducing working hours without reducing wages, but creating the corresponding number of jobs improves living conditions and opens up positions to be filled by others. Substantial reductions in working hours also permit other lifestyle choices than the consumer society, and a breaking away from purely mercantile social relationships. The free time created would allow more people to take part in political, social, and volunteer activities, as well as cultural creativity, “products of great necessity” as a group of West Indian intellectuals called them in a 2009 platform. In fact, a new mindset is needed to replace the rampant alienation and objectification of the free market society.
Minimum and average wage levels and benefits must also be significantly raised. On the other hand, maximum incomes must also be imposed on company directors who receive unacceptably high remunerations, both in the public and private sectors. Stock options, excessive bonuses and retirement advantages, as well as other abusive gains must be made illegal. A maximum income must be created. As indicated above, we recommend a maximum revenue differential of 1 to 4, taking into account all of a person’s revenues, which would then be subject to taxation.

XIII. Reconsider the euro

It is absolutely necessary for some countries such as Greece to reconsider their adhesion to the euro. It is clear that it is a straightjacket for Cyprus, Greece, Ireland, Portugal, and up to point for, Spain. If we do not give the question the same attention here as other alternative propositions, it is because this is an overarching debate that tends to be divisive within social movements and left-wing political parties. It is indeed a major question that would require a lengthy discussion to be dealt with adequately. As Costas Lapavitsas has remarked, [38] if countries want to drop the euro, they have the choice of going left or right. Our major preoccupation is to unite as many people as possible around the vital issues mentioned above. In particular, we must advance solutions concerning banks and the debt, and leave the divisive questions for subsequent debate.

XIV. An alternative Europe: a real democratic constitutional process must replace the current treaties

Several clauses in EU, Eurozone and ECB treaties must be abrogated. For example, articles 63 and 125 in the Treaty of Lisbon, prohibiting all controls of capital movements and all aid to member states in difficulty. The Stability and Growth Pact, and the European Stability Mechanism ESM
European Stability Mechanism
The European Stability Mechanism is a European entity for managing the financial crisis in the Eurozone. In 2012, it replaced the European Financial Stability Facility and the European Financial Stabilisation Mechanism, which had been implemented in response to the public-debt crisis in the Eurozone. It concerns only EU member States that are part of the Eurozone. If there is a threat to the stability of the Eurozone, this European financial institution is supposed to grant financial ‘assistance’ (loans) to a country or countries in difficulty. There are strict conditions to this assistance.
(ESM) must also be suppressed.
Monetary policy and the status and practices of the ECB must be completely overhauled. The governments and the EU, which created the ECB, have armed themselves with a new tool for destroying social and democratic rights.
The central banks and the ECB must be authorised to directly finance States seeking support for social and environmental programmes that are perfectly adapted to satisfying the fundamental needs of their peoples.
The current treaties must be abrogated and replaced by new treaties built within the framework of a truly democratic constitutional process. This action presupposes the election, by universal suffrage, of a Constituent assembly followed by a referendum to accept the constitutional proposition, which would create a pact of solidarity between the peoples for more democracy, better jobs, and an ecological transition.
A Europe built on solidarity and cooperation would be able to turn its back on the oppressive competition dragging it down. The cause of the crisis, neoliberal policies have failed miserably. They have pushed down social indicators, sliced away social rights, employment, and public services. The handful of people who have benefited the most from the crisis have done so by riding roughshod over the rights of the majority of others. The felons have won and the victims must pay the bill! This way of thinking, which underlies all the basic EU treaties, must be discredited. An alternative Europe, based on cooperation between States and solidarity between the peoples, must become the priority.
Global policies at the European level, financed by massive public investment to create public jobs in essential sectors (local services, clean and renewable energy, protection of the environment, and the provision of basic social necessities) must be imposed. The creation of a new political system would require a project coordinated by the people to draft a new Constitution framing a very different Europe
This new democratic Europe must strive to impose non-negotiable principles: tax and social justice, gender equality, decisions aimed at improving the quality of life, disarmament and serious reduction of military spending, durable energy options without nuclear power, a serious reduction in greenhouse gas emissions, and the prohibition of GMOs. Europe must also put an end to its besieged fortress policies vis-à-vis immigration to become a true ally and partner of the countries and peoples of the global South. The first step should be the unconditional abolition of Third World debt. The abolition of debt is the common denominator of the struggles in the North and South. A new Europe must emerge that will entirely rethink its attitude and relations with the rest of the World by returning to the peoples of the other continents what was pillaged and stolen from them through centuries of European domination.
These propositions will not become reality unless the peoples of Europe get mobilised, rise up, and through their own self-driven activities and organisations become the actors of their own emancipation.

Translated by Snake Arbusto, Mike Krolikowski, Charles La Via, and Christine Pagnoulle

Eric Toussaint is a historian and political scientist who completed his Ph.D. at the universities of Paris VIII and Liège. He is the President of CADTM Belgium (, and sits on the Scientific Council of ATTAC France. He is the author of many essays including Procès d’un homme exemplaire (The Life and Crimes of an Exemplary Man), 2013, and wrote with Damien Millet, AAA. Audit Annulation Autre politique (Audit, Abolition, Alternative Politics), 2012. He is the co-author, with Damien Millet,Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers, Monthly Review Books, New York, 2010; The Debt Crisis: From Europe to Where?, VAK, 2013, Mumbai (India).
See Series “Banks versus the People: the Underside of a Rigged Game!” .His latest book Bankocracy will be published in May 2014 by Aden in French and later by Merlin Press.


[1The “International Covenant on Economic, Social and Cultural Rights” was adopted in New York on 16 December 1966 by the United Nations General Assembly in its resolution 2 200 A (XXI). It came into force on 3 January 1976. See the full text of the covenant and list of countries that signed it at: Read a brief presentation:,_Social_and_Cultural_Rights

[2See the report “Safegarding human rights in time of economic crises” by Nils Muiznieks, Commissioner for Human Rights for the Council of Europe (published on 3 December 2013): “What began as a meltdown of the global financial system in 2008 has been transformed into a new political reality of austerity which threatens over six decades of social solidarity and expanding human rights protection across Council of Europe member states. … Many of these austerity measures – characterised by public expenditure cuts, regressive tax hikes, reduced labour protection and pension reforms – have exacerbated the already severe human consequences of the economic crisis marked by record levels of unemployment. The whole spectrum of human rights has been affected – from the rights to decent work, an adequate standard of living and social security to access to justice, freedom of expression and the rights to participation, transparency and accountability.”

[3The International Covenant on Civil and Political Rights was adopted in New York on 16 December 1966 by the General Assembly of the United Nations in resolution 2200 A (XXI). This Covenant came into force on 23 March 1976. Read the full text at:

[4The European Commission, ECB, and IMF.

[5This was clearly the case in Greece in 2010, when the Troika imposed its structural adjustment programme. Another example is the unconstitutional decision made by the Belgian government to grant a more than de €50 billion guarantee to Dexia Bank in October 2011. The Belgian government adopted the measure by means of a simple royal decree, whereas the Belgian constitution and laws stipulate that this kind of action must be decided on by the legislative body.

[6The banking sector should be entirely public, except for a small cooperative sector with which it could coexist and collaborate.

[7Philippe Lamberts, (MEP Green Party), suggests a maximum of $100 billion dollars in assets. “In comparison, the total assets of BNP Paribas and Deutsche Bank in 2011 were €2,164 billion and €1,965 billion.” I think the maximum size should be much smaller, in particular for banks domiciled in small countries. €100 billion is several times the GPD of Cyprus, and more than a quarter that of Belgium.

[8This is to resuscitate Glass Steagall type laws adopted in the US starting in 1933.

[10This was part of the Glass Steagall Act already mentioned.

[11This is my proposition.

[12For the Copernic Foundation, it is “Just as important to stop them (investment banks) from taking inconsiderate risks (for themselves and for local authorities) as it is to prevent these risks from being transmitted. The same authorities should have the power of pre-commercial examinations of the new, sometimes exotic, financial products and to prohibit operations that are not very well understood even by the financiers themselves or speculative interventions on public debt (CDS markets, National bond futures, and securitisation), commodities and foodstuffs. The granting of a commercialisation license presupposes the competence of the supervisors to understand banking innovations and in case of doubt have the capacity to refuse them” June 2012.

[14Paul Jorion in Financité, November 2013. Elsewhere, Paul Jorion makes reference to two articles of French criminal law, prohibiting speculation, that were abrogated in 1885 under the influence of the business sector. According to article 421, “Speculation on the rise or fall in the prices of government securities will be punished by imprisonment for not less than one month and not exceeding one year.” Article 422 specifies that: “Will be considered to be speculation of this kind, any agreement to sell or supply government securities that sellers cannot establish to have had in their possession at the time of the agreement or that should have been in their possession at the time of delivery.”, Paul Jorion also mentions article 1965 of the “Code Civil” that states “The law makes no provision to incriminate the payment of gaming debts or of wagers.” This measure is in harmony with article 138 of the royal decree by Louis XIII dated 15 January 1629, known as the “Code Michau”, which says: “We declare that all gaming debts are non-existent, and all guarantees and promises on gaming, in whatever form they may take are null and void, and devoid of any civil or natural obligations.”

[15According to a report by ING Bank, 3 Belgians out of ten 10 have no savings. 30 January 2014, (in French).

[16Fondation Copernic (2012), «Changer vraiment Quelles politiques économiques de gauche?», (junio).

[17That requires eliminating the risk weighted assets system.

[18See Eric Toussaint, « Comment les grandes banques manipulent le marché des devises »(“How the big banks manipulate the currency markets”), published in Le 13 March 2014 and available here (in French, Spanish, and Portuguese)

[19Eric Toussaint, “Banks speculate on raw materials and food,” 7 March 2014

[20For example, restrict the off-balance sheet to guarantees and signature engagements only. This measure requires further discussion.

[21“Now the legislator should determine what is to be the limit of poverty or wealth. Let the limit of poverty be the value of the lot; this ought to be preserved, and no ruler, nor any one else who aspires after a reputation for virtue, will allow the lot to be impaired in any case. This the legislator gives as a measure, and he will permit a man to acquire double or triple, or as much as four times the amount of this”. Plato, The Laws, V, 744 d - 744 e in Works by Plato, Aristotle treats the question in Politics, Book 2, chap III § 8 et chap IV § 3 referring to Phaleas and Plato, See . Philippe Lamberts proposes an upper limit of remuneration (salary + bonuses) of 10 times the average of the lowest incomes, While the union “Sud BPCE” proposes to eliminate bonuses, stock-options, retirement compensations and other unjustified advantages and exceptional practises while installing an MAI (Maximum Authorised Income).

[22Should corporations exceed this limit the revenue would be taxed at 100%.

[23Benchmarking :Is a marketing method of studying, analysing and comparing the production, management and organisation practices of different companies in the same activity so as to appropriate them in order to improve performances. These methods are applied internally to corporations to put different branches, services and employees into continual competition with each other. This has the consequence of seriously deteriorating working conditions. In France, the union Sud BPCE won legal actions against benchmarking . The courts recognised that such practices were “seriously detrimental to employees health” (decision by the Tribunal of Grande Instance of Lyon 9 September 2012, confirmed by a decision of Lyon appeals court 21 February 2014).

[24Lean management : is a method of production management that results from the permanent research for gains in productivity, quality, delays and costs. The expression “lean” is to be associated with “downsizing” which is synonymous to redundancy plans. This headlong race for performance has a very negative effect on workers, causing psycho-social risks and Repetitive Strain Injuries.

[25See: (in French) This collective brings together various public financial institutions (Banque de France, Caisse des Dépôts et ses filiales financières, OSEO, Société des participations de l’État, Banque Postale, UbiFrance, Agence française de développement, Institut d’émission des départements d’Outre-Mer, and CNP Assurance), and institutions that manage a public service (Crédit foncier, Coface). Any bank or insurance company in which the State has a majority holding or to which has been confided a public service mission.

[26Frédéric Lordon, « L’effarante passivité de la « re-régulation financière » » (“The Shocking passivity in ‘financial re-regulation’”, in Changer d’économie (Changing the economy), les économistes atterrés, Les liens qui libèrent, 2011, p. 242.

[27Patrick Saurin, « Socialiser le secteur bancaire » (Socialising the banking sector), 2 February 2013,‎. Also see: Syndicat Sud du groupe bancaire BPCE, Projet bancaire alternatif, June 2012. ou

[28Spain, Portugal, Greece, France, Belgium, Brazil… See the ICAN website:

[29Cécile Lamarque, Renaud Vivien, « Plaidoyer juridique pour la suspension et la répudiation des dettes publiques au Nord et au Sud » (A plea for the suspension and repudiation of public debt in the North and South), 1 June 2011, (in French)
Cécile Lamarque , Renaud Vivien, “How debts can legally be declared void,” 16 May 2011,

[31Thomas Coutrot, Patrick Saurin and Éric Toussaint, “Cancelling debt or taxing capital: why should we choose?”

[32Éric Toussaint, The World Bank: A Critical Primer, Pluto Press, London, 2008, Chapter 4.

[33See Éric Toussaint, “What can we do with what Thomas Piketty teaches us about capital in the twenty-first century?” 19 January 2014,

[34Thomas Piketty, Capital in the Twenty-First Century, p. 692.

[35We could take the example of Ireland, where the tax rate on corporate profits is only 12.5%. In France, the actual tax rate on companies on the CAC 40 index is only 8%.

[36We should point out that the 90% had been applied to the wealthiest individuals beginning with the presidency of Franklin Roosevelt in the United States in the 1930s. In France, it was applied in 1924, then again just before the Second World War.

[37Government can prohibit the banks doing business in a country from conducting any transaction in excess of a certain sum without prior authorisation under penalty of a fine equal to the amount transferred (to which could be added the threat of losing their banking licence). Various measures are definitely possible.

[38Costas Lapavitsas in Cédric Durand (editor), En finir avec l’Europe (Do away with Europe), Paris, La Fabrique, 2013.

Eric Toussaint

is a historian and political scientist who completed his Ph.D. at the universities of Paris VIII and Liège, is the spokesperson of the CADTM International, and sits on the Scientific Council of ATTAC France.
He is the author of Greece 2015: there was an alternative. London: Resistance Books / IIRE / CADTM, 2020 , Debt System (Haymarket books, Chicago, 2019), Bankocracy (2015); The Life and Crimes of an Exemplary Man (2014); Glance in the Rear View Mirror. Neoliberal Ideology From its Origins to the Present, Haymarket books, Chicago, 2012, etc.
See his bibliography:
He co-authored World debt figures 2015 with Pierre Gottiniaux, Daniel Munevar and Antonio Sanabria (2015); and with Damien Millet Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers, Monthly Review Books, New York, 2010. He was the scientific coordinator of the Greek Truth Commission on Public Debt from April 2015 to November 2015.

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