The phrase has begun to crop up in the British press: “The Summer of Discontent.” A direct reference to the so-called “winter of discontent” and the social movements that rocked the UK in 1978 and 1979. More than 40,000 railway and London Underground officials staged several 24-hour strikes to denounce the deterioration of their purchasing power in the face of annual inflation of 10% and to demand wage increases. Today, nurses, telecommunications and airport workers, garbage collectors and postal workers have announced their intention to do the same. The education sector is expected to follow suit, with local schools, libraries and swimming pools face budget cuts.
Great Britain is no exception. In Spain, the education sector in Catalonia has been carrying out total and partial strikes since March and the employees of the Post Office are demanding that the cuts in the public company be reversed. Zimbabwean toilets have stopped work to force the government to pay wages in US dollars, as spiraling inflation has eroded purchasing power. In Latin America, Peruvians are the first to take to the streets, but the sharp rise in food and energy prices suggests that social unrest may spread throughout the region. In Sri Lanka, your government has just introduced a four-day week for civil servants to give them time to grow food at home to support themselves. Everywhere, runaway inflation is the final straw after more than two years of the Covid-19 pandemic, which has tested frontline workers.
Hospital workers are on their knees in poor countries, but also in richer ones, after decades of austerity, precarious contracts and privatizations. Many have paid with their lives for the fight against the new coronavirus, and most of them work endless hours without any salary increase or social recognition. And it is women who pay the highest price, since represent 70% of health personnel in the world. In addition, they are the ones who carry out most of the unpaid care work in their own homes, increasing sharply as public services, on the verge of collapse, are unable to fulfill their missions.
inflation is back all over the planet, caused by the pandemic, exacerbated by the war in Ukraine, and proving to be more persistent than major central banks thought. But we are not all the same when it comes to inflation. In the poorest countries it is already causing increased hunger and food insecurity. Even among the rich, low-income households are the first to suffer, as rising food prices weigh more heavily on their consumption baskets than on those of the better-off.
While the world has just commemorated the International Day of Public Administration, the images of hundreds of thousands of civil servants protesting in the streets against the ravages of inflation are a reminder that there are more and more poor workers and those in precarious employment in their ranks, even in the most powerful nations of the world. It is not surprising that in many countries it is impossible to find candidates for positions as nurses, truck drivers or teachers.
To restore citizen trust and rebuild more resilient, inclusive and equal societies, we must radically change course
However, the deterioration of working conditions, the reduction of budgets to public services and the transfer of control to the private sector are not inevitable. The resources to increase wages, hire more people and restore dignity to public administration exist, and they must be found where they are: in the accounts of multinationals and the richest, discreetly housed in tax havens. Since the beginning of the pandemic, the wealth of the ten richest men in the world it’s been duplicated, while the income of 99% of the world’s population has decreased. The health crisis has only deepened an underlying trend: since 1995, the richest 1% have hoarded almost 20 times more wealth than the poorest half of humanity.
That is why it is urgent to rethink international taxation so that multinationals finally pay what corresponds to them. Even the G20, which brings together the 20 richest countries in the world, has been convinced of this, defending an agreement last year to introduce a minimum tax of 15% on the profits of multinationals. The agreement is a step in the right direction, although it is not very ambitious, since it will only generate just over 140,000 million euros of additional tax revenue, which, according to the distribution criteria adopted, will go mainly to rich countries. This figure would rise to more than 475,000 million euros with a rate of 25%, as recommended by the ICRICTthe Independent Commission for the Reform of International Corporate Taxation, of which I am a member.
States also have the option of making the super rich contribute more. A handful of them, the so-called “patriotic millionaires”, are aware of the urgency of doing so. “Put taxes on us, the rich, and let it be now”, they say in an open letter, in which they call for the introduction of “a permanent wealth tax on the richest to help reduce extreme inequality and raise revenue for long-term sustainable increases in public services such as healthcare.” And it can no longer be said that his wealth is untraceable. It only took a few days for the world to find out about the luxury yachts and apartments of the Russian oligarchs close to Vladimir Putin. A similar effort can be made for all the hidden wealth of billionaires from all over the world.
With the inflation crisis, it is impossible to continue avoiding the debate: will the States continue to finance themselves with austerity programs, cuts in public services, raising the retirement age and increasing the contribution of the poorest through consumption taxes inflated by the inflation? This is a recipe for chaos. To restore citizens’ trust and rebuild more resilient, inclusive and equal societies, capable of coping with the existential threat of climate change, we must radically change course and make everyone who has the means, and who currently manages to avoid their tax obligations, contribute more. Otherwise, it is to be expected that the discontent around the world will last much longer than a season.
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