A New Year's 'Declaration': Let's Get Finance Right This Year

By Bob Hockett

With the current 'generation's' opportunity to reform the US health insurance regime now nearly consummated -- and on a not altogether unsuccessful note at that -- perhaps it will not be inapposite to propose another 'let's get it right' resolution for the year ahead. My candidate this year will be this lofty hope:  How about we make 2010 the year in which, among other things (like getting serious about green-friendly energy and ending needless human and other animal suffering), we finally get both our domestic and the international financial systems and their regulation right?  This, at any rate, will be one thing to which I for one will be devoting a fair portion of energy -- as, unless I miss my guess, will be Neil and perhaps even our own polymathic Mike!

There will of course be a great many things to be done, and hence recommended, along these lines; and there will be the same danger of 'moderate'-mollifying half-measures' being settled for here as we've found at work in the health insurance reform efforts. And so DoL readers can expect, I think, a good variety of posts on this large subject in the months ahead. Since the new year is nearly upon us, however, and DoL readers will have better things to do in the next day or so than to read another long boring post from me, I shall close this post with a brief on-point anecdote and associated 'declaration.'

Earlier this month, I presented a paper at an interesting Yale conference hosted by Thomas Pogge, formerly at Columbia with such as Mike and now at Y's Philosophy Department. Although the occasion was now several weeks ago, I find that I'm still marvelling at how very inspiring this conference was. It brought together lawyers, economists, and philosophers not only from the academy, but also from such influential global institutions as the International Monetary Fund and the World Bank, and from such NGOs, 'civil society' organizations, and faith groups as Global Financial Integrity, Amnesty International, Human Rights Watch, the Soros Foundation, the National Council of Churches, Oxfam, and many others.

What was perhaps most profoundly encouraging about this conference was how so many morally committed and energetic people, from so many varied backgrounds and affiliations, were able in a spirit of fraternal concern and committed collaboration to grapple with a very real, very urgent, yet very much 'off the radar' global problem: That is the role played by 'offshore' financial secrecy, money-laundering, tax-dodging 'transfer pricing' schemes, and like practices in hampering sustainable, equitably shared development in many still undeveloped nations, locking the global poor into enduring penury.

Also eye-opening at this conference were a multitude of shocking reports that emerged of the brutal, dehumanizing ways in which laborers, often imported into many of these havens under false pretenses, are treated. And this is not even to mention, though perhaps it is to presuppose, the regard in which these same folk -- many from such places as the Philippines and Bangladesh -- are held by the wealthier 'tax refugees' who reside in the penthouses of these Vegas-like 'outlaw jurisdictions.' For the imported laborers appear to be viewed and routinely described, as well as treated, as less than human by those who import them.

I accordingly think that all lawyers of good will with an interest in financial regulation and tax policy (yep, lawyers like Neil!) might find the subject of this conference a very ripe field in which dramatic improvements in the lives of our innocent fellow human beings worldwide might be made -- if only we will continue to notice.

On that note, then, let me close this post and welcome the new year with the 'New Haven Declaration' upon which all attendees agreed at the close of our conference earlier this month, a declaration upon which we shall be following-up with more action:

New Haven Declaration on Human Rights and Financial Integrity

Human rights and international financial integrity are intimately linked. Where poverty is pervasive, civil, political, and economic rights often go unrealized. Today, large outflows of illicit money -- many times larger than all development assistance -- greatly aggravate poverty and oppression in many developing countries.

 Illicit money leaves poorer countries through a global shadow financial system comprising tax havens, secrecy jurisdictions, disguised corporations, anonymous trust accounts, fake foundations, trade mispricing, and money-laundering techniques. Much of this money is permanently shifted into western economies.

Reducing these illicit outflows requires greater transparency and integrity in the global financial system. Achieving this is a prerequisite to creating an economic framework that is open, accountable, fair, and beneficial for all.

We call upon the United Nations, the G8, G20, WTO, IMF, World Bank, and other international fora, as well as on national governments, world leaders, faith groups and civil society organizations to recognize the linkage between human rights and financial transparency. We further call for decisive steps to ensure that developing countries can retain their resources for sustainable growth and poverty alleviation, which they must achieve if the human rights of all people are to be realized.

The undersigned individuals and organizations shall be working together in the coming months to pursue this agenda and look to add additional voices to this effort.
Happy New Year to all!