Simon T. Kaye

…or, why Bono shouldn’t pay up.

This week, U2 will be headlining at the Glastonbury festival. As expected, rock music purists are debating whether U2 is just too pop; whether this might be another symptom in the festival’s dumbing-down (Snoop Dogg, Beyonce and Jay-Z being among recent headlining artists).

But the musical discussion has been overshadowed by a political one. Art Uncut, a spin-off from the  UK Uncut protest movement which we heard so much about during the tuition fees arguments of late last year, is staging a demonstration against U2. Not because Bono isn’t rock’n'roll enough, but because he – in their view – is dodging his taxes.

I encourage you to read the 3rd June piece about this on the Art Uncut website. Titled “It’s crucial we send a message to Bono that what he is doing is wrong”,  the piece forwards what is now becoming a very familiar argument: that there is a moral obligation to maximise individual tax contributions.

The ‘Bono Pay Up’ Facebook event page now has around 200 registered participants, all of them (presumably) ticket-holders for the expensive Glastonbury event. Perhaps this seems a little meagre, given that around 177,000 people are set to attend the festival. But the overall power of a moral argument against tax-avoidance has gathered massive support elsewhere, mixed well into a generally politics-flavoured cocktail of state spending cuts opposition and distaste for specific coalition reforms. Protests and sit-ins at Fortnum & Mason, Topshop and the like have attracted news headlines and big-name support from the likes of the Guardian‘s Polly Toynbee.

Let’s run through the ‘uncut’ argument.

1. State spending cuts are bad, and will undermine valued services which are best provided by the state.
2. Budget deficits, like the UK’s annual £170 billion debt rate, are also bad. It is right to try and reduce national debt and the spending deficit.
3. Raising taxes is not always good, though preferable to reductions in public spending.
4. How then do we plug the deficit, without reducing spending or raising taxes too much? Simple: we force rich companies and individuals to stop avoiding their taxes.

On the face of it, this is a powerful, practical ‘everyone wins’ argument. Congratulations should be offered to UK Uncut and its spin-off campaigns for bringing their agenda into the public eye through the targeting of a few case-studies. Bono and U2 are just the latest example of this.

So what’s the problem? Let’s dig down into the case against Bono and U2.

1. We are not morally or legally obliged to maximise our tax contributions.

I would even view this as a human right. We have the human right to act rationally wherever such action is legal. Minimising our tax contribution is always rational – particularly, in fact, for the very rich, as they are far less likely to need state support at some later point.

Being a multinational company or rich individual and earning a lot of money shouldn’t change this. Human rights aren’t human rights if they stop applying to you over a certain income threshold. Put it another way: at what point does a state gain the remit to delimit human rationality?

This is not to say that civil society shouldn’t be concerned with encouraging selfless, generous, charitable and social behaviours. But Bono surely ticks a lot of these boxes independently, as we shall see below.

2. Ireland is not a ‘developing country’…

…not in the sense that this term is usually understood, anyway. Art Uncut argues:

… [T]ax issues are crucial to development. Christian Aid estimates that developing countries lose $160bn annually, more than the global aid budget, thanks to unscrupulous multinational companies dodging tax. If we want poor countries to become richer, we need to adopt an ethical approach to taxation. It’s clear that U2 take anything but an ethical approach to taxation.

Even allowing this assertion – that developing countries are often screwed by tax-dodging multinationals – cannot help in the case of U2 and Ireland. Ireland is a highly developed and economically modern country.

3. Why should Bono trust Ireland with his money?

There is a reason, after all, why Ireland is now having to embark on a significant austerity programme. As a state, Ireland has hardly demonstrated fiscal prudence.

Irish spending policies contributed to a landmark unemployment rate and the country’s first recession since the 1980s. When the financial crisis occurred, the cost of bank-bailouts contributed to an already-vast deficit. Eventually, the EU and IMF stepped in, and other countries lent fiscal support to Ireland.

Perhaps Bono wouldn’t agree with the spending priorities of the Irish state. Perhaps he didn’t agree with the largely ineffective 40 billion Euro stimulus package, or the policy of buying out failing banks with their toxic credit. By the time of the 2008 crisis, U2 was already tax-resident in a different country; this was both legal and rational and, as an internationally successful band, not particularly strange either.

4. What if Bono spends his money more wisely and charitably anyway?

As the Art Uncut article states,

Bono presents himself as someone who cares deeply about development.

This is putting it mildly. U2′s philanthropy is near-legendary. The band has spent more than a decade (perhaps ironically) campaigning on third-world debt. Bono co-organised the Live 8 charity concert project. He is a founder of the Product Red charity brand campaign. He has his own charity – the One Foundation. This and other work represents millions of pounds of charitable contributions, on top of robust political activism.

I’m not a particular U2 fan, and there may be many good reasons to arch an eyebrow at some of Bono’s posturing, or question the effectiveness or sensibility of his approach. But to suggest that Bono is money-grubbing seems decidedly churlish.

Indeed, if Bono is choosing to reduce his contribution to one or another state infrastructure, and then pumps what surely amounts to more than the difference into charitable projects, and he chooses to do so legally, who has a moral basis for questioning his actions or attacking his civic sensibilities?

To conclude…

I suppose the broader point is that it would seem peculiarly trusting, even naive, if people imagined that in all cases the state they happen to live in is better placed to dispose of their money with wisdom. Yet to volunteer taxes – to offer, as it were, additional taxes, above those that are legally required – would be exactly the same as minimising personal disposable wealth. It would be an admission of incompetence, perhaps, or a wholesale acceptance of the idea that the state knows best.

Surely, and especially in the aftermath of the last few years, nobody actually still thinks this way?

I’ve had some interesting replies to my last post on this, so I thought I’d put down a bit more here. Just from the outset, though: I wrote the original piece out of bemusement that everyone had given up whinging about the NHS for a day. I was hoping to strike my usual balance of being critical of something while still supporting it overall.

The estimable Shiro Ota wrote this:

Perhaps the NHS does constitute some semi lack of freedom (to be as detrimental to your own health as you like, although most people who live in such a way don’t seem to worry too much about their moral responsibility not to strain the system); but surely that’s more than offset (by a long way) by the benefits of aiding those who are genuinely, unavoidably, unhealthy; and those who are upstanding; hard-working citizens who could, nevertheless, not afford equivalent private care.

Randian objectivism is an understandable system that would oppose an NHS. But without subscribing to that (which I don’t), I can’t see a case for opposing its institution. In post-war Britain; or at present.

The question of the balancing act returns, of course - do we derive a greater value (of freedom or whatever else is at stake here) from the existence of the NHS as we do from the potential state of its non-existence?

It’s hard to prove anything from a counterfactual (and I should know). I suppose that all I can say in reply to this is that I don’t feel the only alternative to socialised health-care is its polar opposite. This is reflected in the fact that a Labour government has been spending the last decade and more tying the NHS to private interests, partnerships, and investment. I don’t think it’s working – actually I think it’s disastrously half-arsed.

Coming from another world, though, where we never had an NHS, I think that state intervention would be perfectly acceptable in a system that is, for the most part, operated in terms of a free market of health-care. So I don’t think that Randian Objectivism is the only recourse, or that, indeed, it could be any sort of improvement.

Obamacare may be basically the right synthesis, in the end – I’m sure we’ll find out.

My sainted mother, Dani Kaye, wrote this:

And why don’t you mention what you would put in its place, given the relative poverty of such a massive proportion of the British population compared to, say, Switzerland, where we have mandatory health insurance?

Well I think I made clear that I wouldn’t do anything like remove the nhs… it’s too well-established. But if I was starting from scratch?

Subsidies delivered to essential, first-level health services and medicines, mandatory insurance with certain benchmarks of assistance based on personal income, anti-monopoly laws for hospital ownership and licensing permissions so there wouldn’t be too much geographical overlap… basically a really, really well-regulated market scenario. Rather than the current approach, which is to try to de-regulate, localise and set up PFIs etc. over the top of a state monopoly. No NICE, either: individual health establishments make their own decisions about their services, above a certain level. They compete, improved services are incentivised, and thus we’re hardly dealing with some anarchistic nightmare realm.

Another particular friend asks:

Is it just me or are the Daniel Hannan NHS comments pretty reasonable?

Well, Hannan clearly thinks the whole project was misguided, though he seems to agree that people have always meant well in instituting the NHS. I don’t actually have a problem with this guy. He’s mainly saying things that most people say every day: we spend too much money on it, it’s over-regulated, and it has crazy little breakdowns in its own special ways. It’s a perfectly reasonable point of view.

A few points about the general Fox coverage, though: Doctors over here are paid PLENTY. There’s no argument to be found on that. I truly believe that. Could they be paid more? Sure! But I don’t think their pay levels are in any way part of any of the problems that our system has.