
Why Trump torpedoed global tax justice
With all the current talk of an American oligarchy, I’ve been wondering what we now mean when we say “oligarch.” The word comes from the Ancient Greek oligos, meaning “few”, via Latin and mediaeval French, but its modern meaning in English owes more to 1990s Russians, who adopted the word to describe the architects of what David Hoffman, in his book “The Oligarchs”, called “a warped protocapitalism in which a few hustlers became billionaires and masters of the state.” As for the masters of the U.S. state – well, Donald Trump is the richest American president in history and, should he get his way with his Cabinet picks, will preside over the richest administration in history. The imbalance is so pronounced even some turkeys are voting for Christmas, with a recent poll of G20 millionaires showing that 63% of those surveyed believe the “influence of the super rich on Trump’s presidency is a threat to global stability.” The solution, even some of the richest among us argue, is to tax the super rich.
But first, a sincere apology, with the emphasis on sincere.
SORRY
I apologise if Mark Zuckerberg was offended by me calling him an oligarch, as he apparently was when Joe Biden implied it in his valedictory warning.
Comrade Zuckerberg’s dismay is understandable. Russia’s oligarchs were extremely rich and rapacious. And they have, since the full-scale invasion of Ukraine three years ago, been subject to tens of billions of dollars in sanctions by the U.S., EU, UK and others. Whereas all the lovely Mr. Zuckerberg has done is run a social network that spreads violence, fraud and misinformation and given him a personal fortune currently estimated at $233 billion.
Personally I think we should probably stop using the word oligarch to describe Russia’s super-rich now anyway. Ever since Vladimir Putin cemented his control over the country, not least by arresting the then-very-wealthy Mikhail Khodorkovsky in 2003, Russia’s business leaders do not interfere in politics at all and just do what they’re told. Dictatorships after all only have room for one leader, not a few, no matter how wealthy.
I did wonder, briefly, if I should get in touch with Zuckerberg and explain my position. When I call him an oligarch, I’m not comparing him to people like Arkady and Boris Rotenberg, pals of Putin since childhood. As I said, these days Russia’s wealthiest people, unlike America’s tech billionaires, are cowed functionaries, not strutting kingmakers.
But then I saw a picture of Zuckerberg, Elon Musk, and Jeff Bezos sitting in the front row at Donald Trump’s inauguration, in more prominent positions than his cabinet picks (though many of them are billionaires too). I’m sure their positioning was intended to make them look like masters of the universe. But they reminded me of those Indian maharajas who were allowed to hold ceremonial positions of honour in the British Empire, as long as they did nothing to threaten London’s control.
Despite all their ostentatious loyalty, the maharajas ended up being cut off with nothing. So perhaps friend Zuckerberg should actually be grateful that he is being called an oligarch. It assumes that he is, in fact, a strutting kingmaker with his hand on the levers of power, rather than just another brown-nosing billionaire. As Trump posted on his social media network last month: “EVERYBODY WANTS TO BE MY FRIEND!”
If you think the comparison to the British Empire is overblown, I’m not the only one making it. As Oxfam pointed out just last week:
“Today’s world remains colonial in many ways. The average Belgian has 180 times more voting power in the World Bank than the average Ethiopian. This system still extracts wealth from the Global South to the superrich 1% in the Global North at a rate of $30million an hour. This must be reversed.”
NOT SORRY
The world was inching towards a sort of redressal, though not a real reversal, of this situation thanks to the global corporate tax deal pushed by the Biden White House which would have required multinational companies to pay a minimum tax rate of 15 percent. The deal ran the gauntlet of all kinds of special interests and finally, albeit in diluted suboptimal form, seemed like it would form the basis of the most significant reform to global taxation since, well, the days of the British Empire.
But then along came Trump, who has killed it because it’s 2025 and we’re not allowed nice things anymore.
Frustration with the tax minimising antics of U.S. multinationals had already led to unilateral “digital services taxes” in France, Italy, Spain, the UK, India and New Zealand so the failure of a global deal may not enable a complete feeding frenzy for the not-at-all oligarchs of Silicon Valley. But Trump, who has his not-at-all oligarchs’ backs, has already told U.S. officials to draw up “a list of options for protective measures or other actions that the United States should adopt or take,” if foreign countries are found to be “likely to put tax rules in place that are extraterritorial or disproportionately affect American companies.” No doubt there will be threats of more tariffs to come.
Many activists have long argued that the right forum for global tax discussions is the United Nations, which last year launched a tax convention that is due to report back in 2027. An effective tax deal, though, would need the agreement of the world’s richest countries. That is why I supported the process led by Biden, even though it was so unambitious. But now that’s been torpedoed anyway, maybe it’s time to give the UN bodies a chance, as the overwhelming majority of the countries represented in the general assembly have voted to do. In the words of Irene Ovonji-Odida, the chair of the Tax Justice Network:
“We will all negotiate together to set rules that work for everyone. Everyone except the tax abusers.”
Only nine countries voted against the UN process. Not surprisingly, they are among the world’s richest – the United States, Canada, the United Kingdom, Japan, Israel, South Korea, Australia, Argentina and New Zealand. These countries, as a Tax Justice Network report shows, are responsible for a vastly disproportionate loss of global tax revenues due to corporate abuse. So it’s up to the citizens of these countries (and funnily enough, I’m a citizen of two of them), to change their leaders’ minds, because they look unlikely to do it on their own.
Sadly, we recently lost a frontline warrior in this very struggle. Elise Bean did more to expose the inner workings of tax havens, unscrupulous corporations and kleptocrats than all but a tiny number of people worldwide.
First at the U.S. Department of Justice, then with Senator Carl Levin when he headed the Senate Permanent Subcommittee on Investigations, and finally for the Levin Center for Legislative Oversight and Democracy, Elise was a source of wisdom, positivity, calm and integrity. She investigated and exposed the secrets of Enron, money launderers, commodity speculators, unfair credit card companies and more, and set an example of cross-party fact-based cooperation that was unrivalled. I was not the only person who relied on her generosity and breadth of experience and knowledge for my books and journalism.
Transparency International U.S. called her “the embodiment of effective civil service and a living example of how our government should work”. It seems particularly cruel that she should have died just when the values she represented are needed more than ever.
A version of this story was published in this week’s Oligarchy newsletter. Sign up here.
Header illustration by Teona Tsintsadze/Getty Images.