So Martin Parkinson gave a speech during the week talking about US economic diplomacy – okay not a bad speech as far as I can see. Yet something very different got reported in the media – I suspect the off-the-cuff comments from the Q&A session after the formal speech.
“When you see evidence of corporations and wealthy individuals trying to avoid their fair share of tax, trying to take shortcuts, ignoring the social licence to operate, that erodes trust in system,” he said.
“Even if they are still themselves actually individually getting better off, it erodes their trust in the system.
“I think what we are suffering from is a loss of trust. We’ve seen it happening over the long period of time in loss of trust in institutions and now I think what we’re seeing is a rise of populism that is a broader manifestation of that.”
To be clear – I think that more and more people are losing trust in social institutions. Especially big government. But look at what our chief mandarin – the number one public servant in our ever-increasing government – singles out. Taxation.
It is not at all clear that the rise of Donald Trump can be ascribed to people being angry about tax evasion or even tax evasion. To the contrary – Trump was accused all along of being a tax cheat.
Trump’s taxes have become a big campaign issue after the New York Times released a portion of his 1995 tax returns last week and estimated that Trump likely paid no taxes for a number of years. The celebrity real estate developer, who is the first presidential candidate in decades to refuse to release his full tax returns, didn’t deny the report. He later said that he had “brilliantly used” U.S. tax rules to his advantage.
During the first presidential debate with his rival Democrat Hillary Clinton last month, Trump responded to Clinton’s allegation that he paid no federal taxes by saying that would make him “smart.”
This morning Jon Faine was trying to make a big deal out of Parkinson’s comments, yet I think they are way, way off the mark.
Another argument that is going to be fun watching is the notion of a working class backlash against “neo-liberalism” and free trade yadda, yadda, yadda – both Brexit and Trump’s election has seen the “working class” move to the right of politics, not the side of big government.