As a major hydrocarbon company expresses its satisfaction at having succeeded in eliminating the tax on energy companies at the end of the year, the bank blames itself on the rate which will tax its profits in the next three years
In the midst of the political wind caused by DANA and its consequences, and while we see how important it is to have the public resources necessary to deal with emergencies like the one mentioned, large companies and financial entities are very concerned or, more directly, They explicitly oppose their contribution to public coffers being increased through taxes, even as their profits reach record figures. Thus, while a large hydrocarbon company expresses its satisfaction at having succeeded in eliminating the tax that hit energy companies at the end of the year, the bank is counting on the rate that will tax its profits in the next three years.
The CEO of Repsol, Josu Jon Imaz, expressed his satisfaction at the company’s General Assembly for avoiding the continuation of the tax on energy companies, while announcing a dividend of more than 30% for this financial year 2024 One of the spokespersons for the banking network claimed that this surcharge was unfair, since its profits were only 13% while those of IBEX as a whole were 20%. Another banking sector executive described such a measure as discriminatory and anti-competitive, while one of his colleagues alluded to the fact that the banking system’s ability to exert pressure was less than that of other economic sectors because they “n ‘had no chimneys’ and that they could not threaten to paralyze the banking sector either. investments. All this while another record bank profit was announced, with profits 20% more than the previous year. These same days, the CEO of Volkswagen Brands, Wayne Griffiths, said that the automotive industry was in danger, also calling for a reduction in tax burdens that affect the sector.
All of this is happening as voting takes place today in the United States. After a campaign in which, with the important nuances between a more obviously protectionist Trump and a more contemporary Harris, everything indicates that there will be a new twist to the economic nationalism already on the rise in recent months. But taxes also played a key role in the North American campaign, with Trump’s very notable tax cuts and Harris’ promises to improve the inequitable health care system. All this will ultimately have an impact on the country’s public deficit, which today already doubles the limit authorized in the European Union.
The imbalance between economic power and political power has a long history. But in each historical moment it takes shape in a different way. At the start of the 20th century, Hilferding was already speaking of banks as great controllers of the economy, seeking to move beyond the 19th century tradition in which capitalism was embodied by business owners. Someone to refer to, someone to discuss and talk with about how the business works and how profits are distributed. Since then, the process of making capitalism invisible has become increasingly evident.
We live in an era where the concentration of resources and power in the financial sector exceeds all previous limits, with a renewed ease of operating in real time anywhere in the world. The big financial funds that control the whole framework move money without problems, thinking about the medium and long term, while those who represent us move in the very short term. We are going through a period when public authorities need more resources to deal with situations of extreme urgency, caused by pandemics, natural disasters, conflicts near and far and widespread uncertainty, and the resistance of those who control the markets is increasingly evident. clearly.
The polycrisis scenario in which we find ourselves requires large-scale decisions. The Draghi report is an example. The growth projects we are working on are not working for us. The expiration date of the energy model is very explicit. But to respond to this framework, democratic and representative powers must have the necessary funds to do so. But, if every time these questions are raised, the response of large companies (very representative of each sector) is to threaten to leave, how can we act? We are not talking about powers that measure their strength on common grounds. Some use the normative resources to which their democratic representativeness entitles them. The others explain their “reasons”: large investment funds control more than 40% of global financial capital; If we refer to the United States, they own a third of the capital of the 500 largest companies; And if we find ourselves in Spain, the nine largest financial funds have invested more than thirty billion euros in IBEX 35 companies.
It’s not that we’re in an unprecedented scenario. The ability to threaten and lock public authorities into a scenario without a positive outcome has always been a resource used by those who, at a given moment, had sufficient economic power to be able to do so. The new thing is that from now on we no longer talk to those who make the decisions because they are the “owners” of the show, but we talk to the executors of a diffuse conglomerate in which all types of people and groups mix, including teachers. pension funds or nurses from who knows which country. Individuals and groups only interested in seeing their savings increase by a decent percentage, which will, no doubt, translate into better salaries and benefits for those who manage the issue.
What could we do about this? Public authorities must face these types of problems in better company and, to do this, it is important that, with regard to strategic issues, they share their management and strategy with a greater number of social and economic actors. The market cannot be a prison in which representative public authorities cannot function autonomously. To counter the disproportionate power of the business sector in politics, it seems necessary to encourage the participation of other social actors, such as trade unions, non-governmental organizations and citizen movements. This requires strengthening participatory democracy and creating spaces for debate in which diverse perspectives on key issues can be expressed. The most advanced sectors in the defense of the market economy itself have long warned that if the problem of inequality and the perverse effects of the system on environmental issues cannot be resolved, the possibility of survival of the system itself is threatened. Perhaps the time has come when, given what is happening, States and public authorities in general will have a much more active and decisive attitude regarding the control of key elements for the future of the planet.
