First, as there was a century ago, there is a need to tackle monopoly. It is prevalent, and abusive. The nature of the beneficiaries might have changed a little: although a few individuals stand out in the public eye the gain is to a whole institutionalised minority as well now, but the fact remains that is at cost to the rest of society and to the rest of business. Major reforms to limit the power of monopoly, force the break up of monopolistic businesses, require their state control in some cases, and to impose higher taxes so that returns are normalised during transitions to new structures will have to be delivered.
Second, international abuse will be tackled. This will either be done internationally, or unilaterally if that fails. My proposal for an alternative minimum corporation tax, made a year or so ago, could be part of that unilateral response, I think.
The correct measure to reduce monopoly power is to ensure a monopoly tax system.
This is fun though, Ritchie is advocating the expansion of Vanguard:
Fifth, the age of the company pension fund will pass: common funds that will, however, be funded and at the same time be common pools of pension capital will become the norm.
Seventh, tax reform will reduce national insurance charges. Increased corporation taxes on monopolies and ‘non-cooperative’ companies will help fund this. So too will a turnover tax – a carbon usage tax or CUT as I called it in The Joy of Tax.
If you want to tax carbon why not just tax carbon? You know, a carbon tax?
Ninth, to reflect this the law on directors’ duties will change. The duty will be to creditors and stakeholders as well as to shareholders and the suggestion that profit maximisation is the objective of the company will be removed. Quite explicitly the company will first of all be required to act ethically; to show environmental concern; to pay creditors on time; to maintain staff welfare; to meet pension obligations in full; to make full disclosure of its activities and to comply with the letter and spirit of all laws whilst securing the long term goal of meeting the needs of society, which will require it to maintain positive cash flows.
Most amusing. So, how will a company ever invest if it must always have positive cash flows? Running at a loss as you build will now be illegal.
Tenth, worker and other representation on boards (I see roles for community representation as well from locations where a business has material impact) will be required to ensure commitments to society are met. This will require appropriate training paid for by the state for those involved: the farce of the ‘usual culprits’ from big business taking these roles has to end. These representations will be at subsidiary board as well as at main board level.
This is known as the “Gissa Job” clause. It always appears in the Senior Lecturer’s noodlings.
Eleventh, to ensure that the cost of capital to meet these objectives is kept low a policy of low interest rates will be required of governments.
Quite wondrous, entirely ignorant of supply and demand. For low interest rates don’t exactly ensure a supply of capital now, do they?