Monday, October 13, 2014

Bono: Low tax will save us all

Our old friend Bono granted a lengthy interview to The Observer at the weekend. It appeared in the New Review section, but really should have gone on the business pages it appeared to be marking the point where Bono shifted from apologist, to spokesperson, for capitalism.

Most notably, Bono attempted to justify Ireland's low tax regime as providing a route to prosperity:

"Look, Ireland is not going to back down on this,” he says. “We are a tiny little country, we don’t have scale, and our version of scale is to be innovative and to be clever, and tax competitiveness has brought our country the only prosperity we’ve known. That’s how we got these [tech] companies here."
Trying to use the lure of tiny corporate tax rates to build a prosperous nation is a bit like hoping to find a lasting, loving relationship by sticking your cock through a glory hole.

The companies opening their headquarters aren't actually headquartering there - generally, these tax-efficient operations consist of a bored person on minimum wage answering the phone with "no, we're not expecting Mr Cook in today" and a really, really huge shredding machine. (Although to be fair, Apple also have a room where they've stored all the unsold U2 limited edition iPods.)

The only local businesses who experience an uplift as being part of a low tax economy are brass plate engravers as the multinationals arrive, followed by a similar boost for carpetbag manufacturers.

U2 themselves are a pretty good example themselves - Bono, busily defending the idea that low corporate taxes are brilliant for Ireland did, of course, shift huge chunks of his own money over to mainland Europe when a more eye-catching low corporate tax rate waved a come-hither finger.

On that point, Bono is amusingly slippery, as he ignores the central problem - that he's shafted the country that he professes to love in order to save himself a few quid - by pretending that what's really upsetting people is the secrecy:
It isn’t a clandestine offshore tax haven, Bono insists. “All of our stuff is out in the open. How did people find out about it? Because it’s published. The sneakiness is when you don’t even know what’s going on.”
No, Bono. If someone livestreams themselves pissing through your letterbox, so you can watch as they do it, it doesn't make it alright.

It raises the alarming idea that when Bono watches a movie where the villain tortures the hero, but the villain starts by detailing what that torture will involve, Bono isn't horrified but reaches for the popcorn going "well, the cutting off of the arm and beating around the head has been publicly declared so I don't see there's a problem here."

Apple might be comfortably at home in Cork now - although the most generous headcount is 4000 Apple people, less than one-in-four of all their European staff. But people with longer memories will recall the tremor that ran through the area in 1999 when the globally nimble business realised it was better off making iMacs in Wales, taking two-thirds of the jobs across the border.

And Apple are probably amongst the most generous of the companies who have headquartered in Ireland - the Financial Times visited Endo, a pharmaceutical company who are now based in Dublin:
The global headquarters of Endo International is so new that, apart from a few desktop computers, the most visible purchase to date is the Nespresso machine in the kitchen. Located in the basement of a Georgian house in central Dublin, the company, which makes branded and generic medicines, does not even have a brass plate on the door.
Not even the brass plate engraver got a call.

Maybe the glory hole metaphor is the wrong way round, as Ireland isn't the one shoving its cock through the wall. It's on the other side, providing the service. And, sure, it's getting something out of the arrangement as long as it lasts, but everything could be pulled out without warning, leaving Ireland with a mess to clean up. And never able to look into the eyes of the person making the decision.