Time for the G20 to Go Through a Martin Luther-Style Reformation

COMMENTARY Taxes

Time for the G20 to Go Through a Martin Luther-Style Reformation

Sep 6th, 2017 2 min read
COMMENTARY BY
James M. Roberts

Research Fellow For Economic Freedom and Growth

James M. Roberts' primary responsibility is to edit the Rule of Law and Monetary Freedom sections of Index of Economic Freedom.

Key Takeaways

The theological movement in developing the German language laid the groundwork for modern property rights, rule of law, individual liberty, and economic freedom.

G20 leaders rack their brains for creative new ways to tax so they can continue spending rather than minimizing the inevitable economic distortions caused by taxes.

It is well past time to downgrade the G20 back to the annual meeting of finance ministers that it was before the 2008 crisis.

How shrewd of Angela Merkel. She has managed to draw the world’s attention to Germany this month, just in time to celebrate the 500th anniversary of her Lutheran faith. But what would Martin Luther make of the G20 meeting of heads of state that she is hosting in Hamburg?

He would take one look at it, immediately grasp how much its complex bureaucratic superstructure has in common with the Catholic Church of his own day, and say, “Reform it!”

Germany’s most famous native son had a far-reaching impact on how we in the West live today. In the process of translating the Bible, he invented the modern German language. And the theological movement he led laid the groundwork for modern property rights, rule of law, individual liberty, and economic freedom.

The world could use another Martin Luther today. Our G20-style elites have set the same traps that corrupt church officials used to snare people in Luther’s time.

Just look at past G20 communiqués — and, yes, they seem to say the same thing year after year — and what do you find? Sacred vows by relentlessly secular, 21st century governments to build a heaven on earth through wealth redistribution schemes.

Feeding the hungry, creating jobs, doling out free stuff, and healing the planet do not come cheap, though. The elites demand 21st century indulgences from the faithful in the form of ever-higher taxes and ever-tightening state control of citizens’ lives.

There is evidence of the same old cronyism and corporatism along the way, too. Huge well-heeled corporations can and do lobby politicians for advantages, be they export subsidies or tax credits for new investments, in return for supporting the statist agenda. The G20 meeting process has evolved into just another venue for these corporatist transactions.

G20 countries could focus on minimizing the inevitable economic distortions caused by all taxes. Yet, rather than concentrate on reducing the need for more taxation by cutting government spending, G20 leaders always seem to come down on the side of adopting policies to fight tax avoidance. They rack their brains for creative new ways to tax so they can continue spending.

You don’t have to speak high priestly Greek and Latin to see that the names of G20 working groups — Investment and Infrastructure, Employment, Green Finance, Climate Finance, Energy Sustainability, and Development — are designed to justify coercive big-government programs.

What about the hundreds of millions around the world who have not been invited to share their views in Hamburg? Who will speak for them? Do the privileged groups attending the G20 gain an unfair advantage through access to world leaders? That is practically a definition of cronyism. And it is all the more ironic since one of the plethora of issues on the G20 agenda is corruption.

It is well past time to downgrade the G20 back to the annual meeting of finance ministers that it was before the 2008 crisis. It is a big enough job to strengthen the global financial architecture, and that work should continue.

Economic freedom rests on the empowerment of the individual, nondiscrimination, and open competition. None of these requirements can exist in a society that lacks effective rule of law. That rule of law, however, is threatened by G20-style cronyism.

Let’s hope that the G20 communiqué this year in Hamburg ends with a pledge to reform and to commit itself to the furtherance of economic freedom.

This piece originally appeared in The Hill on 7/8/17