A global levy on financial transactions, however, would generate vast sums.
In a joint statement, they said London and Paris would collaborate on proposals for a new global levy on financial transactions: "To ensure predictable and additional finance to 2020 and beyond, we should make use of innovative financing mechanisms, such as the use of revenues from a global financial transactions tax". "Nicolas Sarkozy is one of my best friends.
The paper, which has passed peer review and is in the final stages of publication by the US journal Proceedings of the National Academy of Sciences, argues that a global levy on fossil fuels is the strongest tool for forcing energy firms and consumers to switch quickly to zero carbon and green energy sources.
Jaime Caruana, the chief of the Bank of International Settlements, stated that the most realistic way to institute a global levy would be to implement a similar levy in Europe.
The fund won't report back until next spring; even if it endorses the idea and the considerable technical issues can be worked out, any global levy will still run into the brick wall of Washington.
In brief, the proposal is that "some of the allocation mechanisms used by the Global Fund might be built upon by a democratized and strengthened global social governance system within the context of the sustainable resources available from a global levy based on global taxation with funds flowing through normal government budgets" [ 51].
"We need a global financial levy for the banks," he said in a television interview Sunday.
The idea of a global bank levy, which America and some European countries are keen on, has been dropped.
The finance minister of Canada, Jim Flaherty, said there was "no agreement" on a global bank levy to pay for future bailouts.
There are several options – among them a global insurance levy, the use of innovative contingent capital instruments developed in the UK, and a global transactions tax.
