In 2005, world leaders promised that all people in poor countries who needed HIV treatment would have it by 2010. But according to a new report by the World Health Organization, only 5.25 million of the 15 million who need it are receiving HIV treatment. Ten million people are still waiting, even though they are at high risk of advanced disease or death.
Meanwhile, rich countries are using the global financial crisis as an excuse for not increasing HIV funding. And the economic crisis is severely damaging the developing world in other ways as well. About 46 million more people are living in poverty, global job losses could total 51 million, and health investment in particular is under threat. According to the World Bank, up to 400,000 more infants in poor countries may die as a result of the crisis.
The improvements in treatment access and other advances that poor countries have made in the fight against HIV are fragile, and the stakes could not be higher. According to UNAIDS, 22 of the countries most affected by HIV in sub-Saharan Africa have reduced the number of new HIV infections by over 25%. But the broken promises of rich governments could quickly reverse these gains. A slowdown in funding would mean much more expensive health challenges in the future.
UNAIDS estimates that the fight against AIDS requires an additional $10 billion this year alone. But where will the money come from? Well, public outrage at the financial mess created by reckless banks has helped spark new interest in an old idea: creating a small tax on different types of financial transactions. A "Financial Transactions Tax" (FTT) would generate billions to fight HIV, maternal death, poverty, climate change, and other challenges. At the same time, it would help curb the irresponsible, speculative behavior that led to the economic crisis.
How would it work? An FTT would tax banks for many of the transactions they handle, such as the sale of stocks and bonds or the trading of currency. And the tax would be designed so that the purchase of stocks or bonds by consumers would not be affected.
The Leading Group on Innovative Financing for Development, a U.N. body of 60 countries, is studying FTTs. It estimates that a tax of only 0.05% on all financial transactions could raise $700 billion a year. And an even smaller tax -- 0.005% -- on currency transactions of the dollar, pound, euro and yen, could raise $33 billion each year. This foreign exchange market is the largest in the world, at $800 trillion a year, and is the only area of the financial sector that is not taxed. It has grown 20% in three years, and now trades $4 trillion a day. The vast majority of these foreign exchange transactions involve huge financial institutions buying and selling currencies for a quick profit. These transactions do nothing to create jobs or build infrastructure; they simply make wealthy individuals and companies richer.
Proposals for an FTT have received widespread support from a variety of European, U.S., and African leaders, including Ethiopian Prime Minister Meles Zanawi and U.N. Secretary General Ban Ki-moon. During the U.N. meeting on the Millennium Development Goals in September, French President Nicholas Sarkozy called for the creation of an FTT, saying the world has "no right to [seek] shelter behind the economic crisis as supposed grounds for doing less. Finance has globalized, so why should we not ask finance to participate in stabilizing the world, by taking a tax on each financial transaction?" He added, "While all developed countries are in deficit, we must find new sources of financing for the struggle against poverty, for education and for the ending of the planet's big pandemics." Several other nations have also voiced their support, including Germany, South Korea, Brazil, and Norway.
Economic advisers in the Obama administration have pushed back against the idea. But lack of consensus is not a barrier to action. Wolfgang Schäuble, the Finance Minister of Germany, recently told the German Parliament that an FTT should be explored, whether there was global agreement or not. "If we can get that through on the global level, then good. That would be ideal," he said. But if that doesn't work, "then we must look to the European Union. And if we have a problem with Britain, then I think we should try it with the euro zone."
Despite reluctance from some White House economic advisers, key U.S. lawmakers have expressed their support, including Speaker of the House Nancy Pelosi. Representative Pete Stark, a former banker who chairs the Health Subcommittee of the House Committee on Ways and Means, introduced the Investing In Our Future Act. It would create a 0.005% tax on currency transactions above $10,000, effectively excluding trades done by ordinary people from the tax. An estimated $28 billion could be raised over time from just this tiny tax. The bill calls for monies raised by the tax to be invested in domestic and global priorities: fighting HIV, tuberculosis and malaria; reducing the impact of climate change; and providing affordable child care to families in the U.S.
Activists from around the world have intensified their pressure on political leaders. In the U.K., the FTT is known as the "Robin Hood Tax," so at the 2010 International AIDS Conference in Vienna, activists dressed in Robin Hoodstyle green hats and interrupted a speech by Bill Gates, chanting "No retreat! Tax and treat!" At a press conference later during the conference, the U.N. Special Envoy on Innovative Finance, Philippe Douste Blazy, called on world leaders to support the FTT.
FTTs have been well tested in several countries: In the U.K. a 0.5% tax on the purchase of stocks raises about $6 billion annually. In the U.S. a small transactions tax has already been implemented to fund the Securities and Exchange Commission. In Belgium, an FTT raised 147 million euro in 2005.
The serious consideration being given to an FTT comes at just the right time. The richest 20 countries of the world -- the G20 -- will meet in November in South Korea, with an FTT high on its list of priorities.
People in the U.S. can take action and ask their member of Congress to co-sponsor the Investing In Our Future Act. (For more information about the act, including a current list of cosponsors, search for H.R.5783 at opencongress.org.) If your Congressperson is not a co-sponsor, call the Congressional switchboard at (202) 224-3121 and ask to speak with a staffer about the act. Tell him or her that you want your Senator or Representative to co-sponsor the legislation. You can also send an email by searching for "Investing In Our Future" at www.foe.org.
Asia Russell campaigns for access to treatment in developing countries as the Director of International Policy for Health GAP.