I received this letter yesterday:
As has been apparent for some time, I have become increasingly critical of the Tax Justice Network and what I think to be its particularly destructive approach to the issues on which I once helped it campaign.
It is now clear that I am not alone in thinking this. For much of its first decade John Christensen and I worked tirelessly for TJN, and John stayed for very much longer as I took on new projects. John has now made it clear that he shares my view of the state to which TJN has descended.
I am now reflecting on this. I am, of course, sorry that matters have reached this point. I know how much effort John put in to avoiding this, and how much he has suffered for seeking to improve the situation, and admire his courage in now saying what he has.
Yesterday was a sorry day for the Tax Justice Network. It was, I think, a necessary one for tax justice.
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It seems as though the the TJN is on the road to the orthodox legitimacy (highly paid executives, more people to manage, pet projects etc.,) – seems like the standard Neo-lib means by which dissent and innovation is strangled to be honest – the leadership is essentially bought.
This is what very often happens after accepting Ford Foundation funding
This is well documented in academic literature
The campaigning zeal is replaced by a desire for bureaucratic tidiness and product standardisation
TJN has had major Ford Foundation funding in recent years
Expanding on that slightly perhaps we should accept that campaigning/NGO bodies have a definate shelf life. I’m not suggesting that these organisations simply cease to exist on expiration but some form of reassessment, even independent reassessment of a root and branch nature is carried out to identify weaknessed and positives. It seems to me that in chasing essential funding original purpose can be lost. Check where your money is coming from and what are the aims of the donors, is there excessive pressure on any one in the organisation and so on. Policies and aims should be restated or superseded. I was involved with an organisation in the early 90’s with some decent views and aims, I didn’t agree with everything but I don’t believe you can. Most of the policies stood out from the political climate at the time and there was quite a lot of smearing and even some active interference. As a result my group got quite interested in internal security and ways to deal with external interference. In the end the policies and aims were so overshadowed byissues of security that it forgot what it was actually for.
Indeed….
That’s very sad to hear. The TJN that you and John set up has done some huge valuable work whose impact we can see. We need it more than ever so I hope some kind of successor will emerge.
Let’s see
My first resort in seeking information about a body like this is Companies House. https://find-and-update.company-information.service.gov.uk/company/05327824
And the website. https://taxjustice.net/our-funders/
They say they are “equivalent to a US public charity (a 501(c)(3) organisation)” but it seems they are not registered with the Charity Commission, presumably due to concerns about their activities being too “political”.
The 2020 accounts are due to be filed in the next couple of months, but the latest accounts for the year to 31 December 2019 make interesting reading.
Income from grants of almost £1.5m, but two thirds is “restricted” (that is, earmarked by the donor for a particular purpose). And then 70% of the “unrestricted” funding – almost £400,000 of just over £550,000 – comes from one source, the Ford Foundation. $500,000 a year for four years, 2018, 2019, 2020 and 2021.
Expenditure is about £1.4m, and as you might expect, very much the bulk of expenditure – almost £1m – was on staff costs, for fifteen people.
When an organisation gets to a certain size, there is an ugly round of needing to raise money enough money each year to keep paying the staff.
The 2019 articles of association give the members the ability to give directions to the directors by special resolution. That is not unusual – there is a similar provision in the 2015 articles and it is in the model articles – but it is more unusual for it to need to be used. Sounds as though John Christensen and Alex Cobham do not agree on the way forward.
They do not
Nor do they agree on the need for very significant salary hikes in recent years
But the issue is really about what tax justice is about
We did not create a mediocre agency creating indices of little relevance and which now thinks the future for tax justice is all about tax as a feminist issue, important as that might be
We think there are massive issues still to address of a broader nature
And massive issues that as it stands TJN is failing on, including as a consequence if its deliberate alienation of the OECD, with which you do not need to agree to remain at the table, but where TJN now thinks insults work best, but don’t
The difference has become irreconcilable. The existential question is does TJN exist to keep a bunch of researchers with very limited knowledge of tax in employment, or is it seeking to deliver tax justice? I know where I stand
I also received the letter, since I am also a TJN Senior Adviser, and also helped to found TJN. While John raises some relevant issues, I think both his and your criticisms of TJN are confused and contradictory. Your comments also seem misleading. For example, John refers to a ‘multi-year multi-million dollar’ grant, and you to ‘major Ford Foundation funding’. Andrew has provided the actual amounts, and to me $0.5m a year seems a very small amount for this type of organisation. If there is a crisis, it seems to me that TJN is on a shoestring budget in relation to the work it does and what is needed. John argues that TJN needs to be a campaigning organisation, but both he and you condemn them for criticising the OECD. Reading TJN’s blog post and Alex Cobham’s tweets on the recent statement on the global minimum tax, they seem to me to be valid criticisms expressed in firm but respectful language, far from ‘insults’ as you suggest. We need to strengthen TJN not attack it. I hope that we can have a constructive discussion on how all tax justice campaigners can work together, and what is the appropriate role for each organisation.
Sol
Thanks for your comment. I am replying to your frank comments in similar direct style since you chose this method of address.
There some quite basic problems inherent in it. For example, you challenge John’s claim that TJN had a ‘multi-year multi-million dollar’ grant, and my claim that it had ‘major Ford Foundation funding’. Instead, you note that another commentator named Andrew has correctly surmised from the accounts that it was for US$0.5 million a year’. Multiplied to reflect the five-year grant period that is, of course US$2.5 million. Or as John put it a ‘multi-year multi-million dollar grant’, or as I put it, what anyone with any understanding of funding in this area would appreciate is ‘major Ford Foundation funding’. With respect, neither John or I were confused, contradictory or misleading. We both simply stated the facts. It is you who is misleading, confused and contradictory. I am bemused as to your reason for wishing to be so on such a simple issue.
I might also suggest that you are wrong to suggest TJN is surviving on a shoestring. It was in 2014, when the annual staff costs were £189,000. In 2019 they were £971,000. That reflects more researchers being engaged, plus a considerable expansion in bureaucracy, and an enlarged comms team. It also reflects considerable pay rises that absorbed much of the new funding, including the €700,000 or so I helped secure for it in 2016, for which I and colleagues at Copenhagen Business School received untold grief, and even abuse, as reward.
Noting all this, I would ask you a simple question which is what was the fivefold benefit in effectiveness resulting from this additional spending? As far as I can see TJN has made no progress on any issues of substance since 2015 when BEPS was concluded. It has issued a number of indices of little benefit. And it has doubled its web site traffic so that it is now about a quarter of that on this site. It has not changed any of the issues on which it supposedly campaigns, and whether it actually campaigns is in doubt: according to its website it has given up campaigning. And, as Alex Cobham has noted in a blog this week, it also has no idea where it is at now, but if it is anywhere he seems to think that identity politics and not tax reform is its future. But that, of course, just confirms that tax is not what it is about anymore, because no at TJN now knows anything about tax.
Might you suggest what I have got wrong? Might you do so in the context of the suggestions I have made on what I think tax justice should be doing now? Look over the last couple of weeks for those ideas, and watch all five of the videos I made to suggest some of the issues needing attention. I have bothered to set out a case, unlike you or Alex. Might you say what yours is? After all, discussing how we might work together is meaningless if we do not know what it is that tax justice is now about. I am bored with being told to toe the line when no line is specified by those making the demand.
One thing we might discuss is how to create relevant demands. In this context let me suggest why I think you and TJN have failed to influence the OECD of late, Alex’s abuse apart, to which I will turn after addressing this issue. To consider why that is the case let me firstly note that I am aware of your reputation as a theoretical lawyer. Your 1992 book on international tax was significant. But I have also worked with you over many years and am aware that all too often you are more than willing to ignore inconvenient facts, and on others to solely think that international tax is the only matter of concern in tax justice. For example, when Prem Sikka and I wrote a paper which you were tasked with editing in 2015 in which we explained the problem in using IFRS accounting data as the basis for the unitary apportionment of corporation tax profits you seemed never to understand, nor want to understand what we were saying, and why it was significant, and yet what we were saying was fundamental to what you, TJN and the BEPS Monitoring Group have been saying of late. We pointed out that your belief that existing accounts could be used as the basis for unitary tax apportionment was wrong, and you simply chose to ignore the two of us – just about the only two professional accountants working in this arena – because it suited you to do so.
The result is that you, TJN and the BEPS Monitoring Group have continued to promote apportionment on the basis of data that you know might be inappropriate for the task, and yet you chose to ignore that fact. In so doing you typify the TJN as it now is. A singular theoretical or political idea is used out of context and over-extrapolated to create a solution that is promoted without consideration as to its practicality. If you’d started by getting your basic arguments right maybe the OECD might have listened to you. As it is, I suspect they realised that going down your route was dangerous for all countries and could be subject to massive abuse, so they sought a classic compromise. If only you had listened and taken note. Why didn’t you Sol?
The same could, incidentally, be said of the idea that the UN can take over from the OECD as the organisation capable of managing world tax rules, which is utterly implausible as I am certain the UN would agree.
As to Alex Cobham’s tactics, I think your comprehension of English fails you. In a recent blog post he noted his reaction to the OECD deal, saying:
The global minimum corporate tax rate can mark the beginning of the end of the race to bottom on corporate tax. But the OECD increasingly looks unable, or unwilling to deliver a fair and effective reform. Countries should take the opportunity to push ahead with their own reforms, and consider the possibility of future negotiations being held under UN auspices instead.
I have highlighted the words that I think were deliberately offensive, and which I have good reason to think the OECD views in the same way, as Alex Cobham would have known at the time he wrote. And yet he continued deliberately insulting the one organisation capable of delivering tax justice reform, suggesting that it was not willing to do so, when my own experience suggests that it is committed to doing so and is all too aware of the issues to address in the current deal. You might believe that despite this Alex remains a person capable of leading TJN in such negotiations. Frankly, I doubt it will be invited to the table again whilst he is there. If you side with it I also doubt your BEPS Monitoring Group will be given much of a hearing either. I seriously suggest you attend to the glaring faults in your proposals before throwing more stones, and seek to make serious amends for the offence already deliberately given by Alex rather than side with him. I suggest too that you learn what campaigning is; you clearly have no idea if you think it amounts to criticising the OECD. Then you might influence the next round of this debate: I rather suspect you’ve blown it this time.
So let me make a penultimate point. I hear rumour that you are being lined up to replace John. You would fit Alex Cobham’s job spec. You have never run an organisation; do not know what a network is; do not know what campaigning is; and have a very narrow (i.e. solely international) and wholly theoretical legal understanding of tax and little or no understanding of economics, political economy, accounting and practical tax matters as they exist on the ground. No wonder Alex wants you and you’re happy to disparage John when it is your comments that make no sense.
My final point is this. If you really think John and I have raised concerns lightly, you are really very naïve. In addition to those we have noted we have many more we’d rather not make public that suggest a rottenness at the core of TJN as it now is that is deeply unpleasant. I know the stress John has suffered for trying to address this. I am well aware that Alex Cobham has banned his staff talking to me: they now live in fear of being sacked for doing so even though some remain friends of mine. Does that sound like a healthy organisation to you, Sol? We’re whistleblowing for a reason, and one of those reasons is that we know that what is wrong with TJN cannot now be solved behind closed doors.
I’d be pleased to discuss this with you, preferably offline. But don’t start by telling me I am confused. I know what is going on, and I do not like it. Nor, I suggest, should anyone else.
Regards
Richard
Oh, and a postscript: I know from prior experience that NGOs that make the most noise about the importance of whistleblowing are the very worst at protecting those who whistleblow. I’ve whistleblown before, so I know what I am doing. Bank CEOs who think themselves wronged by whistleblowers could learn lessons in revenge from NGO CEOs who think likewise.
Should anyone be surprised at the consequences of multi-million dollar ‘investment’ by the Ford Foundation to ‘build the TJN to the next level’ (we can guess what that means). Why would any Foundation with roots in a major US taxpayer have any interest in promoting real tax justice? Why would they inject billions without a big say in how it is spent? Big money corrupts just like big power. John and his decent colleagues has no chance from the moment that money was accepted – no doubt by those who had more interest in dollars in their pocket than tax justice.
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