In a period when punishing the poor is all the rage, it's heartening to see one economic argument going the right way
Before getting to the details and inevitable niggles over the G8 summit that formally begins today, it's worth making two observations. First, this meeting of world leaders is taking place just outside Enniskillen in Northern Ireland. A highly guarded golf course, to be sure – but, even so, holding such an event here just a decade ago would have been an unimaginable risk. This is a timely reminder that conflicts can be resolved. Second, a Conservative prime minister is on the warpath against tax havens. He may not have been quick enough; he probably won't be radical enough, but the fact remains: the leader of the party of finance is battling part of his own base – and inviting the public to judge him on the number of scalps gathered. In a period when punishing the poor is all the rage, it's heartening to see at least one economic argument going the right way.
It's also testimony to the power of public pressure. A few days ago, the EU commissioner in charge of cracking down on tax cheats, Algirdas Semeta, claimed that the Offshore Leaks revelations of secret accounts carried in this paper and others had "transformed" tax politics in Europe, by focusing public outrage and political initiative. Other milestones might be named: the revelations about Starbucks; Margaret Hodge regularly tearing strips off executives and their accountants. One result has been that this weekend Mr Cameron got the UK tax havens to agree to join the OECD's multilateral convention on mutual assistance in tax matters. That is welcome progress: it will help developing countries get information out of tax havens and so bring them extra revenue. The coalition will also create a register of firms and who owns them, which promises to crack down on shadowy "shell" companies.
Mr Cameron didn't need to wait till the eve of the G8 summit to sign and seal these initiatives. But armed with them, the prime minister can go to other world leaders claiming to have cleaned up his own backyard. Maybe, but with tax avoidance a lot lies in the detail. How heavily enforced will be the new beneficial register? Will Mr Cameron now force the Caymans and others to agree to full and automatic exchange of tax information – not just with the G8, but with developing countries too?
These are the yardsticks to judge progress in Fermanagh. No 10 may not have put enough elbow grease into getting such a deal; but at least it now largely agrees with tax campaigners on what success would look like. Without India and China, let alone the poorest countries, the G8 remains the wrong group to do international economic governance. But with the G20 not fit to replace it, the next couple of days are the best shot we have at putting the world financial system on a sounder footing and a fairer basis.