International Economics: IB Economics

Three of Scott Galloway's"The Four" have announced 40,000 job losses so far this year. If ever you want an indication of the future direction of travel in the global economy, then perhaps this is it. This time it's Google parent company, Alphabet shedding 12,000 workers, around 6% of their global workforce. 

The BBC's take on the proposed minimum global corporate tax rate. 

Are G7 nations likely to reach agreement on tax avoidance, and the use of tax havens, particularly by the tech giants, in the run up to this summer's Cornish G7 summit? 

Certainly, this Guardian article suggests this possibility. 

It's not been a great end to the year for Big Tech companies, with the news that ten American states are accusing Google of illegally maintaining it's monopoly on online advertising. 

Has the tide turned? It seems that competition authorities around the world have become keener to challenge the tech giants. 

Tax avoidance, big tech, the developing world. 

No surprises that its technology companies gaming the system once again - and the ethics of it? Well, their denying developing economies tax revenues that could help fund healthcare and education. 

Tax avoidance - a favourite issue of mine. 

Legal, yes. Ethical, no. Are we meant to be grateful for Google ending this practice, and how does it affect the way in which the ethics of the company are perceived? 

A question of tax avoidance or protectionism? The French would argue the former, the US the latter. 

I suspect that, as ever, the truth lies somewhere between the two.

Competitor wants large rival broken up.

Apparently that's news - however, Australian media giant Newscorp wants to see Google's search engine and advertising platform split up. But it would, wouldn't it?

Despite the introduction of the UK digital services tax in the latest Budget, it seems that the EU is struggling to do the same. And this should be no surprise, given the difficulties of co-ordinating the different member states.

A nice little boost for Irish government finances with Google agree to settle its outstanding tax bill, including some backdated tax payments - to the tune of £183m. Not an inconsiderable sum. 

Serves them right! But it's probably still less than they should probably be paying. 

It seems that we are on the verge of agreement between G7 nations about the need for, and nature of a tech tax. However, until a deal is concluded, there are still grounds for caution. 

I have relatively little to say about this, other than: it's about time. 

The big tech firms have, it is true, brought an awful lot of benefits. However, they've been able to free ride on technological developments generated by the public sector, harvest data at zero cost, in a way that discriminates against consumers and avoid tax to a ridiculous degree. 

Instead of lionising Sergei Brin, Larry Page, Mark Zuckerberg et al shouldn't we be vilifying them for not paying their dues to society? 

Just remember "We're All in this Together" - unless, of course, your on of the Big Tech firms, with the possible exception of Apple - who've done astoundingly well from the past few months.

Another US-based story, with the former Google CEO Eric Schmidt suggesting that the US has not done enough to fund new technology and has fallen behind China as a result.

It's a valid point, and one that has obvious implications for America's productive capacity, its supply-side and its international competitiveness, particularly in relation to China.

I'm deeply uncomfortable with this sort of story - large firm pays authorities off to end tax probe. This strikes me as subverting the rule of law - and irrespective of the size of the business - it is wrong.

I'm quite sure that Google's payment is contingent upon them not admitting wrong doing; indeed, Google will claim that they are complying with EU tax law. However, the loophole that allows Irish staff to sign off on all sale contracts is clearly a complete an utter nonsense.

But, if they settle - i.e. if they do a cost-benefit analysis and work out that settling like this will see off tax authorities, at a lower cost than paying their taxes like everyone else - this seems to be OK. I wonder if the taxman will allow me to pay what I estimate to be a fair tax bill in future. Tax avoidance, methinks.  

Mohammed El-Erian argues that the tech giants are driving a paradigm shift in policymaking, suggesting that such is their ability to persistently drive down prices that this present policymakers with new problems.

However, he also warns that this might not be a permanent effect - and that tight labour markets and declining levels of competition in certain markets might yet see inflation return.

That's the great thing about tax avoidance: you can claim that it's perfectly legal. But you can't claim that it's moral and you can't expect your users to think that you necessarily require such strategies to maintain your competitive position.

Your shareholders might thank you though. 

It appears that the current UK government aren't the only people guilty of 'cakeism' - in our case, over Brexit. Apparently, the US Treasury is upset by the prospect of EU policymakers imposing a digital tax on US tech giants, Amazon and Google. Who would have thought it? 

It's the Trump Presidency's approach to trade in a nutshell.