Luxembourg: the worm in Europe’s apple

It is the backbone of European tax evasion. A financial colony. One of the most fervent representatives of the money empire at the heart of Europe. It has been a systematic saboteur of the fight against tax fraud for several decades. Luxembourg is still the leading nation for secret banking benefits, a genuinely barbaric relic which deprives Western states of annual income in the way of 180 billion euros. These kinds of countries are in fact responsible for taking away from our nations and from us – their citizens – a phenomenal sum in income taxes, accumulated wealth and inheritance. It is therefore in no way about fiscal competition, as it is for the advantages that Ireland offers to multinational corporations. The matter is quite simply that these countries are guilty of theft – or at the very least actively complicit – whose consequences are as harmful for the whole world as greenhouse gas emissions.

We are thus all paying the price for this, while the heads of these so-called havens profit greatly from it and who our own elected representatives appease. Because no one invests in the Cayman Islands or Luxembourg, which are actually just transit zones for capital gains being investigated for fraud, or at least fiscal accountability. There is no qualified work force or exceptional grey matter in these countries, which are entirely dependent on the pleasures – and achievements – of finance. The directors of these truly fake countries are therefore exposing their subjects to the fickle nature of the finance sector and are thus making them suffer economic volatility and instability, much like the opportunities seized – and then abandoned – by a versatile financial universe which, for the economy proper, is parasitic. With nothing to sell, nothing to produce and very few commodities, these countries are drifting away, with an ageing population that clings to amoral privileges that belong to another time. With annual growth at 1.4% since 1970, this is all Luxembourg has to offer to its nationals, along with the mediocre economic activity that it bestows, and that is owed to its headlong dive into the global casino of finance.

So here is what finance has done for Luxembourg: it ranks in last place among developed nations in terms of growth and material comfort that it provides for its residents. In reality, this country – which, unlike Switzerland, does not have an ancestral tradition in wealth management – is merely a hub for investment funds and offshore multinational financial institutions which in total have about 7,000 billion euros there, but at the same time tolerates all inequalities within its cramped borders. Did you know that the poverty rate there has actually doubled since 1980 and that unemployment has gone from 2 to 7% between 1980 and 2015, making Luxembourg the most unequal member of the OECD? Luxembourg – which of course is not the privileged Switzerland which disposes of a real economy and flourishing industry which competes on a global scale – now finds itself at a crossroads.

It must make a crucial choice and pull itself away from the global financial many-tentacled monster that dirties and corrupts it, if its desire is indeed to remain part of the European Union. The rest of the European nations won’t be able to tolerate an offshore platform within their own borders for much longer and there is no legitimate reason that this tax haven still weighs in on EU decision-making. If it wishes to remain a member, and if its aim is to still make up part of the European family – and to be worthy of it – Luxembourg must therefore urgently start behaving like an authentic nation rather than some sort of grotesque strongbox.