Fairer Taxes and Inheritance for all: The economic Plans of Star Economist Piketty

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Thomas Piketty is probably the best-known economist of our time. In his works, he presents proposals on how we can make our economy and society fairer and more democratic. Pikettys economic plans include more economic co-determination, fairer taxes and a stronger welfare state. We have collected his most important demands and show what he stands […]

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Fairer Taxes and Inheritance for all: The economic Plans of Star Economist Piketty

Publicerad denFörfattareKontrast.at

Thomas Piketty is probably the best-known economist of our time. In his works, he presents proposals on how we can make our economy and society fairer and more democratic. Pikettys economic plans include more economic co-determination, fairer taxes and a stronger welfare state. We have collected his most important demands and show what he stands for.

DISTRIBUTING PROSPERITY MORE FAIRLY
The entire history of mankind is characterized by great inequality. A few people own the majority of the wealth, the rest share what remains. This small group of people is not only extremely wealthy, but also largely controls politics and the economy. Star economist Thomas Piketty wants to change this. He has developed reform proposals that distribute the wealth of our society more fairly and make our lives more democratic. The most important pillars of his reforms are economic co-determination, fairer taxes and a stronger welfare state.
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PROFIT INTERESTS USUALLY DECISIVE IN THE WORKPLACE
We spend a large part of our lives at work. While we make democratic decisions in almost all areas of life, there is hardly a trace of democracy in the workplace. In almost all companies, the owners alone make the decisions and employees have to follow suit. At most, they have a say. This is a particular problem because owners and employees often have completely different interests. The workforce wants good, stable jobs that will enable them to provide for themselves and their loved ones in the long term. Owners are primarily interested in profits. Everything else is secondary.
This contrast is particularly extreme in the case of large stock corporations. Shareholders are rarely involved in the work of the company and are often scattered all over the world. Their interest in the company is limited to how much money they can make with their shares.
MORE CO-DETERMINATION CAN MAKE COMPANIES MORE SUCCESSFUL
Piketty wants employees to have a say in their company. They should have half of all voting rights in large companies. If the owners want to change something in the company, they must therefore negotiate with the workforce. If the workforce has new ideas, they can push them through with the support of one vote from the owners. Piketty argues as follows:
Nothing guarantees, for example, that shareholders are more likely than employees to be able to manage a company or invest more in the economic project in the long term. Often enough, the opposite is true: an investment fund can get in and out of the company in the short term, while the employees have generally invested a significant part of their lives, energy, knowledge and skills in it.
In addition, unlike shareholders, employees often live in the vicinity of the company. If the company operates in an environmentally damaging way or if many employees suddenly resign, this has a direct effect on the lives of the employees, but hardly on the lives of the shareholders.
In working life today, those who have money decide, and the rest must follow. Piketty wants to democratize our working world. This should mean that our economy is not exclusively geared towards the profit interests of a few entrepreneurs, but towards the well-being of the entire population. With half of the voting rights, employees could ensure that the focus of their company is on the well-being of employees and local residents as well as the long-term positive development of the company, rather than just profits for owners.
THE BIGGER THE COMPANY, THE MORE DEMOCRACY
How voting rights are distributed in a company should, however, depend on the size of the company. Piketty’s principle here is: The more people work in a company, the more people need to be involved in decision-making. Let’s look at this using an example:
If a company has, say, fewer than 10 employees, the owner(s) can make all decisions alone. Only from the 10th employee onwards do the employees have half of the voting rights. From then on, the owner needs the support of at least one employee to make major decisions.
STRONGER WELFARE STATE INCREASES QUALITY OF LIFE
For Thomas Piketty, the welfare state is one of humanity’s greatest achievements. Free healthcare has caused our life expectancy to explode, free education has led to better technologies and products as well as more self-determination, and collective agreements and minimum wages guarantee that people no longer have to toil for a pittance.
Piketty wants to further expand these social achievements in order to reduce inequality and improve people’s quality of life.
ALL CHILDREN HAVE A RIGHT TO EQUAL EDUCATION
For Piketty, education is the basis for equality. Therefore, one of his most important demands is that all pupils have access to a well-funded public education system and that resources in the education system are distributed fairly.
Piketty criticizes countries such as the USA, where private schools and private universities play a central role, but also shows that in Europe education depends on income.
Using France as an example, he explains that the state spends three times as much on pupils who attend the country’s best educational institutions as it does on pupils who attend financially disadvantaged schools.
However, elite schools are often attended by the children of wealthy families, while children from low-income families often end up at disadvantaged schools. This further increases social inequality. Children from rich families benefit from the best public education, while children from poorer families receive a much poorer education.
This should change. The star economist is calling for “all children to be entitled to the same education spending”. State investment in the education system should not only be increased, but also redistributed. Instead of providing particularly strong support for children from wealthy families, schools with children from low-income families should receive more funding.
ALL PEOPLE HAVE A RIGHT TO A BASIC INCOME AND A JOB
The star economist also calls for everyone to have the right to a basic income that guarantees their livelihood. Although there are already programs in many countries, such as the minimum income in Austria, Piketty proposes reforms in this area. Everyone should be entitled to this basic income, including students and the homeless. In addition, people with an income below the basic income should automatically be topped up to this level without having to apply.
Piketty also advocates a state employment guarantee. Every person who cannot find a job on the labor market would be allocated a position in the public or charitable sector. The aim here is not to pay a pittance, but a decent wage with which employees can make a living.
A BASIC INHERITANCE FOR ALL
Inheritances are extremely unequally distributed. While the majority of Austrians inherit little to nothing, the richest people in the country have mostly received their wealth from mom and dad. Piketty wants to democratize inheritance. In concrete terms, this means that everyone receives an unconditional basic inheritance on their 25th birthday. This inheritance should amount to 60 percent of a country’s average wealth. In Austria, that would be around 120,000 euros. This basic inheritance is to be financed by taxes on large inheritances and assets.
This basic inheritance is intended to guarantee young people an easier start to adult life. They could use it to finance the down payment on an apartment or start a business, for example. When asked whether young people would not simply squander this gift of money, the economist replies:
“This can happen to rich people as well as poor people. I don’t believe that the children of millionaires only do clever things with their money. Rather the opposite.”
LIMITING PARTY DONATIONS
In order to protect our democracy, Piketty believes that the financing of political parties must be completely reformed. Today, corporations and the super-rich can buy political influence through party donations. We saw this in Austria under former Federal Chancellor Kurz.
Piketty wants a “total ban on all party donations from companies or other corporations” in conjunction with “a radical cap on donations and contributions from private individuals”. Private individuals should only be allowed to donate a few hundred euros per year to political parties. Instead, every citizen should have a certain quota of state funding at their disposal, which they can allocate to parties or political movements.
PIKETTYS ECONOMIC PLANS: WEALTH AND INHERITANCE TAX SHOULD FINANCE REFORMS
But how does Piketty want to finance all these reforms? By changing the tax system. The two basic ideas: the tax system should be simplified and the richest should be asked to pay more so that the majority of society can be relieved.
The basic elements of this are the introduction of a wealth and inheritance tax and a more progressive income tax. In addition, a progressive CO2 tax should be introduced and indirect taxes such as VAT should be abolished.
For Piketty, wealth and inheritance taxes are a key tool for achieving a fairer society. Austria does not have either of these taxes, although the vast majority of the population would be in favor of their introduction.
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Piketty’s concept of inheritance tax works similarly to that of income tax. Small and medium-sized inheritances should be taxed little or not at all. The higher the inheritance, the larger the share that has to be shared with the public.
In contrast to inheritance tax, which is only levied once, wealth tax is an annual tax. For taxes below the average wealth, an annual tax of 0.1 percent is levied. Similar to income tax and inheritance tax, wealth tax also increases with the amount of wealth. At 2 times the average wealth, the tax is 1 percent, 10 percent at 100 times, 60 percent at 1,000 times and 90 percent at 10,000 times.
To fall into the highest tax bracket here, you need assets of 2 billion euros. This top tax rate would only affect around the richest 20 Austrians.
LARGE INCOMES TAXED MORE HEAVILY
Even today, large incomes are taxed more heavily than small incomes in most countries. While top tax rates today are around 50 percent, they were significantly higher in almost all industrialized nations until the 1980s, reaching over 80 percent in the USA and the UK, for example. Since then, taxes have been cut for the rich and an ever greater proportion of the tax burden has been borne by small and middle incomes.
Piketty wants to reverse this trend and make the richest people pay more tax again. People whose income is around 10 times higher than the average income should pay between 60 and 70 percent income tax. Incomes that are 100 times higher than the average should be taxed at 80 to 90 percent.
INDIRECT TAXES ONLY WITH A STEERING EFFECT
In Piketty’s view, indirect taxes have no real justification unless they are intended to correct negative behavior. Accordingly, taxes such as a tobacco tax would be justified, but VAT would not.
The consumption of tobacco has serious health effects and causes enormous costs in the healthcare system. A tobacco tax makes cigarettes expensive. This is intended to discourage people from consuming tobacco. So there is a steering effect here.
This steering effect does not exist with VAT, for example. Whether staple foods such as bread or potatoes are taxed will make little difference to whether I buy these foods or not. They are essential for survival. So there is no steering effect here.
VAT in particular is an enormous burden for low-income households. Abolishing it would help these people in particular.
CO2 TAX SHOULD PARTICULARLY AFFECT THE SUPER-RICH
An indirect tax that is central to Piketty’s economic model is the CO2 tax. Unlike most current CO2 taxes, however, Thomas Piketty calls for a progressive CO2 tax. This means that the more CO2 a person consumes, the higher the tax rate at which consumption is taxed.
Data shows that a large proportion of CO2 emissions can be attributed to a relatively small group of super-rich people. This progressive CO2 tax would primarily affect this group.
The money raised from this tax will be used to support low- and middle-income households to switch to sustainable energy.
PARTICIPATORY SOCIALISM
Thomas Piketty calls his economic model participatory socialism. His demands are intended to ensure that it is not the richest in our society who call the shots, but that we all have an equal say in the direction in which our country and our world should develop.
The star economist takes up many of the demands already propagated by great social democrats such as Bruno Kreisky, Willy Brandt and Olof Palme. However, he modernizes them and goes one step further. His reforms would create a level of social equality and justice that has never been seen before, and guarantee that democracy permeates all areas of our lives and does not stop at the office door.
We must flood all areas of society with democracy. – Bruno Kreisky, former Chancellor of Austria
Who is Thomas Piketty?
Thomas Piketty received his doctorate in economics at the age of 22 and became a professor at the Massachusetts Institute of Technology at the age of 26. He is the founding director of the Paris School of Economics and also works at the École des Hautes Études en Sciences Sociales (EHESS). His research focuses on social inequality and the question of how we can create a fairer economic order. In 2014, Piketty published Capital in the 21st Century, which brought him worldwide fame.

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Star economist Isabella Weber: “Companies use inflation as excuse to raise prices”

Publicerad denFörfattareRss .

She is currently one of the most sought-after economists in the world: Isabella Weber is an expert on price trends and inflation – and is considered the “inventor” of the gas price cap. She has been awarded the Kurt Rothschild Prize for her work. We had the pleasure of meeting Isabella Weber for an interview […]

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Star economist Isabella Weber: “Companies use inflation as excuse to raise prices”

Publicerad denFörfattareKontrast.at

She is currently one of the most sought-after economists in the world: Isabella Weber is an expert on price trends and inflation – and is considered the “inventor” of the gas price cap. She has been awarded the Kurt Rothschild Prize for her work. We had the pleasure of meeting Isabella Weber for an interview and spoke to her about the consequences of price shocks, companies’ scope for action and the failings of politicians. As well as how we can better manage the next price shocks that are coming.

Kontrast.at: Ms. Weber, Austria has been the sad leader in inflation in Western Europe for months. We feel the high prices very strongly when shopping in supermarkets. If you compare the prices of the same products with those in Germany, your jaw drops. Where does that come from? Do the supermarkets in our country inflate prices excessively, or what is the cause?
Isabella Weber: It’s not that companies – such as supermarket chains – have become greedier overnight or anything like that. These price increases are simply part of a capitalist market economy in which companies want to make a profit. And that also means that these companies take every opportunity they can to achieve this goal. In this respect, we are not dealing with a sudden change in mindset or anything similar. Instead, we have experienced external shocks, price shocks, caused by the pandemic and the energy crisis.
1. IT WAS THE PRICE SHOCKS IN SYSTEMICALLY IMPORTANT AREAS THAT FUELED INFLATION IN GENERAL
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Kontrast.at: Now you could say that there were crises in one form or another in previous years as well. Why has inflation now skyrocketed – especially in our country – and remained so high?
Isabella Weber: We experienced high price stability for around 20 years. That was almost exceptional. It was a time that coincided with the financial crisis of 2008/09. There were large economic stimulus packages and a loose monetary policy. Despite this, prices remained relatively stable, and now we suddenly have this high inflation. Why is that? My finding is that there were major price shocks in systemically important areas that had an impact on other areas. So of course the energy sector is very important, but also areas such as raw materials, transportation, etc. At the same time, we have to ask of who is going to pay for these costs or the cost shocks.
In general, the corporate sector in most countries has managed to pass on this cost shock. In short, they have passed on the higher producer and supplier prices. As a rule, profit margins have been kept constant. This means that when energy prices soar – and with them the costs on the business side – and the profit margin remains constant, profits also go up.
Let’s take a refinery as an example: the refinery does the same thing it always does. It processes crude oil into a form so that it can be used. If the price of crude oil goes up, the cost of a ton of oil is still the same. But if the margin remains constant, then profits skyrocket. I would say that is the most general phenomenon.
But of course there were also supply chain bottlenecks that led to a kind of temporary monopoly. All companies in a sector knew, so to speak, that the competition had the same supply problems, and they reacted by raising prices – because they knew that the competition couldn’t undercut them.
2. COMPANIES WERE ABLE TO PASS ON COSTS – IN THE END, EMPLOYEES AND CONSUMERS ARE LEFT TO BEAR THE COST OF INFLATION
Kontrast.at: If companies have been able to protect their profits by and large, who are the losers?
Isabella Weber: If you consider that the corporate sector has protected its margins and at the same time wages have not kept pace with inflation, then the situation is that it is the employees as a whole who are bearing this cost shock. The latter are experiencing a crisis in which they are finding it increasingly difficult to cover the increased cost of living. This is particularly dramatic for the lower income groups.

By and large, the corporate sector has managed to pass on the higher costs and keep profits constant. In the end, consumers pay the price, argues economist Isabella Weber. (Foto: Melissa Mumic)
The German government has opted for measures such as one-off payments, i.e. it has left the price trend itself untouched. A few months ago, the European Central Bank (ECB) took action and raised the key interest rate. How do you assess this measure? What consequences did it have?
Isabella Weber: First, I think you have to realize that the interest rate hikes were a massive intervention. So there is a very massive political intervention in the economy – but through interest rates, not through price regulation. If I raise interest rates at this record speed, as has now been done, then on the one hand this creates a situation where the banks have opportunities to make excess profits. This is because the interest rate increases were not immediately passed on to savers, but were very quickly passed on to borrowers. This has created great profit opportunities. It is said that this is to combat inflation, but in fact such an interest rate hike is aimed at increasing unemployment. This is because higher interest rates affect the economy: investments and purchases become more difficult.
In the end, this also means redundancies. Higher unemployment in turn weakens the position of the employee side in wage negotiations. There is talk, quite euphemistically, of a “cooling off” on the labor market. This is supposed to sound like a spring breeze, but what they really want is for people to lose their jobs so that they have less leeway to demand higher wages. In my opinion, this is an extremely problematic way of doing politics. Because it fuels recessionary tendencies that are already visible in Austria, for example.
The price shocks and interest rate policy have exacerbated inequality in the corporate sector. Because when consumers have to spend all their money on covering basic needs, there is not much left to spend on other things. Companies are noticing this – especially smaller ones that cannot finance themselves on the financial market and are reliant on bank loans. Falling demand is having a massive impact on them.
3. PRICE BRAKES AND EXCESS PROFIT TAXES WOULD (HAVE BEEN) EFFECTIVE MEANS OF COMBATING THE PRICE SHOCK
Kontrast.at: In your opinion, what would have been a better alternative to intervene in the economy in this crisis?
Isabella Weber: I think that it would first have been important to stabilize these central prices or what I also called systemically relevant prices in my research. So that these price shocks don’t rattle through the whole system and have all these knock-on effects. That means, for example: Taxing excess profits. But it can also mean introducing a price cap to cushion the shock and prevent all these second-round effects from being triggered in the first place.
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Of course, in the energy sector in particular, we are talking about prices that hit both companies and households very hard. If it is a situation, as I have tried to explain, in which companies are able to react to these energy price shocks in such a way that their profit volumes increase, then this means that at the same time this energy price shock indirectly exacerbates inflation for households.
In this respect, I think the approach of energy price cap is definitely a good one. Because it protects basic needs. Because part of the energy consumption of households falls into the area of existential needs. I can try to heat less, but there are limits to the potential savings that can be made.
4. “WE NEED A NEW FORM OF STABILIZATION POLICY – ONE THAT AIMS TO SECURE BASIC NEEDS”
Kontrast.at: Do you think that these crises and shocks now have an expiration date? Or will they keep us busy for longer?
Isabella Weber: We are living in very crisis-ridden times. You could say we are living in a time of multiple crises. Climate change is a reality. Extreme weather events are already a reality. The situation in the Middle East is extremely precarious. There is a risk of a regional expansion of the conflict. In this respect, it is very likely that there will be further shocks. It is therefore also necessary to rethink the financial and economic situation. We need to find a different way of reacting to these shocks. We see this with interest rate hikes. They sometimes lead to recession. Then comes the next shock – what then? Interest rate hikes again, more unemployment?
We have to break out of this logic. We need to think about a new type of stabilization policy that aims to protect basic needs against these price shocks.
5. POLITICIANS MUST NOT JUST WATCH AND WAIT FOR THE MARKET – THEY MUST INTERVENE IF IT DOESN’T WORK
Kontrast.at: How does this “breaking out” work? Where should the big change take place?
Isabella Weber: For example, we need a different structure for the energy supply itself – then we won’t be so vulnerable when it comes to price shocks for oil and gas. At the same time, I think we also need ways of reacting to extreme price increases at short notice. For example, by having monitoring processes.
If you look at what has happened to gas prices: Prices have already risen dramatically in the winter of 2021. Sebastian Dullien and I published articles on the topic of gas price caps back in February 2022. Because even then – before the war against Ukraine – it was clear that these gas prices alone could trigger 2.5% inflation. But politicians didn’t say “gas is a systemically relevant price, we have to monitor it and react with measures”. They simply waited. In the case of Germany, until the fall. In the end, people’s basic needs were not protected. There really needs to be a rethink.
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Of course, you can’t always predict everything in advance, but there are prices that you know will have serious consequences if they skyrocket – and you have to react immediately. In this respect, you need a mandate to act.
What we are seeing now is that people are continuing to do their jobs and work – and yet are afraid that they will no longer be able to afford their basic needs. That’s breaking a social contract. The foundation on which a market economy is built is being shaken.
6. THIS INFLATION IS NOT ONLY SHAKING THE ENTIRE ECONOMY, BUT ALSO DEMOCRACY
Kontrast.at: What other dangers do these existential fears pose?
Isabella Weber: Well, if I can no longer be sure that I can meet my basic needs, if I have existential fears, then I become sensitive to angry and sometimes extreme ideas. We can see that in many European countries, radical right-wing or extreme right-wing parties are experiencing an upswing that should give us pause for thought. In the end, democracy is also being shaken.
That is why we need an alternative. The alternative means intervening and rethinking the state and the economy in such a way that they are attractive to the many and secure basic needs.
Who is Isabella Weber?
Isabella Weber is Professor of Economics at the University of Massachusetts, Amherst. Together with Sebastian Dullien (Scientific Director of the Institute for Macroeconomics and Business Cycle Research (IMK) at the Hans Böckler Foundation), she was awarded the Kurt Rothschild Prize this year for her research on the gas price cap to combat inflation.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast.at / Kathrin Glösel as the original source/author and set a link to this article on Scoop.me. https://scoop.me/isabella-weber-inflation/
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“Common-Good”: Germany to provide greater support for social enterprises

Publicerad denFörfattareRss .

The German government has unveiled its “national strategy” to provide comprehensive assistance and support for common-good-oriented companies. In the future, companies that focus on social and societal goals will find it easier to receive subsidies or loans. Around the world, there are more and more companies that strive for fair supply chains, sustainable production and […]

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“Common-Good”: Germany to provide greater support for social enterprises

Publicerad denFörfattareIngo Geiger

The German government has unveiled its “national strategy” to provide comprehensive assistance and support for common-good-oriented companies. In the future, companies that focus on social and societal goals will find it easier to receive subsidies or loans. Around the world, there are more and more companies that strive for fair supply chains, sustainable production and hiring disadvantaged people. But a strategy, as in Germany, is mostly still missing. 
The German government’s “National Strategy for Social Innovation and Public Benefit Enterprises” comprises a total of 70 proposals for improvement. The strategy is a joint initiative of the Ministry of Economics and the Ministry of Education. It aims to make the economy more ecological, sustainable and socially acceptable. This means less environmental pollution, no more human rights violations in supply chains and more occupational safety and fair wages for everyone involved.

This creates “improved access to financial support”, invests in the “expansion of the ecosystem”, and improves “the legal framework” according to Robert Habeck, Germany’s economy minister.

The program provides for the reduction of bureaucratic hurdles for start-ups with a common-good-orientation. In addition, the German Government will establish a central contact point for founders of social enterprises in October. 
Beside the simplified legal framework, the criteria for grants and subsidies will also be changed. For example, goals such as sustainable business and social responsibility will play a greater role in the awarding of the EXIST start-up grant. 
According to the Federal Ministry of Economics and Climate Protection, no changes to the law are necessary for this. As a result, implementation could take place quite quickly.
Common-good-oriented companies ensure that all employees are treated and paid fairly, from the extraction of raw materials to production and delivery. (Photo: Unsplash)
Companies can get loans more easily if they are not exclusively profit-driven
The German government does not make new money or new funding pots available for the strategy. Rather, it wants to open up existing economic development programs to public-benefit companies and make it easier for them to access loans. 
Until now, companies with a common-good-orientation usually had it very difficult to obtain bank loans or economic subsidies. This is because most banks and funders evaluate applications based on their likely economic success rather than the social contribution a company makes to society. A company that has the common good as its goal is therefore of little interest to them and not worthy of support.
What are Common-Good-oriented Companies?
Common-Good-oriented companies are not concerned with absolute profit maximization. Instead, they pursue social goals that benefit society. For example, by ensuring fair and transparent supply and production chains. This would bring fair wages and safe working conditions for all workers involved in a product or service.
In essence, the common good is about respect for human dignity, preservation of the environment, and solidarity with all. From the extraction of raw materials to production and delivery, the aim is to prevent environmentally harmful and unsustainable production, exploitative labor conditions and human rights violations. 
According to the Organization “Economy for Common-Good” there are more than there are over 1,000 companies in 35 countries that are committed to the common good.  
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It is not only about the well-being of all involved, but also about the well-being of society and the environment itself. Thus, in addition to social goals, environmental standards and sustainability goals such as those of the EU (Social Economy Action Plan) or the resolutions of the United Nations and the OECD are to be observed. Läs mer…

Fighting housing shortage: Airbnb & Co should share more data with authorities to prevent fraud 

Publicerad denFörfattareScoop Editorial

The business of platforms like Airbnb and Booking is booming: more and more private apartments are being rented out online. While this is good for tourists and hosts, it also leads to significant problems in many cities: fraud, housing shortages and rising rents can be the consequences. So far, there is no uniform system for data collection in the EU, which makes it difficult to control and prevent fraud and its negative effects. This is now set to change. Airbnb welcomes the EU’s breach.
Paris, Porto and Vienna: Europe’s major cities are popular travel destinations. Accordingly, many people vacation there. Around a quarter of all overnight stays are now booked via the major online platforms (Airbnb, Booking, Expedia and TripAdvisor). This is because the accommodations offered there are usually cheaper than hotels. This mainly benefits the hosts, platforms and travelers. 
At the same time, it causes immense problems for the cities concerned: lack of tourism taxes, housing shortages and rising rents are the result. This is mainly due to the fact that there is no reliable data on overnight stays. The EU now wants to change that.
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Platforms like Airbnb and booking.com to share data with authorities in future
If the EU Commission has its way, platforms such as Airbnb & Co. should share data with local authorities in the future. Specifically, the following information is to be made available: 

Who is the host?
Where is the accommodation?
How long is the accommodation rented out?

Private individuals who rent out accommodation are to be given a registration number, which is then also publicly available for all to see. This is not only to protect guests, but also to prevent fraud. Unregistered accommodations often lead to the evasion of taxes and tourism levies. The cities then miss out on these taxes when it comes to maintaining and expanding the necessary infrastructure (public transportation, waste disposal, etc.). 
Furthermore, the reporting obligation should contribute to fair competition with other providers such as hotels and youth hostels. In addition, the shared data makes it easier for authorities to manage the crowds in tourism hotspots.
Many cities, many different regulations: Airbnb welcomes EU breach
So far, there is no uniform regulation for the collection of data within the EU. That’s why more and more cities and municipalities are introducing their own. This complicates the business model of the platforms and the further development of the tourism industry. 
In an official statement, Airbnb welcomes the EU’s legislative proposal. This makes it easier to expand cooperation with governments and allows private individuals to rent out their homes without violating applicable rules.
Basically, cities benefit from tourism. Vacationers tend to consume more: they eat out more often, buy souvenirs, and go to the theater or other cultural events. In short, they spend money and that is good for the economy. And, of course, it’s good extra income for anyone who has a vacant apartment or room to rent out. Nevertheless, renting out private apartments in particular can lead to major social problems.
Andreas Schieder, head of the SPÖ-Delegation in the EU-Parliament, wants the new regulation to protect social housing in particular: 
“Short-term accommodation such as Airbnb is now an integral part of the tourism sector. Over the past few years, we have seen an enormous increase and therefore also observe new challenges. Particularly important to me is also the protection of municipal and social housing against misappropriation”.
Rising rents, increasingly expensive restaurants and congested infrastructure
On a random night in 2019, about 1.4 million tourist stayed in a short-term rental apartment. So demand is high. The lack of data and the resulting difficulty in regulation can lead to profound problem in the worst case. Among them, the following: 

Rising rents and less housing: it is often more profitable for landlords:inside to offer apartments as short-term accommodation. They earn more money that way. However, this reduces the supply of housing for the people who live there. 
Overloaded infrastructure: The large number of tourists overloads public transportation and strains waste disposal, since neither is designed for large numbers.
Changed cityscape: There are entire streets or blocks of houses that consist only of Airbnb apartments. 
Burdens for residents: The constantly changing residents can become a burden for neighbours. For example, through noise or the additional garbage that is created.

EU directive comes into force in 2025 at the earliest
Before the regulation on data collection and exchange comes into force, the EU Commission, the EU Parliament and the individual member states must first agree on a compromise. This so-called “trilogue” is to take place this year. After that, the EU member states will have two years – until 2025 at the latest – to implement the new regulations. Läs mer…

Fighting housing shortage: Airbnb & Co should share more data with authorities to prevent fraud 

Publicerad denFörfattareRss .

The business of platforms like Airbnb and Booking is booming: more and more private apartments are being rented out online. While this is good for tourists and hosts, it also leads to significant problems in many cities: fraud, housing shortages and rising rents can be the consequences. So far, there is no uniform system for […]

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Brazil: Deforestation of Amazon reduce by more than 30 Percent

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For years, the Amazon rainforest was cut down. The concern: the unique ecosystem could collapse. The deforestation in Brazil is a huge environmental problem. But the election of Lula da Silva as president gave hope. He announced that he would end the deforestation of the Amazon. In fact, the first steps followed a few days […]

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Brazil: Deforestation of Amazon reduce by more than 30 Percent

Publicerad denFörfattareKontrast.at

For years, the Amazon rainforest was cut down. The concern: the unique ecosystem could collapse. The deforestation in Brazil is a huge environmental problem. But the election of Lula da Silva as president gave hope. He announced that he would end the deforestation of the Amazon. In fact, the first steps followed a few days after taking office. The encouraging result: in comparison to the previous year, deforestation was reduced by more than a third.
“Brazil is ready to resume its role i the fight against the climate crisis and protect all ecosystems, especially the Amazon. Our government once managed to reduce forest destruction by 80%. Now lets all fight together for zero deforestation!” says Lula da Silva, President of Brazil.
The BBC reports first successes in the fight against rainforest deforestation. Compared to the first half of the previous year, deforestation was reduced by 33.6%. In June 2023, as much as 41% less forest was destroyed than the previous year. Brazilian Environment Minister Marina Silva attributes this to Lula’s successful environmental policy.
Lulas potential to reduce deforestation by 89 percent
Lula’s goal of ending deforestation by 2030 is a major challenge. Under his predecessor, Jair Bolsonaro, deforestation took on alarming dimensions. The new conservation plan, which President Lula published at the beginning of June 2023, aims to achieve this goal. Among other things, it provides for the confiscation of half of all illegally used land within protected areas, as well as higher penalties for illegal logging.
Furthermore, the Brazilian president calls on other countries, especially the rich West, to contribute financially to saving the “green lungs of the earth” in order to combat the climate crisis globally.
A study confirms that Lula’s plans actually have the potential to reduce deforestation in the Amazon by 89 percent. In any case, Lula will not have it easy: The left-wing president still faces a conservative majority in parliament.
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Under Bolsonaro, the Amazon shrank by more than twice the area of Vienna – per month
This is sorely needed, because the Amazon has been badly affected in recent years. When Lula first moved into the presidential palace in 2003, he launched an ambitious program to save the rainforest. He and his successor Dilma Rousseff, who like Lula comes from Brazil’s leftist Workers’ Party, succeeded in reducing deforestation by 80 percent to a historic low. But when Bolsonaro came to power in 2019, Brazil did an about-face on environmental policy.
Bolsonaro readily awarded concessions to allow corporations to clear rainforest for soy and palm oil farming, as well as cattle ranching and mining. Illegally cleared areas were legalized by Bolsonaro, and forest fires were fought only half-heartedly. Clearing jumped by 70 percent under his government.
For the first time, the Amazon emits more CO2 than it can absorb
Under Bolsonaro, the Amazon’s climate balance had turned around: For the first time, it emits more CO2 than it can absorb. This was shown in a study by researchers from the French National Institute for Agronomic Research. The scientists mainly analysed satellite data documenting the plant biomass in the rainforest and its deforestation. The result: the Amazon basin released about 16.6 billion tons of CO2 into the environment, but only absorbed about 13.9 tons. This 2.7 billion ton difference is roughly Austria’s consumption for 35 years.
Without well-maintained Amazon rainforest, the whole ecosystem could topple over
Currently, the Amazon has a perfectly functioning water cycle: regions inland actually have too little rainfall for a tropical rainforest. But the trees suck the groundwater upwards, it evaporates and rains down again over the huge forest area. This cycle could be permanently disrupted by further deforestation. The rainforest would slowly die, turning into savannah and changing the climate around the world.
This process would release as much CO2 as the entire world consumes in seven years. The unique ecosystem that is home to 10 percent of all species would be irretrievably lost, and with it the CO2-binding effect of the rainforest. Scientists assume that this tipping point is reached at a deforestation rate of 20 to 25 percent. Currently, we are at 18 percent.
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Deforestation in Brazil: Raids after taking office
Within days of taking office, Lula’s government took action, conducting checks in the rainforest against illegal logging. As reuters reports, controls were carried out in areas all within the Cachoeira Seca indigenous reserve, where deforestation is strictly prohibited.
While deforestation is decreasing, the number of fires continues to increase, satellite monitoring shows. Whether due to natural causes or arson cannot be determined.
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