Basic structure and tax havens

In this paper I argue that Rawlsian Law of People (LP) is much more useful to the debate on international distributive justice than it is commonly assumed by many leading political philosophers (Pogge, Nussbaum, Sen, Beitz, Singer). I will show: 1) that these criticisms are misleading, insofar as they do not take the concept of basic structure seriously, and they reduce LP to an instance of ethical statism or of acritical acceptance of cultural pluralism; 2) that the basic domestic structures, and the principles that govern them, depend on the law of peoples and its principles as well. Therefore it is not true that each basic structure is independent of what occurs in the international field; 3) that, even though his argumentation is not clear, Rawls admits the use of distributive principles in the international domain, but only to some extent. Therefore, it is not true that his doctrine has no normative bite. On the other hand, the discussion has focused only on the application of the difference principle, as the only principle that should be applied even in the international domain on the basis that it nullifies the influence of arbitrary factors such as birth in poor countries. However, as I will show later, this position assumes what Rawls has denied in many passages of TJ: that his doctrine is a form of luck egalitarianism; 4) that the concept of basic structure as a set of institutions that can govern the entrance and exit of their members and their wealth, is necessary in order to provide a normative evaluation of phenomena such as multinationals’ tax avoidance through the use of off-shore branches situated in the so-called tax havens. Far from being suited to a “vanished Westphalian World”, Rawlsian doctrine can offer us moral guidance when we face these forms of free riding that threaten the integrity and stability both of national tax systems and, as we are experiencing right now, of the international economy. Thus, I hope to show that, if my points are correct, there is room for a theory of international distributive justice that follows the principles formulated in LP.