The Third World War: August 1985

It would not be sensible for Monte Carlo to be able to declare itself a tax haven and for all rich telecommuters to congregate there, while the poor of Europe congregated in some decaying old city like, say, Warsaw, which might then become the ‘welfare capital’ or ‘muggers’ capital’ of Europe.

It would therefore be advisable to have a European regional policy. One object: to attract more rich telecommuters into the troubled old cities like Warsaw so as to get a better social mix there (therefore, allow the inhabitants of Warsaw to pay a lower top tax rate on incomes above a certain size). Concurrent object: to persuade some of the poor to scatter from Warsaw to other areas. This would involve a direction that unemployed youngsters going on to social security would after a certain period get lower social security benefits in Warsaw than if they moved to seek jobs outside it.

Already in the 1970s New York City was suffering from not being able to implement a policy of this sort. High local taxes and crime rates meant that richer taxpayers were fleeing the city, leaving behind a city electorate that became poorer and so more left-wing, and voted itself larger welfare benefits which it could not pay for. The higher welfare benefits in New York City then attracted more welfare families in. There would be a spreading of this sort of vicious circle right across the world in the telecommuting age (and also of the twin problem of rich tax havens) unless regional policies of this type could be put in train.

The third leg of the European citizen’s ‘triple tax status’ would then be the leg of the nationality on which he chose to stand. There is the advantage that each person could, within reason, choose which this should be. National governments need no longer rule over purely contiguous groups of people. The problem of Belgium has long been that one part of the people has regarded itself as Flemish, the other as Walloon. With the tripartite system it should be possible for the Flemish to elect their own governments (for systems of family law, for cultural issues, including education, and for other representational matters) even while living amid the Walloons, who could similarly elect their own government. The same would apply to Catholics and Protestants living together in Northern Ireland and to the provinces of Yugoslavia, and, so long as national government diminishes in importance in this way, it might eventually be possible for the two Germanies to have a joint unimportant national government of the same kind.

It is probable that in the telecommuting age all areas of the world will eventually have to move to tripartite systems of this sort: with (a) continental-sized governments to pursue regional central tax policies in order to prevent some tax havens becoming ghettoes of the rich and some inner cities ghettoes of the poor; (b) very local governments, which could eventually become as small as particular groups of citizens wanted them to be (so that people who wanted to live in a commune and telecommute from it could set that commune up as a unit of administrative local government if neighbours agreed, while at the other extreme other groups might prefer to employ a commercial company on a performance contract to carry through administrative local government tasks rather than pretend that, for example, voting Republican or Democratic was the right way of getting a mayor who would be best fitted to find the most successful changing technology for operating New York’s drains); and (c) national governments that would have a diminished role over their peoples, who would not necessarily live contiguously.

The EEC at the end of the Third World War seemed lucky in being well placed to set up a prototype for this tripartite system, when it should be needed. One problem concerned the capital city or cities for the new Europe. It had been argued even before the war that the existing city of Brussels was too crowded for this purpose, and also, strangely, too central. A central city as a capital now means that centripetal forces become too strong, so that the central area grows richer and the flanks too poor. Even by the 1970s there had been grounds for arguing that the best scheme would be to have twin cities nearly a continent apart as capitals, joined by close telecommunication links and with great data banks planned from scratch for the new information age. A sentimental opportunity now presented itself. It was the Dutch Prime Minister who suggested at Copenhagen that the custom-built capitals of the new Europe should be Peace City West and Peace City East, built on the former sites of Birmingham and Minsk.