Sovereignty for Some: Racism, Immigration and the Global Tax Order

President Donald Trump has reimagined refugee admissions in the United States. His plan to slash the program by nearly 95% would gut what was once the world’s most generous resettlement program. Even more chilling than the scale of the reduction are the priorities that shape it. Trump’s new approach envisions an admissions system that overwhelmingly favors white refugees — particularly Afrikaners from South Africa. This represents a deliberate inversion of the moral logic that once guided U.S. refugee policy: the idea that the world’s most powerful nation had a duty to protect the most vulnerable. 

The cruelty of such an abrupt reversal is easy to see. Slamming the door on tens of thousands of desperate families because they are not white is an act of racialized exclusion that echoes earlier eras of American immigration law. But the irony of this moment takes longer to see, and it runs deeper. The same United States that now refuses to admit nonwhite refugees has long helped to create the very conditions that produce them. The machinery of global inequality — and death — that drives people to flee their homelands runs, quite literally, on tax law.

For decades, our international tax system has quietly structured the flow of wealth and power in ways that have stunted the Global South’s ability to build hospitals, schools and basic infrastructure. It has, in short, made certain kinds of death — avoidable deaths — inevitable. Racism is the reason why.

Whenever we explain that the global tax system we now take for granted emerged from a racial panic — one triggered by the decolonization of Africa — we get the same question: “There’s a global tax system?” And that’s fair. We don’t have a world government, so how could there be a world tax system? Yet one exists, and it was designed by powerful nations to preserve control over capital long after formal empires had supposedly ended.

Tax experts, of course, know all about this system. Some have built lucrative careers helping multinational corporations exploit it. They call it a “triumph.” If those same experts knew as much about its history as they do about its loopholes, they might hesitate before celebrating. Because once upon a time, the rules of international taxation looked very different.

Experts designed them to favor vulnerable nations rather than the wealthy multinationals that now grow fat by exploiting the system. The transformation from a system that protected the weak to one that enriches the powerful was neither accidental nor benign. Racism curdled the global tax regime much as we can now see it reshaping U.S. refugee policy.

In the 1920s, the League of Nations — a forerunner of the United Nations — sought to create mechanisms that preserved colonial hierarchies under the guise of international cooperation. Its Mandate System, which granted Germany’s former colonies “independence” under the supervision of European powers, was sovereignty in name only. Nauru, for instance, was technically independent but functioned for decades as an Australian colony in all but name.

At the same time, under the supervision of Columbia University economist Edwin Seligman, the league developed a set of tax treaties that worked much the same way. Seligman believed in empire. He sought to limit the ability of newly sovereign nations to tax multinational enterprises. Like the Mandate System, these treaties combined the appearance of autonomy with potent external controls.

For decades, Seligman’s treaties remained of “limited practical significance.” But that changed in 1960, when the world observed what was called the Year of Africa. Seventeen African colonies achieved independence that year. For the first time, Seligman’s tax vision came fully to life. It now had a target: Black sovereignty.

Seligman had once worried — without irony — that international tax rules might put the U.S. Treasury “at the complete mercy of” foreign countries. When the beneficiaries were European, such vulnerability was apparently tolerable. When they became African, it became unthinkable.

The newly independent African states that emerged in 1960 faced monumental tasks: to build schools, hospitals and democratic institutions in lands stripped bare by centuries of colonial exploitation. But as historian Leigh Gardner has shown, the colonial tax systems they inherited were ill-equipped for the demands of self-government. These nations needed to tax multinational corporations to survive. Instead, Seligman’s handiwork ensured that their sovereignty came preemptively hollowed out.

To understand the scale of this betrayal, consider what happened in Europe a few decades earlier. After World War I, with European cities in ruins, the United States offered a lifeline through a humble tax provision known as the foreign tax credit. This mechanism — the rule that prompted Seligman’s outburst — allowed U.S. companies to claim credit for taxes paid to foreign governments against their U.S. tax bills. The policy invited European countries to tax American investments. It was enormously generous and transformative, effectively encouraging investment abroad and helping devastated European economies rebuild.

Seligman hated it. To him, such unfettered generosity was dangerous. He preferred a system in which the United States maintained control. For the newly decolonized nations of Africa, that preference proved disastrous. The generosity extended to Europe after both World Wars was never offered to Africa after its liberation.

The result is the world we inhabit now: where tax rules written a century ago to comfort colonial powers govern the distribution of global prosperity. The wealth of nations continues to flow upward and northward, while the consequences — poverty, instability, displacement — flow south.

That is where the irony of Trump’s policies reveals itself in full. During his first term, Trump made it clear that he wanted no immigrants from what he called “shithole countries” in Africa. Yet the economic and political conditions he decries are not accidents of geography or culture. They are the predictable outcome of a global financial architecture built to ensure that formerly colonized nations would never fully escape the orbit of their colonizers. If not for a remarkable transformation of the international tax regime, those “shithole countries” might look very different.

Now, as Trump’s refugee policy promises to welcome white Africans while rejecting Black ones, we witness the circle complete itself. The United States helped design a global system that undermined Black sovereignty abroad; now it blames the resulting misery to justify racial exclusion at home. In a twist that would make a Hollywood screenwriter proud, the roughly 100 Afrikaners already admitted have complained about the lack of support once they arrived. Trump, of course, had already gutted refugee services.

Death, immigration and taxes: they are connected by the same historical throughline. The fear of Black self-determination that helped 20th-century tax treaties flourish and immigration quotas harden continues to define the boundaries of belonging today. The cruelty is not new. It is merely more visible now.

As we debate the morality of immigration, we rarely acknowledge the fiscal scaffolding beneath it. Tax law, more than almost any other system, determines who has the means to survive. The right to collect revenue is the right to govern, the right to imagine a future. Denying that right to postcolonial states was a way of denying their independence. Denying asylum to the people who flee those conditions is a way of denying our complicity.

If we are to confront the racial politics of immigration honestly, we must also confront the racial politics of taxation. The story of global tax law is not a technical footnote to globalization. It is the story of how empire survived its abolition.