Posted on 10/10/2009 5:03:04 AM PDT by reaganaut1
Taxing financial transactions on Wall Street is gathering support in high places.
With federal budget deficits soaring, policy makers and other advocates are eyeing the huge sums that could be raised as a way to cover the costs of new initiatives.
Labor unions, in particular the AFL-CIO, have proposed a financial-transactions tax as a way to defray costs of a health-care overhaul. Lawmakers have discussed a similar fee as a way to cover the cost of future financial oversight. Liberal advocates are pushing the tax to pay for new stimulus spending.
This week, the left-leaning Economic Policy Institute floated the idea of a national transaction tax that would raise $100 billion to $150 billion a year. The tax, at a rate of 0.1% to 0.25% of the value of the trade, would be levied on all financial transactions such as stock trades, but not on consumer transactions such as with credit cards.
The money would be used initially to pay for temporary aid to states, hiring incentives for public- and private-sector employers and school construction money.
"We are in a difficult time right now, so people are looking at every opportunity to gain some revenue to fund" new initiatives, said Rep. Stephen Lynch (D., Mass.), a member of the House Financial Services Committee. "Because I was one of the first to suggest using this to fund [new] regulatory infrastructure, folks have come to me and said, 'That's a good idea; I've got a better one: Why don't we use it for stimulus or especially health care?'"
One Democratic aide said the idea is under consideration among House leadership, though the discussions are preliminary.
(Excerpt) Read more at online.wsj.com ...
oh great - tax investment. That’ll fire up the engines of economic recovery...
Stocks and bonds. Thus every transaction the Union Pension fund does would be taxed.
Or are they going to be exempted from this law the same way they are on Democrats Health Care destruction bill?
Since when does the AFL-CIO advise on taxing the financial industry?
I think we should have a tax on union dues.
It would raise a ton of money, and help defray the costs of health care/insurance “reform”.
Seems fair.
These nitwits are absolutely begging for a barter economy.....just like when our last Nobel Prize winning POTUS was in office.....
I've got an idea. How about no more new initiatives, therefore, no need for new taxes.
we're looking to screw the private sector even more.
Exactly right. You want to tax that which you want to prevent.
Democrats are exactly the same.
This week, the left-leaning Economic Policy Institute floated the idea of a national transaction tax that would raise $100 billion to $150 billion a year. The tax, at a rate of 0.1% to 0.25% of the value of the trade, would be levied on all financial transactions such as stock trades, but not on consumer transactions such as with credit cards. ....
...Transactions taxes first were proposed in the 1970s for currency trading, to reduce volatility in exchange rates. The idea later was seized on as a way to reduce volatility in financial systems.
So they want to both raise billions of dollars and reduce financial volatility. Reducing volatility is a code word for reducing the number of transactions because markets can be (and usually are) even more volatile if there are limitations on trading. If you don't have continuous information on pricing, but only have a few big transactions the price jumps will be larger. If the tax reduces the number of trades, then it will reduce the revenue from the over $100 billion per year to far less. Most trades are arbitrage trades relying on fraction of a percent differences in prices. Tax those at even 0.1% and they will either not happen or happen outside the United States (phone calls and internet connections are cheap, so traders will be just as happy if their trades happen in London, Tokyo, or a server farm on the Cayman Islands).
Also note that a "financial transaction" isn't well defined. Sure, they say that credit card transactions aren't covered. But will depositing your paycheck be covered? How about writing a check to pay your credit card bills? Moving money back and forth between savings and checking to get a little interest bump? Putting money into a 401k? Buying stock or mutual funds inside the 401k? Selling those? Taking the cash back out? Depending on definitions, even saving for retirement with one buy and hold stock purchase could hit the taxpayer with the tax four times total. And the big boys on "Wall Street" (wherever that ends up) won't be touched unless the tax is charged by every government in the world because they will be able to choose where to make their trades and hold accounts.
State Sen. Vladamir Himmler (D) remarked; "Why are people allowed to consume air at no cost or penalty? Every time they exhale, they exhale dangerous CO2 gases, which harm the environment. This revenue generation will put a check on that behavior, and provide funds for deserving teachers.
Then let me be the first to suggest that we begin dismantling the Federal regulatory infrastructure to finance private enterprise.
C02 gases actually help the environment - it’s spurs plant growth.
“Or are they going to be exempted from this law the same way they are on Democrats Health Care destruction bill?”
You get three chances to answer this question. 1...2...3
“The money would be used initially to pay for temporary aid to states, hiring incentives for public- and private-sector employers and school construction money.”
Meaning, once again, the government is just taking hard-earned money and throwing it away.
If this tax passes you can kiss Wall Street and any other exchange good bye as they would close shop and move overseas.
“This week, the left-leaning Economic Policy Institute floated the idea of a national transaction tax that would raise $100 billion to $150 billion a year. The tax, at a rate of 0.1% to 0.25% of the value of the trade, would be levied on all financial transactions such as stock trades, but not on consumer transactions such as with credit cards.”
this would be (at minimum) $10 for every $1k....each way! So if you bought $10k and then sold at 12K, your tax would be $220....since it is a “transaction” tax, you’d have to pay it on a losing trade, too....fkn commie Dems
As par, the government thinks the general populace is stupid and has no clue how to spend their money hence why they tax: because the government should be the ones to dictate how to spend our hard earned money. Social justice and spreading the wealth, huh?
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