Democrats Push to Tax Wall Street Trading

[octoberlib]

Democrats were unsuccessful in their push for a financial transactions tax after the 2008 financial crisis, but after 11 Eurozone countries received approval to institute such a tax Tuesday, two lawmakers are planning to try again. Rep. Peter DeFazio (D-OR) and Sen. Tom Harkin (D-IA) will reintroduce their proposal, which would raise an estimated $352 billion over the next decade by instituting a 0.03 percent tax on financial trades.
A financial transactions tax would slow down high-frequency trading, which has exploded in the last five years. Such trading “has absolutely no social value,” according to one of its pioneers, and only increases volatility in the market. The tax would have little effect on normal traders.
Critics of the Euro-wide turn to a transactions tax say it could slow down growth and encourage businesses to move elsewhere, and similar claims have been made about the American version. But 52 financial executives endorsed the tax last year, and DeFazio told ThinkProgress last year that such claims are false.
“For 50 years we had a tax that was about seven times larger than this when the country was seeing the greatest growth in its history, post-World War II,” he said. “So we’ve proven this will not have a detrimental impact on growth. In fact, it perhaps is beneficial to growth. It’s not necessarily beneficial to salaries of hedge fund managers on Wall Street.”

http://thinkprogress.org/economy/2013/01/23/1483711/democratic-lawmakers-to-re-introduce-financial-transactions-tax/

[Angry Dragon]

1. tie it to funding the military

Any money that is raised from Wall Street goes to fund the military and the military gets monies from nowhere else ...........

[JaneyVee]

2. Now we're talking.

[kentuck]

3. Why not go for one/tenth of one percent?

And get a trillion dollars in revenue over 10 years? That would equal one penny on every 10 dollars.

[Spitfire of ATJ]

18. The Republicans don't WANT the typical American to know how much the rich have.

They want Americans to believe the rich are suffering along with everyone else.

Their narrative is that the rich really want to hire people but can't because money is tight and they can't afford it. That's why EVERY "jobs bill" they introduce is designed to give the "job creators" more and more.

[limpyhobbler]

4. we need this.

Headline sounds like Democrats support this, but is it really just a few Senators?

[octoberlib]

7. That's the question. The article didn't say.

The usual Dem suspects probably won't vote for it. Baucus et al.

[pampango]

5. Since much of Europe is adopting a financial transaction tax now (Germany and France, not the UK),

this would be a great time for the US to go the same route. If most developed countries to this at about the same time, the argument that we will lose business to X, Y or Z country loses much its usefulness.

[MrYikes]

6. This is FOR the people.

Now let us see who in government stands with us.

[kentuck]

8. Actually, it's a cowardly amount

Considering what the market has taken from the people.

[corkhead]

9. I think we're supposed to be content that at least they talked about it, even though it won't happen

Repukes will block it in the senate, so this is just blowing smoke up our asses.

4 more years of obstruction of things just like this.

[BlueCaliDem]

27. ^^^This!^^^

That's why they had to leave the filibuster alone. They - the elites in Congress on both sides of the aisle - need to make us believe there are two parties in Congress while they scratch each other's backs, pass legislation that mostly helps the wealthy and the corporations, and stick us with the bill while trying to kill Social Security, Medicare, Medicaid, food aid, Meals on Wheels (those poor, old people are a drain and should really die off), subsidies for home heating oil, etc.

We are being taken for an expensive ride and Congressional Dems are part of the problem. This is why President Obama couldn't get single-payer (although he never ran on it, I'm pretty sure he wanted it), or an open public option, or helping homeowners who were losing their homes, or ensuring that Gitmo is closed.

[xxqqqzme]

28. That was my theory as well.

Ed Shultz said reid's cave-in was about the guns. I thought nope, it's about the money. It is always about the money.

[Dragonfli]

10. A chance for the silent virtual filibuster to do it's holy work.

Just as Mitch (and also Harry) intended!

Should we cheer the filibuster when it happens?
I am so excited!

[Demo_Chris]

11. Why not 5% or so?

If a sales tax like this is good enough for regular folks it aught to be good enough for the wealthy.

Also, tax cap gains as income. ALL of them. We've got bills to pay and a society to fund. o/

[truedelphi]

13. It's on each and every transaction related to stock market trading.

Since many stocks don't succeed in getting a five percent return, it would be a deal breaker.

[Demo_Chris]

23. It would certainly slow volatility wouldn't it

I don't see the problem.

[Egalitarian Thug]

17. That high a tax would allow us to eliminate virtually every other federal tax.

OTOH, it would push a lot of companies out of the stock market altogether. I'm not sure that would necessarily be a bad thing, but it would significantly alter the nature of trading.

[Demo_Chris]

24. Yes

And if it pushed investors into other types of investments -- like business or whatever -- good deal.

[sulphurdunn]

12. Republican

state legislatures have instituted rigged gerrymandering on a massive scale to ensure their majorities despite the will of the electorate. Now they are moving to rigged proportional voting for President. At the federal level they have managed to create a minority veto for themselves. They know that the time has passed when they win popular elections by majority vote. The may not have the votes to stay in power, but they do have money and crooked pols.

[Fight2Win]

14. great idea!

We should also end wall street speculation on our food and oil, Koch and Goldman Sachs have been making a killing while people are dying.

[FailureToCommunicate]

15. For anyone worried that such a tax will hurt Wall Street or banks...(Or Bill Nighy fans)

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[Sherman A1]

16. K&R

[abelenkpe]

19. nice idea

how can this pass though with no filibuster reform?

[judesedit]

20. Let's hope Congress votes with their integrity and not their love for their owners' $$$$$$

[99th_Monkey]

21. YES! This is 110% the right thing to do. 80% of voters will love you for it. JUST DO IT!!! nt

[DrewFlorida]

22. This is a great idea, it's helps to solve two problems.

It holds the financial industry accountable for the damage they caused to the markets, and at the same time reduces the number of speculative short term trades made.

[airplaneman]

25. I would do a 1% tax on all stock and derivative trades including funds.

This would generate about 3.2 trillion dollars a year. 0.03% is way too low. Maybe exempt the first 10K per year per individual to help the little guys out. Look at your 401K the fund managers take 2-5 percent out every year weather you make money or not and weather you buy that year or not. I would also have a government run 401K where they take out 1% a year versus the almost 4% average of fund managers. As it is now in 20 years you get $100 and the fund manager gets $80.00. Under a government run program you get $160 instead of $100 and the government gets $20 as taxes. Mostly the rich own stocks and they make huge profits tax free in a lot of cases. Companies like JP Morgan know how to skim stock so they make a bundle and the little guys make little or losses. Its a rigged game if you really look into it closely.
-Airplane

[elleng]

26. As Europe is going with it, 'elsewhere' shrinks.

'Critics of the Euro-wide turn to a transactions tax say it could slow down growth and encourage businesses to move elsewhere, and similar claims have been made about the American version.'

PLEASE 'slow down high-frequency trading.'

[reteachinwi]

29. "Financial transaction tax?"

http://dailybail.com/home/warren-buffett-no-one-can-stop-too-big-to-fail.html

[stocktax]

30. Trading Tax Won't Reduce Volatility

The senators are drowning in their own ignorance. High-frequency trading has significant value. It increases liquidity, which reduces investing/trading costs. Volatility has increased because of the reduction in liquidity. Liquidity has declined because markets have become fragmented as regulators have allowed the number of exchanges to increase. In addition, the growth of dark pools has significantly decreased liquidity. If the senators want to decrease volatility, then they should work towards increasing liquidity by encouraging more trading to take place on the major exchanges.