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Its time to tax financial transactions
Key Excerpts from Article on Website of Washington Post


Washington Post, March 5, 2013
Posted: March 12th, 2013
http://www.washingtonpost.com/opinions/katrina-vanden-heuvel...

On Friday at midnight, the sequester kicked in, triggering $85 billion in deep, dumb budget cuts that sent nonessential personnel such as air traffic controllers packing. Not to worry, though: Wall Streets day was pretty much like any other. Billions of dollars in profits were made off of trillions of dollars in financial transactions. And the vast majority of those transactions were conducted tax-free. We dont need a team of policymakers to tell us this isnt good policy, or that it needs changing. Policymakers propose exactly that: a change. Sens. Tom Harkin (D-Iowa) and Sheldon Whitehouse (D-R.I.), along with Rep. Pete DeFazio (D-Ore.), unveiled a bill that would place a light tax on all financial transactions three pennies on every $100 traded. Its so small, Wall Street could easily afford it and the average E-Trade investor would barely notice it. This insignificant tax raises a significant amount of revenue $352 billion over the next 10 years, or enough to refund about one-third of what the sequester will slash from the federal budget. The high-frequency traders that now dominate our markets would be hardest-hit by the tax. Analysts fear that such mass trading strategies could lead to disaster if markets behave unexpectedly. The new tax would discourage these kinds of trades, which would be a good thing. Europe, at least, seems to agree. Eleven nations, led by the conservative German government, are on track to start collecting the tax by January 2014. Expected revenues: $50 billion per year.

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