To avoid the “fiscal cliff,” tax all Wall Street transactions

A sales tax on all Wall Street transactions would generate a ton of money — after all, those transactions generate a ton for Wall Street in fees. To solve a big chunk of the impending “fiscal cliff” budget cuts the federal government needs to do is make like Groucho and say, “Clip me off a piece of that.” And as the video below explains, a great many countries in the world, including the U.K., do exactly that. We’ve even done it (Hartmann at 2:00 in the clip).

The point here — that Wall Street put us here by crashing the economy, and they should be made to pull us out — is exactly right. And the solution — place a sales tax on Wall Street transactions — is perfectly appropriate.

Listen to Mike Papantonio and Thom Hartmann as they discuss this; great short clip.

I’ve said before that the so-called “fiscal cliff” is really a Fiscal Bluff, a poker game — and at heart, a huge “I dare you to stop me” looting scam —  and Wall Street is one of the major perps. It’s this same billionaire class that’s driving the discussion, not just joining in.

Oddly (or not), the role of the billionaires class in ginning up this phony “fiscal cliff crisis” is missing from the media. But because the billionaires also own the media reporting on it, the no-tell policy makes perfect sense. (And if that makes it sound like the media is a propaganda arm of its owners, you get a prize. Exactly right.) Papantonio discusses the media role at 2:50.

Finally, a piece that isn’t mentioned here — that both “fiscal cliff” and “Fix the Debt” is a billionaire and Wall Street op — is just icing on the obvious.

They really are the perp; they really ought to pay. And we really ought to be saying so. Consider this a start. Thanks, Thom and Mike, for saying so.

GP

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Gaius Publius is a professional writer living on the West Coast of the United States. Click here for more. Follow him on Twitter @Gaius_Publius and Facebook.

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  • samizdat

    Hmmm…A Contract for America, only with sane, rational, useful, and proven effectiveness of ideas built in.

  • samizdat

    Fluffers. Couldn’t have said it better. The Democratic Party is dead. Irrelevant, precisely because–amongst numerous other reasons–every time the Dims argue for something, they always go for the lowest common denominator tactic. Every time. As you say, they should be setting the bar so high the effin’ ‘Pukes get a nose bleed just from looking at it.

    Unfortunately, the likelihood of the Dims changing there spots–in some cases–or rejecting their current morally bankrupt ways–in most–is about as likely as Nancy Pelosi reversing her facial surgery.

  • Butch1

    Although, I prefer your definition better.

  • A reader in Colorado

    No one ever gets what they want until they’re willing to outright ask for it, despite the slings and arrows and hoots and mocking and “you’re mad” from the media.

    In fact “you’re mad” from the media is a PLUS. Because the very next step is, “well, let’s look at this for a minute”.

    Just remember: The far, far right is not afraid to do this, and it has gotten a lot of what it wants, despite public condemnation. The far right asked for creationism in schools, tax vouchers for religious schools, persecuting gay people in the military, prayer in public schools, explicit religious tests, federal funding for explicitly religious charitable activities, and to persecute abortion providers.

    As a tiny sliver of the population, 20% and falling, they’ve gotten farther than anyone could ever imagined. Sure, they’ve been pushed back on some things, but look at what they’ve accomplished. They’re disgusting accomplishments from my point of view, but that doesn’t take away from the idea that they are accomplishments..

    We of the left do not ask for enough. We need to be talking about LOWERING the retirement age. We need to be talking about seventy percent top rates on the rich, not fighting for the paltry 39% the Democrats are. And we need to be again demanding single payer, not a public option. And all these things should be part of a package.

    And it should be wrapped up in a very nice Christmas package complete with a little red bow, for the express purpose of drawing “you’re mad” from the media!

    Because when the Democrats deliberately act as the player on behalf of the left, and they set the floor at such a ridiculous level, then don’t get what they even started out with, it’s a setup.

    And another thing: It’s going to be a long hard slog, but we need to persuade our friends to give up the delusion that the Democrats represent us when it comes to policy and that we’re all part of the same team. We’re not. The Democrats are acting in the form of dastardly broker. They’re not playing for us, and they want their cut for deigning to represent us, with or without our permission.

    Elections aside (we can disagree about that with our “friends”) the Democrats are not the left, not friends of the left and do not have the left’s interests at heart at all. We need to start acting independently of the Democratic Party especially when it comes to policy.

  • ezpz

    Love it!

  • http://www.rebeccamorn.com/mind BeccaM

    It’s a great idea. It would slow down high frequency trading and speculation. It would raise tens of billions of dollars for the gov’t. It would be extremely progressive as taxes go, because the poorest usually own no stocks and the middle class, while they’re likely to have some in the form of retirement savings, don’t engage in frequent trading. The bankster class would get hit harder, and deservedly so, although given the proposals are for a tiny fraction of a percent in taxes, they’d barely notice it.

    Moreover, many other countries already have this tax and they’ve already proven it does all of these positive things with virtually nothing negative.

    It’s a fantastic idea. And it would be popular.

    Therefore, we here in America cannot ever, ever, ever, EVER have it.*

    (* = see also: Public option health insurance, Medicare for All, leaving SS/Medicare benefits alone, cutting the Defense budget, ending all the wars, restoring progressivity to our tax code, and much more)

  • A reader in Colorado

    Well, when you put it like that.

    I agree with a financial speculation tax, but I wonder what’s with all these piecemeal recommendations. Are the so-called Progressives not up to the job of creating a genuine package of reforms? Are so called progressive Democrats so weak, so disorganized, that they take tiny one issue potshots at this whole thing?

    We need to raise taxes on the wealthy, raise the capital gains tax, raise the estate tax, create a financial speculation tax, eliminate the FICA cap, close more than half of our overseas bases, cut the U.S. military, end the war in Afghanistan, and, oh, end the ban on negotiating for prescription drugs, end the war on drugs, end the overseas tax havens for corporations, stop rewarding outsourcing in the tax system and stop rewarding big oil.

    Why is there no proposed Progressive Budget Solution? It’s about the only way to get the attention of the media for one thing, who will look at a financial speculation tax, snort, and move on. But, for sheer audaciousness, a liberal contract like document, complete with savings projections, would be taken up.

  • Naja pallida

    That might catch on more than ‘traitorous assholes’.

  • Papa Bear

    Hmmm — Republicans and Republicrats?

    Just throwing that out there to see if anybody else thinks we should rename the blue dogs…

  • Butch1

    They are completely in the pocket of the corporate powers that be. They only pay lip-service to their constituents when they come up for re-election. Then they lie to get back into office. Then? Business as usual.

  • lynchie

    We have to get rid of the myth that our congressmen vote in our best interests. If that were so we would have a compassionate congress who truly care for the poor, elderly and less well off. Instead of that we have a congress which can find trillions of our money to bomb the shit out of some little brown or yellow folk but no money to provide health care or a living wage or some security in your old age. They want us to work until we die on the job and even then our families give up any right to our SS, which is money we had deducted from our pay checks for 20 or 30 or 40 years. POOF! It is gone. When you look into the eyes of our Congress all you see are lies and deceptions and the piles of money waiting offshore for them to deliver for the 1%. Sorry for being so cynical but little these days give me any hope that this will EVER change.

  • Naja pallida

    Like anything else that makes actual sense, all Republicans would be against it, and about half the Democrats would line up with them.

  • silas1898

    This makes too much sense; so it will never happen.

  • Butch1

    If history repeats itself, I would say that was so. ;-)

  • Snaggletooth

    The law could be written any number of ways to avoid the pitfall you’re describing. It is not a reason to dismiss the idea.

  • lynchie

    Excellent point

  • lynchie

    all of them?

  • http://twitter.com/ptelder Kenneth Brown

    More than making them pay, a transaction tax would be a “market-based” solution to discourage the kind of high-frequency trading and speculation that helped get us into this mess.

  • http://twitter.com/ptelder Kenneth Brown

    Depends on the fund, but most of these proposals are for a *very* small fraction of the trade. The taxes on trades made by a fund that is supposed to be investing in any medium or long term bets would be unnoticeable. Firms that trade the same stock back and forth 5 times a minute, not so much.

  • Butch1

    Perhaps, it the transactions were over a certain amount of money. That might eliminate many 401K accounts, etc. Just a thought.

  • Butch1

    I think it’s a great idea. How many republicans on the Hill would be against this? ;-)

  • lynchie

    Wait till the 1% hit this hard. They are the job creators, funny they have not created many since the Bush tax cut and are sitting on mountains of money. This is a great idea and the cost can be so miniscule that the few transactions the middle class makes (under $250,000) would not hurt us at all and it falls into the flat tax area where everyone shares pain equally, except when you are the 1% it is pocket change. I am for it.

    By the way I have not heard a peep from Obama, Pelosi, Reed, Geithner, Boehner, Ryan, Cantor about cutting the military. We have 800 bases around the world, do we need them all? Our bases in Europe can be turned over to those countries to manage, run, close and we can turn off that expense. We can save $500 billion a year easy and not have any reduction in our ability to defend ourselves. Why no mention? I guess the masters of Congress like the river of money that flows to them.

  • HolyMoly

    Perhaps an exemption on 401(k)/IRA activity? The tax could be narrower in scope and might still effectively reduce the deficit.

    Personally, I’m still in favor of simply returning the corporate tax rates to Eisenhower levels, but I think the idea expressed in this thread has some merit if tailored in a way that Average Joe’s investments aren’t going to take a hit.

  • S1AMER

    Yep, this would fill a big pot of money.

    But, like so many other “solutions,” it would also hit the middle class in a big way. Got a 401k at work, or an IRA if you’re self-employed? Got any mutual funds of IRAs at home? Still work for a company with a pension fund invested in stocks and bonds? Got any idea how often the fund managers trade shares in all these places you have money invested?

    Look, I hate Wall Street fat cats as much as anybody. I’d like to see them paying a hell of a lot more in taxes … but not by passing along to the IRS money they’ve extracted from my life savings.

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