Securities Transaction Tax: Wrong Idea at the Wrong Time

In an Op-Ed column in this morning's New York Times, columnist Bob Herbert proposes a 0.25% transaction tax on all securities transactions.  Mr. Herbert writes that, "the fees would raise a ton of money, perhaps $100 billion or more annually."  And exactly where would all that money come from?  Who cares, right?  Mr Herbert goes on to say that while the expense would be trivial for individual investors, they could "amount to a big deal for speculators." 

Once again, it all comes down to the evil speculators.  Without even getting into why the majority of this tax burden would end up being borne by the general public, do we really want to put regulations into place that discourage any of the remaining liquidity in our financial markets?

Click here to subscribe to Bespoke Premium today! 

Comments

[dj]

This is a good idea,after all there killing us with zero % saving rate,now lets turn the knife abit......after all must save the upper class-"let them eat cake"

[Eric]

This is one of the worst economic policies the government could pursue.

Few people understand the role of traders and investors. They exist to allocate resources! They are paid when they do it correctly. Discourage investment in the U.S. (on any time frame) and those investors will simply allocate their resources elsewhere.

That an economist of any influence thinks it's a good idea to tax investment is absolutely astonishing.