Jim Hightower: A Financial Transaction Tax on High Frequency Traders

[eridani]

http://www.nationofchange.org/financial-transaction-tax-high-frequency-traders-1394023208

Have you heard about High Frequency Trading? Get ready to be dazzled! HFT is sweeping, purely speculative financial transactions that have been made possible by huge leaps in technology. Done by super-fast computers, using mathematical algorithms, HFT searches millions of prices at lightning speeds and places bets automatically. Transaction times are measured in milliseconds, as the global network of "trading robots" never sleeps, and its sole function is to allow the wealthiest speculators to skim quick profits out of markets.

Guess how much in taxes folks pay on the sales in the HFT game? When I buy a $3 pack of toilet paper here in Austin, Texas, I pay an extra 8.25 percent in sales tax. But if a high roller in the HFT game buys $10 million worth of corporate stock, he or she pays zero tax on the sale.

So maybe we need an FTT on HFT. A Financial Transaction Tax is not an idea whose time has come, but simply returned. From 1914 to 1966, our country taxed all sales and transfers of stock. The tax was doubled in the last year of Herbert Hoover's presidency to help us recover from the Great Depression. Today, 40 countries have FTT's, including the seven with the fastest-growing stock exchanges in the world. Seven members of the European Union voted for an FTT (including France and Germany) to help blunt rising poverty, restore services and put people back to work.

[Downwinder]

1. I have to pay sales tax. Why shouldn't traders?

[mbperrin]

2. Yes, tax each transaction. HFT is even less trading than usual and more

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