Imagine—just imagine—if a tiny, barely noticed tax on Wall Street could solve many of our nation’s problems. Well it can!!!!!!!!
It’s the most wonderful Congressional Budget Office “Options For Reducing The Deficit: 2019 to 2028" time of year!!!!!!
Ignore the name of that report, immediately. What we really have here are financial projections from the nonpartisan CBO about a range of things that Congress could do that could conceivably be used to reduce the deficit. Of course, these various ideas could also raise tax revenue that could be used to fund public health care or reduce inequality or bolster Social Security or build infrastructure or a million other things. It is a menu of things that Congress could pull from, if Congress were into the concept of taking a careful, research-based approach to budgeting grounded in moral philosophy, which Congress is not.
Anyhow, I encourage you to peruse this report if you are curious about the dollar impacts of Raising The Age of Eligibility for Medicare to 67 or Eliminating Supplemental Security Income Benefits for Disabled Children. (Actually if you are very interested in those ideas, I hope you can’t read.) But for the purposes of this blog post let’s focus on one idea that has long been advocated by people across the ideological spectrum who have a good grasp on the ways that the unfettered growth of Wall Street has been deleterious for our society as a whole: A tax on financial transactions.
More than a trillion dollars of stocks and bonds are traded each day in the U.S. The CBO runs the numbers for a theoretical 0.1% tax on the value of each financial securities trade—a tax that is low enough to have little impact on the routine conduct of financial transactions, but which would have the side benefit of drastically cutting down on high-frequency trading, which adds very little value to capital markets and itself functions as a tax on everyone that goes into a few rich peoples’ pockets.
So how much would this tax on Wall Street raise? Even accounting for certain other revenues that would go down as a result, The CBO says that “This option would increase revenues by $777 billion from 2019 through 2028.”
In other words, you could raise nearly $80 billion a year over the next decade with a small tax that is well-targeted to the investor class, and which would have the salutary effect of discouraging a practice that already serves to rob the public. To give just one example for context, you could fund virtually the entire federal food stamp program with this financial transactions tax.
SOUNDS LIKE A GOOD FUCKIN IDEA.
[The full CBO report, via Lily Batchelder. Please do not write some dumbass comment without first scrolling to page 298 of this report and reading the entire section to see if your dumbass objection has already been accounted for. Thank you.]