Bankers bonuses of £7billion - that's just their bonuses!!! Taxing the bankers bonuses makes sense economically, environmentally and socially - see a short youtube graphic that illustrates the point here with what else we could spend that money on. Let's not also forget that banks are being subsidised by us - see my blog post and link to an excellent video here.As I said in an earlier post 'Bankers: morally corrupt?' shows how a few changes could save us from having to make these cuts.
In one piece of good news I was delighted to hear that the European Parliament has just reiterated the call for the introduction of an EU-level financial transaction tax, as part of a report on innovative financing adopted by MEPs.
Keith Taylor, the Green MEP for South East England spoke in parliament this week to highlight the work of the Robin Hood Tax campaign and to urge MEPs to vote for the tax. MEPs voted in favour of introducing a tax on financial transactions.
The Greens have long called for the introduction of a financial transaction tax and welcomed the vote - those interested can also show their support to the campaign by going to the Robin Hood Tax campaign website and joining the 82,000 plus signatures.
Keith Taylor commented: "Greens have long championed the introduction of a financial transaction tax, both as a means of curbing harmful speculation and as a new source for generating public revenue. Public austerity is biting deep yet banks have billions to spend on bonuses and tax avoidance. The Robin Hood tax is both a potentially significant source of revenue and socially just. The tax will also serve as a disincentive for risky speculation, which was partly responsible for the banking collapse in the first place. It is time for the Commission and member states to stop stalling."
Jean Lambert MEP, who will be talking in Gloucester next month, added: “The financial transaction tax represents an excellent opportunity to find funds necessary to support essential projects threatened by the current economic situation, such as those designed to tackle climate change."
Meanwhile our major banks are refusing to tell the Financial Services Authority how many of their staff are paid more than £1m. Hector Sants, chief executive of the City regulator, told the Treasury select committee that "four of the larger banks" were not complying with his request to provide more information about how their top bankers are paid. He did not identify the banks.
See also here the videos I put together re Tax Havens talk we had in Stroud earlier this year.
2 comments:
The supporters of a Financial Transactions Tax are so stupid even the ones who are doing so out of the worthwhile motivation of trying to rein in harmful unregulated financial activity do not realise that the Tobin Tax
specifically targets the CURE and the FUNCTIONING MARKETS, rather than the problem and the problematic markets.
The problem is mispricing and illiquidity. The solution is effective, continuous repricing, which is accomplished through high frequency trading. When that happens, people do not accumulate massive positions whose value is suddenly repriced: the repricing occurs continually,those markets will have already responded dynamically.
The Tobin Tax specifically penalises markets that reprice in a timely fashion.
If intervention is needed, it is needed to address those markets
which DON’T turn over a high rate of transactions – those markets where the price discovery mechanism is opaque rather than transparently continuous and automatic.
Imagine if the illiquid market in mortgage derivatives had been
subject to the kind of high turnover, high liquidity trading that we see in the currency markets. Those instruments would have been repriced far earlier, far more efficiently.
Look at the pound: the market has been giving feedback for a while,
has been sending distress signals, deterring overinvestment in the pound and demanding action. If the value of the pound had been unresponsive to fundamentals of our crazy public finances, if it had stayed high,then people would have continued to overallocate into the pound and the fundamentals would have continued to deteriorate until the wheels fell off, a la what happened with mortgage derivatives.
If a financially literate Intelligent Being had been asked to devise a fiscal or regulatory response to the credit crisis that was most specifically designed to damage the system, to cut away the meat, to leave the rotten aspects alone, to alienate the cure and to increase the chances of problems in the future, a Tobin Tax would have been the precise answer.
No where near the stated amount would be generated per year smart money will move offshore the amount liable to tax all round will decrease and we will end up with less - it will have a large effect on us all. Unless you be believe Britains contribution to the EU can triple and investors/traders will have no problem funding that as well as paying stamp duty on top?
Good luck.
Tobin is not the answer - we need much more fundamental reforms but I think it is a useful (and possible) step to change the way we do finances - and raise some money
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