Obama and his minions continue their attack on capitalism. Scheming with the ACL-CIO, democrat politicians seek to impose a tax on investment firms that earn billions of dollars in profit through high-frequency trading.
From The Hill :
The nation’s largest labor union and some allied Democrats are pushing a new tax that would hit big investment firms such as Goldman Sachs reaping billions of dollars in profits while the rest of the economy sputters.
The AFL-CIO, one of the Democratic Party’s most powerful allies, would like to assess a small tax — about a tenth of a percent — on every stock transaction.
Small and medium-sized investors would hardly notice such a tax, but major trading firms, such as Goldman, which reported $3.44 billion in profits during the second quarter of 2009, may see this as a significant threat to their profits.
How, exactly, does imposing a tax on profitable Wall Street firms benefit AFL-CIO members? And why is a labor union involved in tax policy?
Thea Lee AFL-CIO policy director, says the tax would have two benefits.
“It would have two benefits, raise a lot of revenue and discourage speculative financial activity ,” said Thea Lee, policy director at the AFL-CIO.
What’s wrong with financial speculation? Isn’t capitalism and a free society based on speculation? What is an entrepreneur doing when they start a business and employ those who can offer only their labor, isn’t that speculation? There are no guarantees of success. The entrepreneur is at risk of losing their capital.
Liberals are furious that anybody, except the 100% profit government industry, is not being crushed by the recession they induced.
The proposal would hit especially hard those hedge funds and large banks earning hefty profits despite the shaky economy from a practice known as high-frequency trading. High-frequency traders use powerful computers to conduct hundreds of thousands of orders in mere seconds, taking advantage of slower traders.
Liberals are angry the company, which immersed itself in the frenzy of speculation leading to last year’s financial collapse, is now making huge profits after accepting (and repaying) $10 billion in government aid. Goldman employees are on track to earn an average of more than $700,000 this year.
If you didn’t want them to be profitable, why loan them the money? They should have been allowed to fail. That way liberals wouldn’t have to be angry and Goldman couldn’t earn their profits.
Rep. Peter DeFazio (D-Ore.), chairman of the Highways and Transit Transportation Subcommittee, has a better idea. Let’s tax commodities speculators.
“The tax is simple; it imposes a small burden that penalizes short-term traders for speculating on the price of oil,” DeFazio said in a statement. “This legislation exempts legitimate hedgers from the transaction tax. Since the tax is on speculation only, it deters speculation and undermines much of the crude oil price bubble .”
Wrong congressman, if you want to prevent bubbles, first, take an economics course, second, cut spending and third, stop printing money.
“Then Jesus said to the crowds and to his disciples: But do not do what they do, for they do not practice what they preach.””they tie up heavy loads and put them on men’s shoulders, but they themselves are not willing to lift a finger to move them.”-Matthew 23:1-4
God help us!