As posted on the Drudge Report today, Democrat legislators will push for a transaction tax, one of the undeclared yet oft-spoken demands of the Occupy Wall Street gang.
“Senator Tom Harkin, an Iowa Democrat, and Representative Peter DeFazio, an Oregon Democrat, will introduce the bills tomorrow in their respective chambers. The bills will give the United States an increased role in the international debate over a transaction tax, which is likely to be discussed at the Group of 20 summit this week in Cannes, France.
“It’s a significant way to raise some needed revenue,” Harkin said in an interview today in Washington. “Quite frankly, I bet nobody would even feel it.”
I’m Republican and support this.
Well, not the bit about raising needed revenue, mind you. America has a spending problem, not a revenue problem. And for this jerk to predict nobody would feel it is patronizing.
But here’s why ALL Republicans who actually cherish capitalism should support a transction tax: This is not about taking money from the 1% but taking control of a criminal operation.
A stock transfer tax may be the only way to rein in the financial terrorism being committed by high-frequency trading (HFT) algorithms. Computers trade millions of shares for profits of tenths or hundredths of a cent, sometimes buying and selling in milliseconds. They move so fast, they can even beat live bids by a hundredth of a cent and beat the order within nanoseconds.
I’ve heard from real people who haven’t been able to buy stocks because every bid gets beat every time. A real customer looking to make a real purchase is no longer able to do so! And this phenomenon is occurring more and more.
New fiber optic cables are being laid at a cost of $200 million just to bump up the speed of HFTs from 500 nanoseconds to 300 nanoseconds. The difference of 200 nanoseconds is worth enough to make this real investment.
This is not capitalism — its a video game. Its a casino slot machine, rigged in favor of the computers. What’s worse, its making markets unstable. Zero Hedge often features smaller stocks plummeting literally vertical within one second, losing eighty or more percent of value, because hundreds of HFT computers calculated short positions, and they all acted at once! The Flash Crash of May 2010 was a case of HFTs going haywire, but really, it happens every day on a smaller scale.
So, anyone who calls this kind of practice “capitalism” is either a criminal or clinically insane. Its too far from the concept of building and investing capital, or even an enhanced financial instrument. Its a video game, online gambing, market rigging, value shaving, or what have you. It needs to be controlled…
Or, better yet, eliminated.
Putting a tax like this will take away the incentive to do HFTs, expecially if the tax specifies 1 cent for every trade profit less than a dollar and then 0.03% on every trade over a dollar.
Frankly, it would be impossible for HFTs to score a profit if every 1/100 of a cent shave has a 1 cent surcharge on it. HFTs will die, and the market manipulation by these vast computer networks will also fade away.
At the same time, moronic liberal progressives will have something to be happy about: a new tax on the wealthy.
And maybe at least some of them will shut up and give us a rest!