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I always wonder if bills like this one which radically alter the structure of our government are proposed in seriousness or merely as a distraction to please ce

I always wonder if bills like this one which radically alter the structure of our government are proposed in seriousness or merely as a distraction to please certain voters. Obviously, adding a 1% tax on all financial transactions, as this bill proposes, would drastically change how our economy operates. Keeping the markets efficient and accurately priced becomes much more difficult when any trade comes with a 1% cost. Especially when the 1% is imposed whether it results in a profit or a loss. From what I see in this bill, even selling one stock to purchase another would incur a 1% fee on the first sale and a 1% fee on the purchase of the second stock. 1% may not sound like much, but as money continues to change hands the government's take grows significantly. Let $100 change hands 10 times, and you're left with $90.44 of the original money. Let $100 change hands 100 times and you're down to $36.60. Of course this scheme would transfer money to the government to pay down our debt (in theory, if the money is used as the bill intends), but at what cost? This additional financial friction could seriously slow down the economy and disrupt efficient market pricing. Finding the proper balance of taxes, debt, and economy growth is a very, very difficult problem, and this solution is not well thought out at all. Furthermore, eliminating our national debt is not going to solve all of our problems, as many would like us to believe. Throwing ridiculous bills like this in the mix only serves to muddy the waters. It distract us from the real problems and the potentially viable solutions. Let's make small, incremental changes within our current tax structure to fix our problems in a reasonable manner.

devmonk 16y ago
Let's make small, incremental changes within our current tax structure to fix our problems in a reasonable manner. What would you propose that would eliminate most of our debt in a reasonable manner that congress and the people would back?
hga 16y ago
Forget about friction: how much money would this really bring in? Some time ago I read that Switzerland instituted a stock market transaction tax ... and their market quickly lost a very large fraction of its business. US based multi-nationals would e.g. follow all those oil services companies that have moved their headquarters outside of the country (curiously, to Switzerland (and note that this happened before the BP spill)). Obviously there would be a mass exodus out of instruments that are taxed in this way. People and companies would game the system like mad, descend upon D.C. for exceptions for their "critical" industries, etc. etc. And destroying or chasing out of the country a large fraction of the US financial sector---which all too many people unwisely desire---could easily result in a net loss to the government, especially when you count secondary effects like a decreased ability to raise capital and vastly less efficient capital markets. My favorite not so quick fix is the government selling off a very large fraction of the land it owns. What's the compelling reason for it owning this much of these top ten states I just randomly found on the net: 1. Nevada 84.5% 2. Alaska 69.1% 3. Utah 57.4% 4. Oregon 53.1% 5. Idaho 50.2% 6. Arizona 48.1% 7. California 45.3% 8. Wyoming 42.3% 9. New Mexico 41.8% 10. Colorado 36.6%

devmonk 16y ago

Let's make small, incremental changes within our current tax structure to fix our problems in a reasonable manner. What would you propose that would eliminate most of our debt in a reasonable manner that congress and the people would back?

hga 16y ago

Forget about friction: how much money would this really bring in? Some time ago I read that Switzerland instituted a stock market transaction tax ... and their market quickly lost a very large fraction of its business. US based multi-nationals would e.g. follow all those oil services companies that have moved their headquarters outside of the country (curiously, to Switzerland (and note that this happened before the BP spill)). Obviously there would be a mass exodus out of instruments that are taxed in this way. People and companies would game the system like mad, descend upon D.C. for exceptions for their "critical" industries, etc. etc. And destroying or chasing out of the country a large fraction of the US financial sector---which all too many people unwisely desire---could easily result in a net loss to the government, especially when you count secondary effects like a decreased ability to raise capital and vastly less efficient capital markets. My favorite not so quick fix is the government selling off a very large fraction of the land it owns. What's the compelling reason for it owning this much of these top ten states I just randomly found on the net: 1. Nevada 84.5% 2. Alaska 69.1% 3. Utah 57.4% 4. Oregon 53.1% 5. Idaho 50.2% 6. Arizona 48.1% 7. California 45.3% 8. Wyoming 42.3% 9. New Mexico 41.8% 10. Colorado 36.6%