The G20 Summit was held in Cannes, Frances this week with the globalizing theme entitled, “Nouveau Monde, Nouvelles Idees,” which is to say “New World, New Ideas.” One idea that has been discussed for several years but never given serious consideration in the United States was presented by Bill Gates at the invitation of French President Nicolas Sarkozy. Bill Gates proposed that there should be “a small tax on trades of stocks, derivatives, and other financial instruments,” also known as a financial transactions tax (FTT), Wall Street speculation tax, or the Robin Hood tax. The funds raised from the FTT would be used to meet the needs of the poor.
Bill Gates stated that the “FTTs already exist in many countries, where they generate significant revenue, so they are clearly technically feasible. According to the IMF, 15 of the G20 countries have some form of securities transaction tax. In the seven countries where the IMF estimates revenue, these taxes raise an estimated $15 billion per year." Fifteen billion is a lot of money and would go a long long way towards relieving the suffering of many Americans who find themselves living in the aftermath of the financial crisis. For example, the money could be used to provide housing for thousands of Americans who are homeless as a result of foreclosure. The money could be used to create jobs for thousands of unemployed Americans whose companies were forced to let them go as a result of the double dip recession. The money could be used for educational programs to help re-tool the unemployed for jobs in growing sectors. The money could be used for food programs to feed children and adults that are unable to purchase food because there is not a steady source of income in the family or to develop urban farming programs where familie can grow fresh fruits and vegetables. The money could be used to provide healthcare to the uninsured because health care is a benefit of employment and if one is unemployed it is almost a certainty that one will not have health care. The money could be used for ….
However, I am intrigued as to why Congress has not adopted some form of FTT legislation. We seem to have a tax for everything else such as an income tax, property tax, sales tax, capital gains tax, so why not a financial transactions tax to fund programs for the poor? Perhaps it is time for a revamping of old ideas into new ideas that are designed to address specific harm or inequity especially when Wall Street’s mishandling of certain financial transactions is the proximate cause of such harm or inequity. Perhaps this is an idea whose time has come.
Lydie Nadia Cabrera Pierre-Louis