Monday, January 11, 2010

Get Our Money Back!

While we're looking for good populist ways to go after the banks before the 2010 election, can we bring back the idea of a financial transactions tax? It's particularly suited to a political moment where the nation is hurting economically and banks are making big profits. The rhetoric is really simple -- the banks blew up the economy, we saved them, now they're making huge profits, and we're gonna get our money back. (We did make some money off TARP repayments from healthy firms, but from what I've heard we'll still have a big loss on AIG.) Swing voters aren't feeling much solidarity with the financial sector right now, and all the Republican moaning about tax increases will fall on deaf ears or worse since it's tax increases on Wall Street.

It's solid on policy grounds as well, discouraging speculation, having good distributive impact, and raising much-needed revenue. If there's some kind of worry about timing and it'd be best to do this after the economy recovers (I don't see that this is the case, given profits in the financial sector) we can delay it a little.
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