A Wall Street Tax
The nation is now considering cuts to Social Security that would take away a week’s grocery money from elderly women, many already living at the margins. They will join some of the nation’s children eating less, as 10 percent of U.S. households with children are “food insecure” during the year, according to government data. Last month the percentage of men in the workforce aged 45 to 54 reached its lowest point on record. Cuts to housing subsidies are expected to add 140,000 families to the ranks of the homeless next year, on top of the growing numbers of homeless young adults. Sharp increases in risk of heart attack linked to unemployment are now being reported, as well as rising numbers of suicide attempts tied to foreclosures. Nurses see more children with stress disorders normally associated with the adult population. Children, young adults, middle-aged Americans and the elderly are linked together in a downward spiral.
That’s why nurses helped organize the U.S. Robin Hood Tax Campaign, now with more than 140 endorsing organizations, and are supporting the “Inclusive Prosperity Act,” H.R. 1579, reintroduced by Rep. Keith Ellison (D-MN) last week, legislation that embodies Robin’s goals and principles.
The Ellison bill is a small sales tax on Wall Street trading—0.5 percent on stocks, 0.1 percent on bonds and .005 percent on derivatives and other trades. This financial transaction tax (FTT) could raise hundreds of billions of dollars in revenue in the U.S. each year, a feasible amount that can make a very real difference.
The new revenue would serve the entire nation, creating millions of new jobs by rebuilding infrastructure and transitioning to a cleaner environment, providing quality healthcare and schools; subsidies for housing, child care, student tuition assistance and to secure the social safety net. The measure also calls for stepped up funding for international efforts in HIV/AIDS treatment and research and to address climate change.
For millions of Americans the recovery promised after the bank bailout of 2008 simply never materialized. But prosperity did return to the financial institutions made whole with our tax dollars. For them, last year was the second best on record, behind 2006. “We are the richest nation in the history of the world – richer now than we’ve ever been,” wrote former Labor Secretary Robert Reich last month. “But an increasing share of that wealth is held by a smaller and smaller share of the population….” The 1 percent owns fully half the country’s stocks, bonds and mutual funds. The bottom 50 percent, in contrast, own just 0.5 percent of these investments. The tax falls on those who can well afford it.
We all pay sales tax on shoes, school supplies and SUVs, but financial transactions remain untaxed. “Everyone shopping on Main Street today pays sales taxes when they buy things,” said University of Massachusetts-Amherst economist Robert Pollin. “It’s time for Wall Street traders to face up to similar obligations.” Pollin is one of the more than 1,000 economists who endorse an FTT, as do some of our nation’s leading business executives.
There are other very significant reasons to join Robin Hood in supporting H.R. 1579. The markets are dominated by high-frequency trading– some estimates put it as high as 70 percent of market activity. The new tax aims to put a brake on these trades, which have caused financial bubbles, market crashes and the sidelining of capital that ought to be put to productive uses. And the Ellison bill lowers costs in fuel and food, tied to speculation.
The Ellison bill protects average Americans, holding exchanges and brokers primarily responsible for paying the new sales tax, leaving sensible, long-term investors unaffected.
Economist Pollin and others underscore new revenue would serve to raise confidence in the economy overall and induce corporations to invest some of an estimated $2 trillion they are holding in their coffers, capital that would speed a national recovery.
The Ellison bill will add the U.S. to the ranks of nations already collecting financial transaction taxes. Twenty-three nations, and all the major exchanges outside the U.S., collect these taxes. (Americans trading abroad pay these taxes to the treasuries of other countries.) Next year, 11 European countries – France, Germany and Italy among them – will together institute an FTT. “There is now a historical opportunity for the international community to join forces,” wrote Philippe Douste-Blazy, Under-Secretary General of the UN this year. “The successful ‘Robin Hood Tax’ campaign shows that an FTT has enormous grassroots support around the world.”
The time is now for the U.S. to join these forces, support H.R. 1579 and let the national healing begin.
Deborah Burger, RN, is co-president of National Nurses United, the largest U.S. organization of nurses. NNU is a founding member of the U.S. Robin Hood Tax Campaign www.robinhhood.org.