Labour pushes Democrats for a Robinhood Tax


10:00 am - February 27th 2013

by Owen Tudor    


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I’m back from a 48-hour round trip to Washington DC with Shadow Financial Secretary to the Treasury Chris Leslie MP, and it was really interesting to see exactly the same debates about a Robin Hood Tax being had in the USA as we’ve had in the UK.

EU Tax Commissioner Algirdas Semeta spent longer in the US, making the case for the 11-country EU financial transactions tax in New York as well as Washington.

The two visits were designed to promote the EU transactions tax in the US, and inch both the US legislature and executive, and the UK, towards joining the EU’s initiative, so it’s good news that this week, Senator Harkin and Rep deFazio are re-introducing their “Wall Street Trading Tax” in Congress.

Their letter to other members of Congress seeking support for the tax quotes Nobel prize winning economist Paul Krugman and AFLCIO President Richard Trumka, but also former Chair of the Federal Deposit Insurance Corporation Sheil Bair and John Bogle, the founder of Vanguard, a huge mutual fund company.

Signs of support for an FTT are growing – the H-street based Center for American Progress itself, very close to the Obama White House, has never been so forthright in support. Commissioner Semeta said that when he had been in New York, UN Secretary General Ban Ki-Moon had expressed his support for the tax, and Wall Street bankers had been interested more in the rate than opposing the principle of the tax.

Chris Leslie’s presence was designed to open up a dialogue between the Labour Party and Democrats about how to co-ordinate their work on the issue, to deal with concerns about tax competition between Wall Street and the City of London, although such competition is more apparent than real, given the possibility of designing FTTs to prevent avoidance by moving jurisdiction.

There will be more transatlantic discussion as a result of his visit.

Chris Leslie recorded this interview after the seminar at which he spoke:

He said: “I don’t see any evidence that there would be a negative effect on economic growth. In fact, quite the opposite. I think if you did have a global financial transactions tax where all of the global financial centers were involved and it was also set at a rate that is pretty modest, it wasn’t going to have a distorting negative consequence, then you could raise revenues that would actually help promote growth and invest in job creation. And I think ultimately that’s one of the main arguments in favour of a financial transactions tax.”

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About the author
Owen Tudor is an occasional contributor to LC. He is head of the TUC’s European Union and International Relations Department and blogs more regularly at the Touchstone blog.
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Reader comments


“Britain pushing the USA”? What a sweet thought. Not since Suez.

Taking even more of my money and giving it to Government will help growth how, exactly?

By Britain, do you mean ‘the Labour Party’? Because there’s no official support for it that I can see in this article.

All this proves is Chris Leslie is either an idiot or is willfully ignoring the facts of an FTT (helpfully researched by the EU).

That Owen Tudor keeps pushing this myopic idea is no real surprise, but again, one could ask him if his political dogma precludes actual evidence.

The Swedes tried an FTT. It was an abject failure and was quickly removed – after sending much of Sweden’s finance industry overseas. I kind of hope parts of Europe also try a similar thing, if only to show how little revenue it will raise and how much damage it will cause. Then hopefully the whole issue can be put to bed permanently….bar Owen Tudor types who will then insist it only failed because it wasn’t global

@ TimJ

No – he means the TUC. But given they fund the Labour party heavily, it’s probably them making the puppet jump.

A Robin Hood tax on financial speculation would represent the final triumph of finance capital over UK society. It would turn the entire British population into speculators and opportunists dependent for their hospitals and schools on the City’s ability to screw the third world by swapping commodity derivatives and other counterfeit claims on global wealth. It may be Robin Hood domestically but internationally it would be entirely Sheriff of Nottingham.

The bankrupt City needs to be closed down not encouraged before the entire UK economy has been liquidated to bail it and its billionaire gambling creditors out.

As I’ve said before. Wouldn’t it be a good idea to see if the FTT works before extending it?

@ David Ellis

Good point, since FTT is a percentage of the cream skimmed off by the 1%, logically it means the 1% will skim even more off…

Wouldn’t it be better to have negative interest rates on accumulated capital. Unless it is actually put to work through reinvestment?

Tim Shipman advocates killing disabled, poor and Tyler is still a tory inbred.

https://twitter.com/ShippersUnbound

@ toryisinbred

Are you saying that Tim wilfully ignores the fact that his billionaire bribe masters are the ultimate freeloaders lol

@ Toryisinbred and Dissident

I’m not against the FTT because it is a TUC/Labour idea.

I’m against because it is a window-licking stupid idea.

Banks *WILL NOT* pay this tax. They will simply pass the cost on. Consumers will.

As I have described before, the tax will fall primarily on pension funds and their returns, and for borrowers – specifically mortgages. Nor will the extra cost to the end user be 0.01%. It will be a massive multiple of that (1-2% on a 20 year mortgage).

The other thing the proponents assume is that the government will get more money (which they won’t, according to the EU paper) and it will be good for growth (again, the EU paper says an FTT will reduce grwoth). This is in spite of all the evidence to the contrary. Which makes me feel some people are being will fully blind with an ulterior motive, or are simply acting out of spite.

That ulterior motive is pretty easy to ascertain as well – it gives the EU their own tax base which isn’t reliant on member governments. A lot of Eurocrats are very much in favour of being able to do away with budget negotiations.

@7

But if it was suggested that it be tried on a small scale, people like you would tell us not to do it because it wont work unless everyone did it.

Labour should not wait for the US.

Labour should promise then do it.

The EU are already on board.

14. La Chupacabra

@ 13. BenM

‘The EU are already on board’

Actually 16 out of the EU’s 27 member states are NOT on board. Only a minority fraction of the EU is really interested in this.


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