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If Robin Hood stole from the rich, is a “Robin Hood Tax” a form of theft?
A “Robin Hood Tax” is based on the idea that the financial sector is too large and should be taxed more to pay for social services. The most popular form of this proposal is a financial transactions tax, levied on “transactions like stocks, bonds, foreign currency and derivatives.” The young man in the video above seems to peg his proposal at a 0.5% fee.
This is a fundamental misunderstanding of what ails the economy. Kenneth Rogoff, an economist at Harvard, lays out the obvious case: when you tax something, you get less of it.
Such taxes surely reduce liquidity in financial markets. With fewer trades, the information content of prices is arguably reduced. But both theoretical and simulation results suggest no obvious decline in volatility. And, while raising so much revenue with so low a tax rate sounds grand, the declining volume of trades would shrink the tax base precipitously. As a result, the ultimate revenue gains are likely to prove disappointing, as Sweden discovered when it attempted to tax financial transactions two decades ago.
Financial transactions taxes have been more popularly proposed in Europe, and even elected Democrats have been hesitant to embrace these forms of “Robin Hood” taxes. Thankfully, the U.S. hasn’t succumbed to such appeals to emotion.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?