Robin Hood of Sherwood Forest that celebrated legendary “good guy” of old who robbed the rich to give to the poor was certainly no friend of government if I remember the story correctly. He was constantly dodging the nasty sheriff of Nottingham who wanted him hanged.
But now it seems that the government has adopted the essence of Robin Hood with open arms; in fact, the government has become the modern times Robin Hood. Taking from the rich to give to the poor is the standard government philosophy in America and all over the world these days.
While Democrats and Republicans bicker about ways to increase revenue for the government coffers they all agree that a great way to do it is to take from the people they think are responsible for the present day financial crisis; those who finance American growth by trading in stocks and other securities in the financial markets.
You know – those “greedy Wall Street speculators.” No politician will ever admit that it was the government which caused the financial crisis, not the free market participants. It’s the government that controls the economy; the government that spends the money; and the government that makes up the rules.
So what better way to punish the innocent free marketers and raise revenue at the same time than creating a “Robin Hood tax?” It’s the government’s latest idea about how to rob the rich. Naturally, it has the complete backing and approval of the labor unions as well.
It would supposedly impose a tiny three-hundredths-of-a-penny tax on financial trades, an amount that seems like a pittance now, but once instituted could easily go much higher. Supporters say the tax would cost the average investor just $1 per year, but could generate up to $35 billion annually from the high-stakes, high-volume high-speed computer trades critics claim increase market volatility.
Big deal; Government spends that kind of money every few minutes.
"It would benefit long-term investors with stability," Rep. Peter Defazio, D-Ore., said. "It would benefit the economy with a longer-term perspective on investing, and it would reward patient capital as opposed to this useless daily second-by-second, millisecond-by-millisecond churning that goes on."
Defazio is an example of a critic who doesn’t understand the financial markets. Those high volume traders he derides are the market makers; the ones who make the markets work; the ones who provide the market liquidity which allows the average investor to find buyers and sellers for his security within seconds.
Opponents of the tax insist it would not eliminate high-frequency traders but send them offshore to avoid the tax altogether. They also say it would hit mutual and pension fund trades, thereby affecting everyone.
"It's something that sounds good in theory, but it won't work in practice and instead will actually cause great damage to the economy and in doing that it actually reduces the amount of taxes collected rather than increasing them," David John of the Heritage Foundation said. "This is something that will reduce jobs, move them overseas and reduce rates of returns for union retirement funds… This is something that has a real potential to do damage."
England already has a half percent tax on stock trades. The presidents of Germany and France support a global financial tax.
Of course they do. The statist governments of Europe never met a tax they didn’t love. And look where they are now.
It’s just more Robin Hood by government.