A Robin Hood for Wall Street
With the opening of the G20 Summit in Cannes, France today, an idea that’s been around for awhile is in the news again and gaining more attention as a result of the #OWS movement: The so-called “Robin Hood tax,” a minimal tax on all financial transactions with the resulting revenue dedicated to anti-poverty programs.
At the G20, the European Union will call for such a global tax, saying it “would aim to ensure that the financial sector makes a fair contribution to society.” In support of the proposal, U.S. labor unions are leading a demonstration outside the Treasury Department today, and AFL-CIO President Richard Trumka, along with other leaders, is in France to call for the tax.
Religious leaders are weighing in. Last week, in its statement on the economy, the Vatican’s Pontifical Council for Justice and Peace supported the idea, writing that “taxation measures on financial transactions … would be very useful in promoting global development and sustainability according to the principles of social justice and solidarity.”
Archbishop of Canterbury Rowan Williams, in his response to the occupation of St. Paul’s Cathedral in London, endorsed the Vatican proposals. Williams observed that ”people are frustrated beyond measure at what they see as the disastrous effects of global capitalism,” and urged a full debate on “a Financial Transaction Tax … or, popularly, a ‘Robin Hood Tax.’”
And in Congress, Sen. Tom Harkin (D-IA) and Rep. Peter DeFazio (D-OR) introduced legislation yesterday that would charge a .03 percent tax on non-consumer financial transactions, including stocks, bonds , derivatives, and similar activities. Sen. Harkin commented that “This trading tax would help raise necessary funds to invest in our infrastructure and the education of our children, among other priorities, and would do so without hurting job creation.”
Given the prominent role of reckless financial trading in helping to precipitate the economic recession of the past several years, such a tax might impose greater discipline on Wall Street. And the revenue generated could make a major difference in domestic and global poverty. With Wall Street executives back at full speed, taking home huge salaries and bonuses while the poverty rate continues to climb, it’s simply a matter of justice.
Duane Shank is senior policy advisor at Sojourners.