Super-rich guys stole your money; make ’em pay

Bill Knight column for Mon., Tues., or Wed., June 25, 26 or 27


In Chicago and Washington, D.C., Dayton, Ohio, and El Paso, Texas, New York City and Los Angeles and nine other U.S. cities last Tuesday, regular Americans demonstrated outside JPMorgan Chase and other such sites to launch a campaign for a “Robin Hood Tax” on $peculator$.

It may seem like an issue about Wall Street or New York, but the consequences of the financial sector’s reckless casino shenanigans have been felt on Main Streets throughout Illinois – where people could use some help from the $350 billion that could be generated.

A Robin Hood Tax is a sales tax, but one not paid by consumers but by speculative Wall Street trading. The small tax – 50 cents per $100 – would be levied on stock-trading; even smaller assessments would be on bonds, derivatives and currencies. The tax is aimed at high-volume trading, which means most trades these days.

The tiny tax can generate enough money to make a difference for people, points out “Axis of Justice,” a non-profit organization formed by Tom Morello (Rage Against the Machine) and Serj Tankian (System of a Down) to bring together musicians, fans and grassroots groups to advocate for social justice: The resulting billions are…

“Enough to protect American schools, housing, local governments and hospitals,” AoJ says. “Enough to pay for lifesaving AIDS medicines. Enough to support people and communities around the world – and deal with the climate challenges we’re facing.

“It won’t affect ordinary Americans, their personal savings, or everyday consumer activity, such as ATMs or debit cards,” Morello’s outfit continues. “It’s easy to enforce and tough to evade. This is a tax on Wall Street, which created the greatest economic crisis in our nation since the Great Depression – the same people who have returned to record profits and bonuses while ordinary Americans, the 99%, continue to pay the price of their crisis.”

Dozens of national groups including National Nurses United (NNU) and the AFL-CIO, celebrities such as Morello, actor Mark Ruffalo (“The Avengers”) and Chris Martin (Coldplay), President Reagan's Budget Director David Stockman and U.N. Secretary-General Ban Ki-moon, Bishop Desmond Tutu and Microsoft founder Bill Gates, multimillionaires Mark Cuban and Warren Buffet all have come together to form an extraordinary coalition supporting a Robin Hood Tax. More than 1,000 economists have endorsed the idea, including Nobel Prize winners Joseph Stiglitz and Paul Krugman, Jeffrey Sachs of Columbia, Dani Rodrik from Harvard, Ha-Joon Chang from Cambridge, and Lawrence Mishel of the Economic Policy Institute.

Last week, demonstrators – Jobs with Justice, Health GAP, Occupy our Homes, AIDS activists, and NNU members – lined the hallways outside the House Committee on Financial Services hearing room. Inside, JPMorgan Chase CEO Jamie Dimon tried to explain its $2 billion-plus loss, the result of the same risky derivative speculation that helped fuel the 2008 crash and the Great Recession.

(It wasn’t all somber protesting. Some obviously merry men and women before dawn masked some of the 15 cities’ best-known statues. By sunrise, everyone from Gandhi and Goethe to Andy Warhol and Benito Juarez wore Robin Hood’s familiar green mask and hat.)

It’s fair that financial transactions incur a sales tax – just as 99% of us pay on everything from Coke to cars – and put some Wall Street resources back into Main Street. It could be considered a mild punishment, signaling that it's time for Wall Street to help pay for the damage it did to the country. Or it could be considered as just a “cost of doing business.”

The money could provide funding for jobs to jump-start the economy. It could help save the social safety net. And it’s sensible.

“Today, 23 percent of our nation's Gross Domestic Product, or $3.6 trillion, is sitting in banks' and non-financial corporate accounts – an unprecedented cash reserve in the face of overwhelming national need,” said Rose Ann DeMoro, executive director of NNU, which represents 156,000 registered nurses.

Supporters noted that a Robin Hood Tax not only would produce badly-needed revenue from a source that can afford it and in meaningful amounts, it would help limit careless, short-term speculation that threatens financial stability – such as JP Morgan Chase's scheme.

At last week’s G-20 summit in Los Cabos, Mexico, AFL-CIO President Richard Trumka introduced International Monetary Fund (IMF) Managing Director Christine Lagarde, and urged her to back the financial speculation tax. (Some type of Robin Hood Tax already exists in more than 40 countries.)

"Now is the time for Wall Street to pay its fair share with a financial transaction tax that would create jobs, rein in speculation, raise hundreds of billions in new revenues and lay the groundwork for long-term economic prosperity," Trumka said.
That 50 cents on $100 is small change for big banks, but it could mean big change for the rest of us.

Learn more about the Robin Hood Tax coalition online at robinhoodtax.org