![]() The cumulative effect of these changes could create a “significant recession” and the loss of close to two million jobs, according to the Congressional Budget Office. faces a “fiscal cliff” when a number of taxes are set to automatically increase and severe cuts in public spending are scheduled to begin. FTT would have brought in between $750 billion and $1.2 trillion each year from 2005 to 2009, while the Center for Economic Policy Research (CEPR) has a proposal with a (conservative) estimate of $177 billion being raised.Īre we serious about tackling the deficit?Īt the end of 2012, the U.S. A study by the Chicago Political Economy Group showed that a U.S. Around the world, FTTs brought in a total of $38 billion in 2011. Which transactions are taxed and at what level affects the amount of money raised. A number of European countries will likely implement new FTTs later this year. In 2011 a total of 40 countries had an FTT in operation. currently has an FTT of 0.0034 percent on stock transactions that pays for the Security Exchange Commission’s budget. ![]() Numerous times in the past few years, markets have had to shut down temporarily because of out of control high frequency computer programs. While some have argued that these traders help to lower the cost of trading, there is growing evidence that they have a negative effect on markets. They use complex computer programs to buy and sell thousands or even millions of times every second. Those who would be affected are a new type of investor called high frequency traders. Compare that to the fact that many states currently charge a full nine percent tax on the sale of most consumer goods.īecause the tax is so small, the vast majority of investors would feel practically no impact. Normally the tax is placed on the buying and selling of stocks, bonds, derivatives, futures, options and/or currencies. A financial transaction tax (FTT) would help decrease economic instability and shift money out of the bloated financial sector and into the real economy where it can create jobs and progress.Īn FTT would place a very small tax (usually between 0.0001 and 0.5 percent) on different financial transactions. gross domestic product – up from 18 percent in 1995.The resulting “casino” economy has created chaos, throwing people out of work and families out of their homes unnecessarily and costing governments trillions of dollars in bailouts. In 2010, the assets of the six largest U.S. Over the past few decades, the financial sector has grown to historic proportions. It was published in the September-October 2012 NewsNotes. The following article was written by Dave Kane, who worked with the Maryknoll Office for Global Concerns for six years he recently relocated to Brazil with his family. There is a simple and relatively painless way to confront two central economic problems facing the world today: the lack of money available for public investments necessary to create the conditions for human dignity and increasing economic insecurity due to the growing size and influence of financial institutions.
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