Despite some similarities, there are differences between my approach to the Tobin transaction tax and Mark Cuban’s. He calls for a levy of 25 cents per share traded. Ouch. Not gonna happen; won’t pass. Simpler, and a way to ease it in, would be to levy one hundredth of a percent of the VALUE of each trade. Or else… more directly justifiable… don’t charge all of the costs of SEC etc to the federal budget. Instead the new transaction fee (not a “tax”) rises or falls based on the current cost of enforcement, regulation and reserves. Either way, what Cuban strangely never mentions is my chief motive for doing this… a general Tobin Trading Levy would be death to a recent-modern villainy — coded-reflex cheat-trading by big brokers who gamble and nibble at the margins through billions of tiny, computer-spun micro-trades, taking unfair advantage of both their privileged stock market memberships (no commission) and their quicker access to inside information to detect clients’’ buy orders — thus gaming the system while those buy order are in play! This reform is obvious… and won’t happen. The Chicago School neo-classicists who caused the collapse still see a trillion efficiency angels dancing on the head of a pin. The pin that popped our economy. David Brin ☀
Wednesday 12 May 2010
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