What happens when you tax something that formerly was untaxed? You get less of it. I’m seeing this play out in my own little town here near Boston. it used to be that for some modest fee, $20 a year or so, you could use the town dump as much as you liked. After they filled the dump and had to open a transfer station they raised the fee for the permit and charged users a fee for each bag of trash they dumped, so called “pay as you throw.”
The place has run a deficit since the day it opened. What does the town do? They raises fees to cover the shortfall. What happens then? They get less revenue. People end up using private carters and avoid all the hassle. Where am I going with this, you ask?
Rep Peter Defazio is proposing Congress tax securities transactions 0.25%. He says they would raise $125 bln a year, soaking Wall Street in the process. Guess what? It would work just like the dump, driving business out of the US. These guys are just dumber than a bag of hammers.
Rep. Peter DeFazio, an Oregon Democrat, has been circulating a letter to other lawmakers calling for a 0.25 percent transaction fee on the sale and purchase of stock and more exotic transactions such as those involving credit default swaps, options and futures….
DeFazio said in his letter that “the easiest method to raise the $700 billion from Wall Street is a securities transfer tax, a tax that has a negligible impact on the average investor and provides a disincentive to short-term traders.”
Emerging from a meeting with fellow House Democrats on Thursday, DeFazio said, “Everybody’s angry. This is like a giant screw job by Wall Street. They’re holding a gun to their head and saying, ‘If you guys don’t help us, we’re going to blow our brains out and take you with us.'”
