Op-Ed: Taxing Wall Street Traders

High-frequency traders have turned Wall Street into a casino. They spend millions of dollars on super high-speed internet and develop complex computer algorithms so they can quickly find out what you are willing to pay for a stock, buy it for slightly less, and then sell it back to you at a profit, taking money right out of your pocket. What’s worse, this type of speculation is exactly the type of irresponsible behavior that led us to the Wall Street crash of 2007. Once again, the rich are making risky bets and we might all be left holding the bag. But we can fix this.

Senator Brian Schatz from Hawaii has proposed a bill which would add a .01% tax on all purchases of stocks and bonds. This is an excellent idea because it would raise billions of dollars for the government to invest in healthcare, education, and infrastructure. It would also deter these high-frequency traders from investing in ways that provide no social benefit to companies while increasing instability in the market. The brunt of the tax burden would fall on the richest 10% of American’s while barely affecting your average household investor or pension fund. And it would lessen Wall Street’s influence in Washington DC.

Almost everything that you and I buy every day is subject to a sales tax. I spend most of my income at Safeway, Target, the gas station, and restaurants. I pay taxes on everything I buy at these places and I’m sure my landlord factors her property taxes into the rent she charges me. Wealthy people spend most of their money at the stock market and don’t pay any tax on what they buy there. This seems unfair. If we can raise $75 billion a year while still letting rich people profit from a market that we all support, shouldn’t we?

Bill Gates, George Soros, and the Pope all support this tax, and the UK, South Korea, France, China, and many other countries all have their own. It is time we do the same.