Rep. Ellison Reintroduces Wall Street Speculation Bill HR 1464

Date of press release: 

3/19/2015

Robin Hood Tax Would Expand Opportunity Curb Market Volatility

 

Washington, D.C. – HR 1464, a bill to establish a small tax on certain Wall Street transactions to raise hundreds of billions of dollars every year to reinvest in American families and communities, and curb casino-style high frequency trading, was reintroduced today by Rep. Keith Ellison (D-MN).

The Inclusive Prosperity Act represents the principles and goals of the U.S. Robin Hood Tax Campaign, with the backing of 172 national organizations representing millions of members in labor unions, religious groups, health advocates, consumers, housing activists, environmentalists, small businesses and others urging passage of a Wall Street sales tax. 

Passage of the Act would also allow the U.S.to join the rest of the world – including every other major global financial market – in a growing system of financial transaction taxes.  

In the U.S. a nominal tax on the sales of stocks, bonds and derivatives could raise the critical funds to expand opportunity and financial security for low-and moderate-income families, rebuild our crumbling physical infrastructure and create good paying jobs. 

“America’s working families need their country to invest in them again,” Rep. Ellison said. “The money raised from a wafer-thin tax on Wall Street’s high frequency trades could raise hundreds of billions of dollars to invest in our families, protect our environment and increase opportunity for all Americans. If the United States joins the dozens of other nations already benefitting from a financial transaction tax, we can create millions of jobs, while also reducing dangerous market volatility.”

This bill sets a small sales tax of 0.5 percent – just 50 cents on every $100 of stock trades – and even smaller amounts on transactions of bonds, derivatives or other financial speculation.  Brokers carrying out the trades would be charged the tax, unless carried out directly by investors.  Households with adjusted gross incomes under $75,000 would be exempted. The fee would not apply to ordinary consumer activity, such as credit card or ATM transactions, checking accounts, personal loans or tax free municipal bonds.

 

‘Those who benefit the most should pay to make our society work’

“For years our organization, has advocated that all in the United States should pay their fair share in taxes,” says Sister Simone Campbell of NETWORK, a National Catholic Justice organization and a member of its well-known Nuns on the Bus. “The Inclusive Prosperity Act gets us closer to that goal. It is just that those who benefit most from our society should pay into the cost of making our society work. Right now, financial sector traders are not paying their fair share. Our economic future requires these traders to pay their fair share to fund the common good. It is the faithful way forward and what is required to form a more perfect union.”

“The idea of the Robin Hood Tax is an idea whose time has come,” says Rev. Rodney Sadler, professor at the Union Presbyterian Seminary in Charlotte, NC and a leader of the Moral Mondays civil rights movement in North Carolina. “For far too long the wealthiest among us have been enjoying the fruits of the labor of the poorest among us without reaching back to offer them a hand up.  The Robin Hood Tax is a simple idea that would provide considerable resources that will allow us as a nation to offset human suffering and provide a modicum of relief for the least, the lost, and the otherwise left-out.”

 “Inequality in health, still rampant hunger, homelessness and poverty continue to devastate far too many families. The climate crisis puts our planet at risk and is rapidly accelerating extreme weather events, droughts, and epidemics that threaten public health. We need the Robin Hood Tax, best embodied in Rep. Ellison’s bill, to raise the revenues we desperately need to protect our health, our families, our communities, and our nation,” said Deborah Burger, RN, co-president of National Nurses United, the largest U.S. organization of nurses.

"Income inequality is now at the center of our national political discourse, with politicians of every stripe recognizing it as a major problem of our time. What too few are willing to say is that we must demand more revenue from corporations and the 1 percent to level the playing field,” said George Goehl, executive director, National People’s Action. “If our elected officials are serious about tackling inequality, then they should support this bill."

“Experts are saying that we have the science we need to end the global AIDS crisis, yet everyone agrees that this will not be possible without a considerable increase in resources.  In his 2016 fiscal year budget, the President proposed over $400 million in cuts to spending on the global AIDS response. To put this into perspective, this is less than 0.15 percent of the total estimated revenue that Congressman Ellison’s financial transaction tax will generate,” said Jamila Headley, managing director of Health GAP (Global Action Project).

Rep. Ellison’s bill would also slow the growth of automated high frequency trading, which makes the stock market more dangerous. High frequency trading has been at the heart of unprecedented market volatility over the last half-decade. Using sophisticated algorithms and computers, high-frequency traders execute trades in seconds. A small tax would make risky HFT unprofitable, and help reduce the excess speculation on commodities like food and gas that drives up prices, which will protect the market and economy from computer-generated collapses and market manipulation.

Because of the computerized nature of the market, the tax would be easy to track and enforce and tough to evade. The proposed Wall Street speculation tax is already popular worldwide. Forty nations from the United Kingdom to South Korea administer or have administered a financial transaction tax. The introduction of the Inclusive Prosperity Act comes as 11 nations in the European Union are finalizing details of their own financial transaction tax to be implemented on January 1, 2016. The U.S. had a similar tax from 1914 until 1966, and there have been bi-partisan calls to reinstate it over the past two decades, including from financial advisors to President George H.W. Bush. Many world leaders support a FTT.