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Why a 'Robin Hood' tax is a good idea

Ros Atkins Ros Atkins | 15:12 UK time, Thursday, 15 April 2010

A few days ago I mentioned that Tom has asked if we'd take posts from him and others who post on the blog. Of course, we our answer and here's Tom's post:

;Thanks to Ros and the WHYS team for letting me post. Lots of topics are happening
right now. But for many of us, let's look at something closer to home. A "Robin Hood" tax.

What's that? It's a proposed tax on banks, hedge funds and other financial firms (roughly
0.05%). In fact all financial transactions would be taxed. Who likes this idea?:

Gordon Brown
Angela Merkel
Nicolas Sarkozy
Lord Turner (from the U.K. Financial Services Authority)
George Soros
Warren Buffet

The revenue could be used for everything from fixing infrastructure to better health care. Sounds good so far.

But many financial firms hate it. You can't do this. It's "socialism". If you do this, all the banks will leave and move to Switzerland. What then?

Actually you're wrong. It's not socialism. It's being socially responsible. Right now you're enjoying making billions in unregulated profit thru derivative speculation.

(NOTE: A derivative is essentially a tool that allows you to bet on the potential outcome of practically anything. Example: The Ros Derivative. What will Ros eat for lunch two weeks from today?).

So in exchange for this, it's just good business for you to give back a tiny part of that to society.

Many reliable sources say the global derivative market is at least $100 trillion. 0.05% of $100 trillion is $50 billion.

Another benefit. The media loves a "hot, sexy" story. And frankly, the "greedy banker" angle has been done to death. Why not go in the opposite direction? Socially responsible is in. And by paying this tax you're tapping into lots of free publicity that will only benefit your firm long-term.

What's your view on this? Do these firms have a responsibility to society? Would this work in your part of the world? What would you spend this money on?

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