How Will We Pay for Obama’s New Jobs Push? Answer: Tax Wall Street
The Nation, 8/31/11
By: John Nichols
August 31, 2011
President Obama is right: the United States needs a jobs program that spends federal tax dollars to retain jobs, to create jobs and to put tens of millions of Americans back to work.
Unfortunately, President Obama does not have a Congress that will work with him to implement a jobs agenda.
Rather, he has a Congress that says the United States is broke.
That’s a lie. The United States is a wealthy country with immense resources. It can fund wars of whim, back bailouts and tax breaks for billionaires.
So there is money. The problem is that the money is misallocated.
But that’s not the worst of it.
The most frustrating reality of the current moment is that the federal government places too much of the tax burden on working families, small farmers and small business owners—all of whom contribute mightily to society while struggling to make ends meet—and too little on the Wall Street speculators whose greed and irresponsibility has done so much to destabilize the economy.
Obama’s increased focus on jobs is important. But it is not enough at a moment when Republicans in Congress—and their echo chamber in the media—refuse to allocate the resources that are necessary to fund jobs initiatives.
The demand for a jobs programs must be coupled with demands for better budgeting priorities and for new sources of revenue. National Nurses United, the activist union that has been in the forefront of pushing for a genuinely progressive politics and economics in the United States, is addressing the revenue issue with a bold campaign for a tax on Wall Street financial speculation.
They’re taking the campaign to the offices of sixty members of the US House—Democrats and Republicans—with a September 1 “National Day of Action to Tax Wall Street.” At a number offices, such as that of House Budget Committee chair Paul Ryan, R-Wisconsin, they will set up 1930s-style soup kitchens to feed hungry families that have been left without work and in some cases without homes by plant closings and layoffs. (Ryan’s hometown of Janesville, a historic manufacturing center, has been devastated by the shuttering of major employers, such as a General Motors plant that once employed 7,100 area workers.)
NNU allies, such as Progressive Democrats of America and local unions and activist groups, will join the “Day of Action” drive to get members of Congress to sign a pledge to “support a Wall Street transaction tax that will raise sufficient revenue to make Wall Street pay for the devastation it has caused on Main Street.”
“It’s time for Wall Street financiers, who created this crisis and continue to hold so much of the nation’s wealth, to start contributing to rebuild this country, and for the American people to reclaim our future,” says NNU executive director Rose Ann DeMoro.
NNU co-president Deborah Burger, RN, says a tax on Wall Street trading of stocks, bonds, derivatives, currencies, credit default swaps and futures—the very financial speculative activity linked to the 2008 financial meltdown and resultant recession—could raise hundreds of billions of dollars to pay for the programs that “are desperately needed to reduce the pain and suffering felt by so many families who feel abandoned in communities across this nation.”
That’s not just idealism talking. It’s practical economics, as accepted by a growing array of world leaders—including many conservatives—as well as top economists.
University of Massachusetts Amherst economics professor Nancy Folbre, a MacArthur Fellowship recipient who has consulted with the World Bank and the United Nations Development Office professor of economics at the University of Massachusetts Amherst, praised the NNU’s “Tax Wall Street” campaign in a recent New York Times piece that explained the push in an international context.
“Purchases of stocks, bonds and other financial instruments in the United States go untaxed but for a tiny fee on stock trades that helps finance the Securities and Exchange Commission. In Britain, by contrast, a 0.5 percent tax on stock transactions raises about $40 billion a year. President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany recently announced plans to introduce a similar tax in the 27 nations of the European Community,” wrote Folbre. “Our current tax policies favor speculative investment in financial instruments over productive investments in human capabilities. This imbalance helps explain why nurses’ unions in the United States (NNU) have been particularly outspoken advocates of a financial transactions tax. As they put it: ‘Heal America. Tax Wall Street.’ ”
The fiscal arguments for taxing Wall Street are sound.
So, too, are the political arguments.
At a point when so many politicians and pundits claim that America is “broke”—too “broke” even to pay for essential jobs programs in a time of high unemployment—the “Tax Wall Street” proposal provides a proper response. America is not broke. It just needs to follow the example of the rest of the world and demand that the speculators pay their fair share to heal the real economy.
Of course Eric Cantor and Paul Ryan will scream. But it will sound mighty shrill if they are claiming America can’t help the jobless because we’re “broke”—and that America can’t tax speculators and raise the money that would make us not “broke.”