I thought the expression "sin tax" applied to vices like smoking, drinking, and gambling. If someone wants to buy that pack of cigarettes, by making it more expensive for him to do so, he'll be less likely to make the purchase. So either the government will have more money to spend inappropriately or the smoker's lungs will get a breather from all the tar and nicotine that is being pumped into them. A win-win situation, or so the thinking goes.
The philosophy behind the sin tax has been expanded to include financial activity on Wall Street. Miranda Leitsinger's article on the U.S. News on msnbc.com website from three days ago, entitled "Nurses (yes, nurses) lead charge for Wall Street 'sin' tax," explains this point of view:
A coalition of nurses’ unions is calling for a “Robin Hood” tax on Wall Street, which they say could generate up to $350 billion a year, in the first major protest ahead of this weekend’s NATO summit in Chicago.Their pitch: impose a tax of 50 cents on every $100 of trades of stocks, bonds, dividends and other financial transactions, which are not currently taxed. The U.S. would join more than a dozen other nations that already have a financial transaction tax, according to National Nurses United (NNU).
So the premise is as follows: We are not being taxed enough. We need more money for social programs. Investing is a sin, so by implementing a small tax, we can raise the money that is needed.
Karen Higgins, a registered nurse and co president of NNU, is quoted as saying the following:
"We're watching this every day. We're watching patients suffer," she said, noting that nurses were seeing people without insurance or others who can't afford their co-pays, as well as a spike in the number of children with adult diseases due to eating poorly because their parents can't afford healthy food. "This is serious and in some cases it is actually deadly."
As the article explains, a financial transaction tax is not new. We had one in this country from 1914-1966. The lingering question that the article does not address is why the tax was discontinued.
A comment in a Minnesota blog, Growth and Justice, from 1/13/09 provides a possible explanation:
Do people realize what they are doing to themselves? To put it simply, the people are going to hurt themselves and only themselves by thinking they will punish Wall Street with the trans tax. A 1/4 percent tax on both a buy and sell will cost the average person several percentage points from total gains over a lifetime. With only a quarter percent tax, tens of thousands, even hundreds of thousands of dollars of the average person's retirement will not be realized over a working lifetime. And the lack of liquidity by killing all that "evil" trading that makes stock and fund purchases so cheap, will easily more than double those losses. The US had a transaction tax starting in 1914. In 1966 the US stock trans tax was eliminated to help level the playing field for the average person. If the trans tax comes back, the big insiders will profit immensely from us trying to enter the market, just like the old days.
We want our markets to be liquid. More taxes will lead to less activity on Wall Street. And less money in our pockets. How can this be good?
The nurses can get off their high horses and shut up. They want to tax us to spend more on them? Why don't they go protest something they understand and that will change something: go harass Phillip Morris.
double post
I think we need to tax certain industries more heavily.
If your primary job is to meet with Washington politicians, regulators, and officials, you should pay a 70% tax on all earnings attributable to those activities beyond $1 Million.
People can also make similar arguments about folks working at FDIC insured banks and on personal injury litigators.
Libertarians are right. If you impose high taxes, you slow growth. But maybe we shouldn't be encouraging folks to be driven to make government bigger. Maybe we shouldn't be encouraging folks to be driven to sue people. Maybe we shouldn't be encouraging folks to be driven to take huge risks with what's effectively the government's money. High taxes, at least on lobbying, will help slow the growth of government.
Sidenote: I can't even tell you how many nurses i see in those pajama looking uniforms smoking cigerettes...
Those pajama looking uniforms (scrubs) can also carry MRSA. I always give them dirty looks when I see folks wearing them on the subway or in public.
Maybe their patients should become investment bankers...
That was a joke.
Nurses are making $100K a year with a 2 year associates degree. Maybe they should be quiet and keep milking that gravy train.
I will never understand people crying for more taxes on other people. I just read an article about how the states are taking all the Federal money meant for mortgage relief and dumping it into the general fund. More taxes will just do that.
Just like in NYS, how they sold the lottery as a panacea for school budgets. Now all that money goes into the general fund.
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