Dear Colleague, I'm writing to ask for your help in building support for an important step to get the U.S. economy moving again and cut the risk of future financial catastrophes. Will you join an open letter from economists and financial analysts to President Obama, Treasury Secretary Lew, and Members of Congress proposing a financial transaction tax?
An FTT will encourage stability by discouraging the short-term trading that contributed to the financial collapse. Such a tax can also raise significant revenue to help restart the nation's economy and address critical needs. I am attaching and appending (see below) the letter. If you wish to sign-on or if you have questions, please email me: [email protected]<mailto:[email protected]>. I hope you can join us in supporting this common sense approach that offers a real opportunity to help restore the financial sector to its proper role, while raising massive revenues to create jobs and pay for key programs our nation sorely needs. This is an opportunity that should not be missed. Sincerely, Laura MacCleery, Legislative Director National Nurses United 240-235-2000 [cid:[email protected]]<http://www.nationalnursesunited.org/> www.NationalNursesUnited.org @NationalNurses<http://twitter.com/NationalNurses> ECONOMISTS AND FINANCIAL ANALYSTS FOR A U.S. FINANCIAL TRANSACTION TAX [DATE] Dear President Obama, Secretary of the Treasury Lew, and Members of Congress, We write as economists and investment and financial experts because we believe the time has come to establish a financial transaction tax in the United States. The recent agreement by 11 countries in the European Union to move forward toward adoption of such a tax shows that the idea is rapidly gaining major support throughout the world. It deserves its place in a global arsenal of tools for addressing both the need for revenues and the destabilizing influence of short-termism in the financial markets. Indeed, operating financial markets with a financial transaction tax is now the norm across most of the world's major financial centers, including, London, Hong Kong, South Africa, India, Taiwan and Switzerland. The fundamental purpose of financial market is to provide funds for productive enterprises and address risk. Yet 60 percent of trades are automated<http://www.bryanturstadt.com/uploads/Jan10_Feature_Trading.pdf>, using algorithms that can cause flash-crashes and liquidity crunches. A financial transaction tax is an important regulatory tool that should and would have the greatest impact upon the most frequently traded assets. The financial transaction tax will raise the costs of relentless short-term churning that distracts the markets from focusing on promoting long-term productive investments. Studies and historical experience demonstrate that a financial transaction tax set at reasonable tax rates will not discourage productive investments and economic growth even while it will promote a more stable system of financial market trading. Nor would the tax be too costly for traders, as trading volumes will adjust to account for the modest increase in transaction costs. In particular, ordinary investors will be least affected by the tax. Its greatest impact will rather be on high-frequency traders. With debates in Washington continuing over how to pay for our most important commitments to our citizens, it is clear that we need new taxes that are both fair and that encourage productive investments in our economy. A sales tax for Wall Street trades is, in fact, a common-sense idea whose time has come, and should be included in the mix of proposals to fund the government's current and future priorities, supplying funds for programs that meet human needs. The "Inclusive Prosperity Act," introduced by Rep. Keith Ellison (D-MN) would raise substantial revenues while taxing transactions at a level designed to reduce speculative activity that threatens to destabilize the markets. In fact, Rep. Ellison's version of the financial transaction tax could raise hundreds of billions of dollars annually without imposing hardship on the overall economy. Rather, it will enhance the operations of financial markets by discouraging the type of destabilizing speculation that produced the disastrous Wall Street crash of 2008-09. The financial speculation tax is a rare political and economic win-win, and we urge you to support efforts towards its enactment. [The undersigned]
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Economists' Petition on Financial Transaction Tax final.docx
Description: Economists' Petition on Financial Transaction Tax final.docx
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