In vain it tugs at the knob
of the invisible door.
As far as you've come
can't be undone.
from "On Death, Without Exaggeration" (1986)
It's weird to be joyous over someone's death. A bit unsettling.... but
that's how it is... how i felt..."
There is no more reason for people in the United States to be concerned about buying derivatives abroad than we are about buying shoes and clothes from abroad. If other countries choose to attract trade in derivatives with a more poorly regulated financial system -- implicitly having their taxpayers assume the risk of a meltdown (e.g. Iceland) -- then there is no reason that we should not simply buy our derivatives from these countries and concentrate our production on areas in which we enjoy a comparative advantage. NPR should have included the economist's position in this segment.This insight struck me, partly because the general issue (the value of having a particular financial product brokered or sold domestically) seems to be present in some of NKW's reflections regarding the frequently proposed financial transaction tax (FTT or a 'Robin Hood Tax') and, indeed, in a lot of discussion regarding the impact of financial regulation in a globalized market. This is different than the, question of how much revenue a unilaterally imposed FTT could raise given the likely diversion of that business abroad. This capital flight factor strikes me as more important in setting the level of a FTT than whether or not to impose it; clearly there are reasons why many consumers of financial goods prefer to buy in hubs like London and NYC and there must be some appropriate level of taxation before deadweight losses and lost revenue eliminate those advantages and start to be counterproductive for society. I do not disagree with NKW that global implementation is preferable or that the taxation of financial goods is a complicated and delicate balancing act.
The Robin Hood Tax is a tiny tax on bankers that would raise billions to tackle poverty and climate change, at home and abroad.By taking an average of 0.05% from speculative banking transactions, hundreds of billions of pounds would be raised every year.That’s easily enough to stop cuts in crucial public services in the UK, and to help fight global poverty and climate change.