The Tobin Tax Lives Again

In late August, Adair Turner, the head of the UK’s Financial Services Authority, shocked the Anglo-American empire of finance by coming out in support of a Tobin tax – a global tax on financial transactions. Predictably, Adair's proposal was met with a storm of criticism by bankers, which suggests why implementing such a tax would be a very good idea.

CAMBRIDGE – Something happened in late August that I never thought I would see in my lifetime. A leading policymaker in the Anglo-American empire of finance actually came out in support of a Tobin tax – a global tax on financial transactions.

The official in question was Adair Turner, the head of the United Kingdom Financial Services Authority, the country’s chief financial regulator. Turner, voicing his concerns about the size of the financial sector and its frequently obscene levels of compensation, said he thought a global tax on financial transactions might help curb both.

Such a statement would have been unthinkable in the years before the sub-prime mortgage meltdown. Now, however, it is an indication of how much things have changed.

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