Quote:Though there are many ways it could be done, what he proposes is to tax stock, bond, and derivatives trading on wall street. Presumably this would be a very tiny tax with the massive amount of trading resulting in a large enough fund to pay for the public universities. 

 

My first question about paying for everyone's college education wouldn't be "How do we pay for it?"   My first question would be "How much does it cost?"  

 

Then, if you put a tiny tax on high speed trading, it would have to be a sub-microscopic level of tax, because the profits made on each of those transactions by high-volume traders is miniscule.   I mean, it sounds great, there were so many billion shares traded today, a penny on each trade would raise tons of money, but a penny on each trade might just wipe out high speed trading by wiping out all the profits.   And then you don't raise any tax revenue at all. 

 

Taxing something can have two effects: yes, you can raise money theoretically, but you also might kill your tax revenues by wiping out your source of taxes.  

 

So, if you're trying to wipe out high speed trading, which may be a good idea, go ahead and tax it.   Just realize, you won't raise as much in taxes as you think, because taxing it will reduce it. 

 

So, to summarize, Bernie Sanders needs to specify how much this will cost, and he will have to specify how much the tax is, and how the tax will affect the activity that provides the tax revenues.   I think they call it "dynamic scoring" or something.   It's not simple math.  

 

So many of these politicians are blind to the actual effects  of their policies.   I remember, I think it was back in the 70s, they put a tax on yachts, and all they succeeded  in doing was to throw a bunch of people out of work. 

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