This copy is for your personal, non-commercial use only. In the
debate over the “fiscal cliff,” President Obama and
congressional Republicans have returned to the proposals that
they were sparring over before the election. They remain at odds
over key elements of revenue and spending. Yet both sides are
unwilling to consider a minuscule tax on financial transactions
that could be a major source of income. A financial transaction
tax would apply to purchases and sales of derivatives, options
and stocks. The tax would be small, half a penny or less on each
dollar of the transaction value, depending on the product. This
idea is often called a “speculation tax,” because it would hit
hardest at frothy high-volume trading as opposed to sober long-
term investment. Wall Street might object, but taxing its sales
is hardly a radical idea. Americans in all but five states pay
state sales taxes, ranging as high as 7 percent, every time they
buy a car, an appliance, a pair of pants or piece of furniture,
but a trader on W