Tobin tax

I'm confident that the trend of history is toward the disaggregation of sovereignty, and I'm happy that Ireland's recent rejection of the latest round of Euro-treaty making looks like an example of that.

That said, there are still efforts underway in the other direction, toward some sort of global political federation. This would require a world tax, and the latest plausible candidate for such a thing is the "Tobin tax."

The original idea, posed by American economist James Tobin in the 1970s as the Bretton Woods structure was unravelling, was that if an international authority imposed a tax upon currency speculators, they'd dampen down the volatility of that market, preventing wild swings in say pound-versus-yen rates that might otherwise generate crises.

Tobin, a Nobel Prize winner, didn't pay much attention to the issue of what would be done with the money once it was collected. The point for him was chiefly to discourage the sort of thing that later made Soros so wealthy.

At any rate, the "Tobin tax" is almost always cited nowadays as a neat idea for collecting money for a lot of idealistic causes as here.

My usual mellow response to Tobin tax supporters, though, is: in your dreams.

Why do I bring it up? Well, I find the original idea behind the proposal intellectually interesting. I wrote about it a few times while at HW, and I'm happy to say that advocates of the tax thought I was being fair to them.

And besides, what else would you have me write about? the news from Denver? Boooooring.