Registered: Nov 2009
11-25-09 12:47 AM
Matt Welch--Stock Transaction Tax: It's Like Slapping Yourself in the Face
Though it pains me to say something so obvious, it is clear there is still a faction on the Left that doesn't understand why we have capital markets: Yes, it helps lucky or shrewd investors earn money (while making many of their brokers rich), but that's only one side of the equation. The other side is, companies get to raise money to finance their operations for such useful endeavors as ... hiring people.
It always astonishes me how liberals can complain, again and again, about how such and such community, or company, or sector desperately lacks "capital" or "investment," and then turn around and characterize Wall Street as some kind of bogus scam to make the rich richer and throw people out of work. Whether it's through a day-traded purchase of a brand new dot-com stock, or a 10-year corporate bond in GE, the capital markets allow companies to raise money that would otherwise not be available. It is an inherently democratic phenomenon -- you no longer need to curry favor with the local bank president or government official just to open up a business.