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Chicago Political Economy Group's Bill Barclay argues imposing a tax on speculation trades at the exchanges would create jobs.
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Could attacks on trades actually end up creating jobs there's a -- out of Chicago that introduced a proposal.
Would put a quarter tax at 45 cent tax on each speculation traded the city and they believe that Chicago could raise about.
One point four billion dollars from that use that to create about 40000 new jobs bill Barkley.
Contributed to that proposal with the Chicago political economy group joins us now from Chicago.
With more on that -- it's good to have you on the show the occupy Wall Street protesters get criticized for not having specific proposals so He are out in Chicago specific proposal.
We give you that but talking about the substance of it a lot of business people would say boy taxes usually destroy jobs not create them but what's your argument.
-- -- thanks pat me on the show let me give you the argument -- with a little bit of background.
I just that I'm with a group called the Chicago political economy group -- -- for short and working with stand -- Chicago which is a coalition of community labor coalition.
We they and we together created this jobs plan they they conducted about 141000 interviews throughout communities in Chicago.
We did an analysis argue she was an inventory who of the unemployed Chicago and what are the work that needs to be done okay put it together.
We can we create a plan that would generate 40000 jobs for the city Chicago about the number one quarter the number of people unemployed.
Now the jobs to be in things like health care education refurbishing neighborhoods community care and we were created jobs fund.
So you just started by tell -- where the jobs -- come from in an elaborate on that the jobs fund would come from a very small fee on every contract is traded on the Chicago really markets.
-- stopped at every -- sorry but receptive prolific.
So the very small feast when He for its 25 cents per trade right is that and I have that right about -- -- -- -- five cents per contract okay.
So we asked the CME to comment on -- for whatever reason they didn't want to have a comment but Phil Flynn is Orkut one of our contributors is traded there for years.
We talked to him and He -- say boy they only make the CME makes about a dollar thirteen -- trade.
So when you put it your proposal be able -- yeah that's sounds like nothing to 25 cents but Tony five cents as a percentage or dollar thirteen.
That's a pretty big tax on these guys and what -- and what they're making up there.
-- I'm glad you asked that question was attacks that the fee is not on the exchanges the fee is on people who trade if He works for example exactly like what happens the United Kingdom where you've had a a field could still -- higher than -- one quarter of 1%.
All trade stock trades have been in a place for over a century -- -- -- on trades is not a field exchanges if you trade to pay the fee if you don't -- -- don't pay defeat.
To put the funny five cents in perspective.
If you look at the underlying value the average underlying value of futures and options contract traded in Chicago.
You -- the average underlying values about 233000.
Dollars this fee is 1101000 of 1%.
Of that underlined the arguments is they pay -- is that the traders make is this it all right.
But if you're gonna do that we're gonna go trade somewhere -- -- trade Chicago -- trade overseas -- You know off exchange somewhere because and they cheaper forced to do that and that.
You know -- -- -- proposal like this might be defeatist and added you have wall wallet creates jobs on the one side but it takes them away on the other.
Well again you have to go look at experience around the world let's go back to the UK they have the sixth largest economy in the world -- the second largest stock market in the world they're fee is.
More -- a multiple hours by at least a hundred and -- moves it has moved trading abroad.
It's very hard to move liquidity in some of the product to which this fee would be levied our proprietary products in the sense that they are licensed in exchange in which they trade occurs.
So I think that's it it's unlikely that people would move for 25 cent fee and a very hard to move because where you gonna go trade some of the stuff you can't transfer liquidity usually from one exchange to -- -- enough -- we have to run now but there's a proposal.
25 cent -- has little -- 40000 jobs bill Barkley from Chicago thanks for coming on.
