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Obama, Sarkozy and Taxing Wall Street

Thursday, 12 January 2012 08:02 By Jeff Cohen, Truthout | Op-Ed
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Obama Sarkozy and Taxing Wall Street

French President Nicolas Sarkozy speaks during a joint news conference with President Barack Obama at the White House in Washington, March 30, 2010. (Photo: Luke Sharrett / The New York Times)

With US media obsessing on the fight here at home among conservatives vying to become president, most of them missed some big news about France, which already has a conservative president. This week, French President Nicolas Sarkozy announced that he would take the lead - even go it alone within Europe, if need be - in introducing and pushing a financial transaction tax in his country.

That's right - the CONSERVATIVE president of France wants to tax the financial traders and speculators.

Referring to the tax as a "moral issue" and blaming deregulation and speculation for the global economic meltdown, Sarkozy has said that traders must "repay for the damage they have caused."

What does it tell us about US politics that the conservative president of France - on this issue and others - is way to the left of President Obama? The US president has not publicly promoted a Wall Street transaction tax (even though Wall Streeters, not the French, were largely responsible for the global financial crisis).

Sometimes called a "Robin Hood tax," a financial transaction tax is endorsed worldwide by everyone from conservative European leaders to the pope and the archbishop of Canterbury to Bill Gates and Ralph Nader. The tax is tiny per transaction and would barely be felt by middle-class investors or their pensions or 401(k)s, but it could raise big bucks from high-volume investors and impose a brake on the kind of speculation that tanked the world's economy.  

French President Sarkozy keeps explaining to the people of France and Europe that a small transaction tax raises billions for countries facing deficits.

Wouldn't it be something if President Obama went to the American people with such a deficit proposal, instead of putting Medicare on the chopping block?

President Sarkozy invokes the "moral issue" of financial institutions repairing the damage they caused. What a shock it would be to see President Obama aiming the "moral issue" at Wall Street profiteers and demanding repair of damage, instead of rewarding them with top White House jobs.

After failing to get resistant allies among European countries to join him, Sarkozy is going forward on his own, declaring yesterday, "If France waits for others to tax finance, then finance will never be taxed."

Can you imagine Obama standing up to a resistant Congress on a Wall Street transaction tax? He can't even stand up to his own advisers on the issue, according to Ron Suskind's insider book on the Obama White House, "Confidence Men." Suskind reports that Obama briefly embraced the tax and declared at one meeting: "We are going to do this!" But after Obama's top economic adviser (and Wall Streeter) Larry Summers criticized the tax, the idea was buried at the White House. 

That was back in 2009. But the idea is still alive on Capitol Hill. A couple months ago, Sen. Tom Harkin (D-Iowa) and Rep. Peter DeFazio (D-Oregon) introduced a financial transaction tax bill in Congress that would easily raise $350 billion over 10 years. Rep. John Conyers (D-Michigan) introduced a similar bill last year - it would tax Wall Street to fund federal jobs programs.

A Wall Street transaction tax is backed by National Nurses United and other unions. It's popular with the US public and would be even more popular if Obama were to campaign for it in 2012. RootsAction.org has gained 50,000 signatures  in support of the tax.

And don't get me wrong about Sarkozy. He's no great humanitarian. But he is facing an uphill re-election battle this year, and the conservative president understands how popular a financial tax is with the French public.

Facing re-election this year, maybe it's time President Obama came to that same understanding.

Jeff Cohen

Jeff Cohen is  founding director of the Park Center for Independent Media at Ithaca College and an associate professor of journalism there. His latest book is Cable News Confidential: My Misadventures in Corporate Media. He founded the media watch group FAIR in 1986. 


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