Tax Derivatives to Reduce the Debt & Improve the Economy

The gross domestic product (GDP), the sum of all economic transactions in the US, is roughly $15T, which is roughly comparable the national debt. Sounds big and bad (respectively) but they pale in comparison to the derivatives market, which is over 20-times larger!

Derivatives can be used to reduce risk by betting on a future price. This is valuable in particular situations, such as farmers planting crops, but the total market has grown to a size that causes dramatic volatility in currency and energy (oil) markets, increasing the risk to economic stability. These trades are largely unregulated and entirely untaxed. I propose we tax derivative trading at the trivial rate of 1%. I don't predict that we would raise all $6T annually, because some trades would not be done, some might go further undercover, and some will go 'offshore'. But NY State Pensions won't deal with entities in the Caymen Islands or Geneva as freely as they would Long Term Capital, or Lehman, or Solomon. We will raise significant amounts of 'revenue' (money) and reduce to some degree the silliness and scariness of the market.

Voting Guide

There seems to be some confusion 'out there' about the reason and rational for (a) voting and (b) voting for somebody in particular. This handy pocket guide is intended to help dispel confusion and is suitable for writing on your hand for cribbing inside the sanctity of the voting booth.

1. Vote.

If you don't vote, don't complain. The saying “I don't vote; it only encourages them” is funny but stupid, because it leaves the choice in the hands of the zealots. Don't think you have to read all their position papers to vote intelligently; the public persona is what will guide the policy. Before the 2000 election, George W Bush said he believed in controlling greenhouse gasses but talk is cheap and his whole campaign was laissez faire capitalist, which dominated post-campaign.

2. Vote for the better candidate.

Don't expect a saint because they rarely appear on the ballot. If you are a ecologically minded, you may be disappointed if the incumbent hasn't made, or the candidate doesn't promise to make, the US more sustainable. But if the opponent denies climate change, scoffs at greenhouse gasses, and doesn't value increased efficiency over “drilling and burning”, then you should vote for your guy despite the disappointment.

Think of a long journey. It is better to head in the correct general direction and fine-tune later that not start at all, or head in the wrong direction.

Woe is US

We really didn't know what “W” stood for early in his reign... “Winner” we hoped (against all evidence). “Wastrel” seemed more probable but was too obscure. “Wrong” fit when he pushed for a war in Iraq based on WMD. Finally, at the end, we knew: “Worst”. Ignoring Richard Clarke's warning about 9/11, ineptly prosecuting two wars, never finding Osama Bin Laden (OBL). A budget surplus turned into a historic deficit. Enron early, Madoff late, a destructive housing bubble supported by a massive derivative market testifying to the lax or absent oversight. Chalk that up to what W didn't learn in Harvard Business School.