What do you all think of the Robin Hood Tax?

[FiveOrangePips]

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trauma I am sorry that you see so little of your DH. That is hard. But at least he will be able to afford to retire, well, tomorrow, if he wants to.

My DH works similar hours, as do many others I know in public sector jobs. We can't afford to buy any house. Let alone buy one outright. I can't see how that is right.

apologies for shite grammar...

PelvicFloorTrauma, I'm sorry too that you see so little of your DH :(. I have no reason to doubt that he does work 'fucking hard' as you say.

However, surely you can see how insulting it is to suggest (and you do suggest this, in your post) that your DH earns the massive bonuses he does just because he works 'fucking hard'?! He earns these bonuses probably because he works in an industry that offers these sorts of bonuses, NOT because of his working hard or not. He could still be working equally hard & earning much less. There are loads & loads of people- surely you know that!- who work equally long hours, often in 2 jobs, and just barely make ends meet.

As for the Robin Hood tax, really I have no idea whether it's a good idea or not (and there's the question of: good idea from whose POV), but surely things are getting to the point, with all these cuts, that there's a lot of anger building up that people in some industries are still receiving massive, massive salaries & bonuses. This anger about the growing gap between rich & poor doesn't have to do with logic (whether the Robin Hood tax is good or bad or whatever), but has to do with a much deeper feeling of unfairness that surely is right. Not sure I have any suggestions/solutions though :(

How much you earn depends on how much work you do and the market value of work you do. For example an accountant may work the same number of hours as a cleaner but the market values the work the accountant does more and so they are paid more than the cleaner.

I don't think the Robin Hood tax is a good idea.

However I do think that the banks should be made to pay back their bail-outs much more quickly than they currently are. That would in turn mean they are less able to pay large bonuses/salaries.

I believe that companies that are doing well financially should be able to reward their employees well with bonuses and high salaries, and should not be penalised financially for doing well. Any necessary wealth redistribution should be done by income tax, not by taxes on specific industries or specific people.

However the banks that were bailed out are NOT doing well financially. They are propped up by massive govt subsidies. I cannot understand why a company in that position is allowed to make large payments to staff.

Huddspur, exactly. Which makes the point that whether you work 'fucking hard' or not is beside the point. It is of course true that some people are highly qualified / specialised in a particular area, so get paid better because of that. However, it's not all cases of highly paid people who are that educated/specialised. And it's equally not the case that every highly qualified / specialised / very educated person gets well paid, far from it.

I find it extremely arrogant & annoying when people who have chosen (and have been able) to enter a field that the market happens to value highly at a given time & so earn shit loads of money, go on to then think that it's because of their specialness / fantastic abilities that they're paid so much.

Is it not good career planning Maria. If I were graduating now then I would not be looking at getting a job in the civil service or any other area of the public sector due to the pressures that they are going to come under to reduce their costs.
Similarly the financial sector is the largest wealth creator in the country and so it is likely to be well paid so it would make a more sensible choice to try and get a job there.

Perhaps it's also good career planning Byrel IF one's priorities are simply what field pays most. But a, not everyone has this priority. B, not everyone is good at the particular skills that these highly-paid careers require. And c, even with the best of planning, these things change regularly so anyone can find themselves with much less money that they assumed they'd be earning.

excellent post minipie.

minipe I think the state run banks pay out bonuses in order to stop the other banks headhunting and stealing their best employees. If we said no bonuses for Northern Rock or HBOS bankers then wouldn't Santander, HSBC etc come after the best bankers these banks have and poach them as they can offer them more money.

However angry we feel about the banking crisis and however satisfying a bit of payback would be, the Robin Hood Tax is a non-starter because nobody can be forced to pay it.

If banks had to physically relocate to avoid it, as someone suggested, there might be some short term gain. But they don't - they can just redirect their transactions.

If we solved that problem, and managed to force them to pay somehow, they could pass on the additional costs in charges to you and me - for we are less mobile than the banks.

Plan B anyone? :)

I am not suggesting that my DH earns what he does simply by working hard. I was trying to make the point that there is a degree of sacrifice, dedication, commitment, drive and ambition there too. There seems to be a sense that people in the City earn vast amount simply by showing up for work. That isn't true. My DH has done his job for many many years, he is very skilled and his empliyer pays him handsomely for that and he pays an enormous amount of tax.

I am hugely aware that people on much lower incomes also work day in day out, eking out their wage, trying to make ends meet.

And Maria - are you suggesting that everyone should earn the same amount? Your chippy little comment about "specialness/ fantastic abilities" hints at wanting to cap/ align earnings. And also what's with the "have been able to" comment too?

Robin Hood tax is silly; it's the equivalent of charging you on the number of items in your trolley rather than the total value of the items. That's why a very small tax has such a big impact. Banks carry out multiple transactions, some with very small margins (i.e. profits) which would each attract the tax. Not all of these transactions are speculative eg you might carry out the multiple transactions to fulfil a client order (from a corporate for example) or because economic data changes, requiring a change of approach etc etc.

Yes byrel that is what they say.

However frankly I believe that they could pay considerably less and the world would not fall apart as they suggest.

Yes, a few "star names" would leave. And profits might therefore reduce a little. However, frankly, a lot of banking work does not require rocket scientists to do it and could be done by people paid less (which would still be a very good wage by the standards of anyone outside banking).

Minipie Surely if the extra profit by having the "star names" exceeds the bonuses that they are paid (which it must do to be commerically viable) then its is worth paying the bonuses.

Yes but I think that profit (or the vast majority of it) could be made for the bank by someone else who would do the job for less. I suppose I don't believe that a "star name" is so much better than other bankers that he can create £millions more for his bank than others would be able to do. A lot of the time it's about being given the best accounts and opportunities.

Totally behind a Robin Hood Tax.

Why should we pay for the screw ups of bankers? They should pay!

Pelvic: 'there is a degree of sacrifice, dedication, commitment, drive and ambition there too', you say. But who said otherwise? Of course there is sacrifice, dedication etc involved. But my point was, very simply, that an equal degree of all these qualities might exist in people who simply work in industries / fields that are paid much less...

As for 'being able to get these jobs', I meant that not everyone has access to these highly paid jobs, a degree of luck / background / education (often related to money, although not always) is involved.

I suppose what I'm saying is, it's important to be aware of the circumstances and luck that have led to one's good fortune, and not just to attribute everything to ability. I say this because I've seen this attitude in people working in the city- not everyone, I stress!! There are lovely people working in the city. It's an attitude which can be boiled down to 'well tough that you don't earn as much, it's because you're a loser / don't work hard enough'. That's what I object to.

"Totally behind a Robin Hood Tax.

Why should we pay for the screw ups of bankers? They should pay!"

We should pay for their screwups because the vast majority of us benefited hugely from their success in recent years.

The Bankers are paying.

Have any of the Robin Hood tax advocates read the thread on Mervyn Kings Speech?

The banking system nearly brought the global economy to collapse, and all these guys can come up with is way to cream off profits from the existing system.

We in the UK are already too reliant on banking industry taxes to fund our public sector (hence New Labour's lax attitude).

If it succeeds - The Robin Hood Tax only makes us more reliant.

We need to make the banking system safer and widen our tax base. This does neither and tbh is a distraction.

How would such a small tax "destroy" London?

Maria - my husband is totally self-made. He had a good education due to bursaries and scholarships but by no means was he born with a silver spoon in his mouth.

And as for luck, he set up his own business in 2001 and it went bust within 18 months. He picked himself up, joined a bank and that went bust in 2008. So as for the earlier comment by another poster about him retiring soon, I don't think so.

I think the reason I atrribute his success to his ability is because he couldn't do the job he does without a quite specific skill set/ personality.

Minipie - have you ever met a rainmaker? Your wonderfully assured and deeply vague comment about it being all down to getting the good accounts makes me think not!

The tax would reduce competitiveness as it would make the costs of banking in London more than the costs of banking in Frankfurt or another financial centre.

Pelvic, I'm sure your DH is a nice man, self made etc: all that you say being as it is, that doesn't dispute the fact that lots of professions require a 'quite specific skill set / personality' (with personal characteristics as positive as the ones you describe in your DH) and yet don't pay nearly as much. Don't you see how this may seem unfair to lots of people? I don't have a problem with higher earnings, but I do have a problem with HUGELY higher earnings, and with MASSIVE bonuses, when so many people are losing their jobs etc. Not sure I have the answer to all this, and not saying any individual person has the capability to do anything to change it, but just expressing my gut feeling that there's something deeply wrong with some people earning sky high & others barely getting by.

But maybe, as smallwhitecat helpfully (!) suggested, I'm not 'getting it' and am 'stupid'. What a nice way to justify the fact that one is getting huge huge bonuses so many cuts are being made. By believing it's 'for the good of society' and by thinking others are 'stupid' for not understanding why these amounts are justified.

It's amazing how people can justify completely unjust things- like deeply cutting all sorts of benefits- and at the same time not understanding that there's a reverse side to the same coin.

This Tax doesn't seem doable though, in practice. Wouldn't the Robin Hood Tax only be possible if all countries agreed to do it together? Which doesn't seem likely, realistically.